What is the Purpose of the BSA, The Business Software Alliance?
BSA | The Software Alliance is a private trade organization with absolutely no independent law enforcement authority. BSA’s members include the largest software publishing companies in the world and most notably, Microsoft, Adobe, Symantec, Intuit, Autodesk and McAfee. These companies provide BSA | The Software Alliance a power of attorney to act on their behalf to accuse businesses of software piracy. Accordingly, BSA can enforce only those rights that its member software publishers have. Legally, software companies usually have a contractual relationship with a customer based upon a software license and also have the rights provided under copyright laws that protect the holder of copyright against infringement. These are the rights that BSA | The Software Alliance’s enforcement department is attempting to protect.
BSA: How It Works
BSA | The Software Alliance maintains telephone hotlines and a web site to encourage disgruntled employees and vendors to make anonymous reports against companies of all sizes. BSA dedicates a substantial portion of its revenue marketing to these "rats," promising them confidentiality and the ability to make an anonymous complaint. BSA | The Software Alliance investigates all reports of software piracy without independently confirming the veracity of the information provided or the motive of the person making the complaint.
Once a report is received, BSA | The Software Alliance makes a decision about whether to request a self-audit or to immediately file suit. In the overwhelming majority of cases, BSA pursues the self-audit approach. Acting either through an internal enforcement attorney or an outside law firm, BSA will send a letter to the target company requesting a self-audit. The request for an audit is a critical stage in the process, and the time when an experienced attorney can help your business the most. If your company has received an audit letter from BSA | The Software Alliance, you should contact a BSA Defense attorney now.
Why You're a Target
Regardless of whether you are running unlicensed software on your computer networks, it is likely just a matter of time before your business receives a letter from BSA | The Software Alliance. Having represented many companies in BSA audits, Scott & Scott’s lawyers believe that there are only two types of companies: those that have been audited by BSA and those that will be audited by BSA. BSA | The Software Alliance spends substantial resources marketing to disgruntled employees and vendors to encourage them to “rat” on your business. Under the promise of confidentiality and without any accountability for false reporting, these vindictive complaints may cause injury to you, your business, and your business’ reputation.
Your business, regardless of its size, is a target because no matter what, someone is going to think you treated them unfairly and will make a report to “get even.” The vast majority of BSA audits are the result of tips made by disgruntled ex-employees. In addition, BSA’s members are increasingly deploying anti-piracy technologies including product tracking and phone-home technologies.
BSA | The Software Alliance’s primary enforcement tool is to send a threatening letter indicating that an investigation has commenced and offering to forego litigation if the target company provides a self-audit. A self-audit consists of a listing of all BSA member software running on a company’s computer networks, appropriate indicia of ownership for the software (including copies of media and manuals) and dated proofs of purchase for each title. It is important to note that companies are usually under no legal obligation to cooperate with BSA | The Software Alliance. In most instances, however, cooperation will yield the most cost effective resolution. But, that is not necessarily always the case.
It is very important to engage an attorney experienced in fighting BSA before any documents are produced. Once produced, the documents can and will be used by BSA to leverage its legal position when negotiating fines or pursuing litigation.
Scott & Scott, LLP has represented more than 250 companies accused of software piracy by BSA | The Software Alliance. Our highly focused team of attorneys and technology consultants can guide your business through every step of the BSA Audit process. Whether your company is already under investigation or just concerned about exposure, our lawyers have the technical and legal experience necessary to protect your business against BSA | The Software Alliance.
BSA is funded by large software companies including Adobe, Autodesk, McAfee, Symantec, and Microsoft to name just a few. They have deep pockets to hire law firms with many resources. It is not advisable to be in a David vs. Goliath situation without experienced counsel on your side to protect your rights.
Many companies targeted by BSA | The Software Alliance are paying substantial fines and suffering negative publicity because they did not have experienced counsel. Properly preparing for and responding to software audits can reduce the financial and organizational impact on your business.
We have saved our clients thousands in potential penalties and have represented companies across the U.S. and Canada against allegations of software piracy by BSA. Our clients have ranged from a one-person lumber shop with a couple of computers to major corporations with more than 25,000 computers.
Our attorneys have the legal and technical experience necessary to protect your business against BSA. You can leverage the knowledge we’ve gained successfully defending companies like yours.
After reviewing the results of a self-audit, BSA | The Software Alliance will send a letter either concluding the investigation or making a demand for payment of a fine and requesting other onerous conditions for settlement. To use our BSA Fine Calculator to estimate your exposure click here. If you have received a BSA | The Software Alliance settlement demand letter, it is not too late to obtain the assistance of an experienced BSA Defense attorney. Our lawyers can help you negotiate a reduction in the proposed fine and guide you through the non-monetary portions of a potential settlement with BSA | The Software Alliance. If you have received a settlement demand letter, you now realize that this is a serious legal matter that requires experienced counsel to protect your company’s interests.
BSA | The Software Alliance has developed a standard formula for assessing fines as part of its settlement process. It is important to note that BSA is not a governmental entity and has no independent authority to levy an enforceable fine. BSA | The Software Alliance fines are therefore merely offered in settlement to avoid litigation and, like all pre-litigation settlement offers, are negotiable with the help of experienced counsel.
Dated Proof of Purchase Required
BSA's methodology for calculating fines starts by treating as unlicensed all software products for which there is a lack of adequate documentation, including dated proofs of purchase. All proofs of purchase must be dated prior to BSA | The Software Alliance's initial letter to be considered valid evidence. Because companies may not always have access to the requisite dated proofs of purchase, BSA's proposed fines are often based, in part, on software titles that companies legally own and properly acquired.
Unbundling Software Suites
BSA | The Software Alliance also unbundles the products in software suites such as Microsoft Office. So instead of proposing a fine based upon one copy of Microsoft Office, BSA proposes a fine for Microsoft Outlook, Microsoft Word, Microsoft Excel, and Microsoft PowerPoint. The result is a proposed fine of $1,096 for a product that retails for $339.
The Arbitrary 3x Multiplier
After disallowing credit for valid software without dated proofs of purchase and unbundling all software suites, BSA | The Software Alliance then applies an arbitrary multiple of three times the full retail price for each software title. Accordingly, one allegedly unlicensed copy of Microsoft Office will carry a proposed fine of $ 3,288.
The Attorney's Fees
To add insult to injury, BSA | The Software Alliance’s proposed fine will include a line item for $5,000 to $7,500 to pay BSA’s attorney’s fees. While this is not usually a large number as a percentage, it should be taken into account when considering potential exposure. To calculate your potential exposure, use our BSA Fine Calculator.