Secondary liability, approaching the limit

The Seattle Times reported a few weeks ago that Microsoft “is pushing Washington legislators to pass a law making it illegal for manufacturers that use pirated software to sell goods in the state”:

The proposed legislation would create a legal cause of action by making manufacturing companies liable for damages, and it would give the state attorney general and companies the right to pursue injunctions in civil court to stop the manufacturers’ goods from being sold.

For example, if a large Washington store sold T-shirts made from a company in China and the Chinese company uses pirated copies of Excel at an office in Shenzhen, Microsoft could seek an injunction to prevent the manufacturer from supplying T-shirts to be sold in Washington state.

This represents a sweeping change to current intellectual property law. It is one thing to grant monopolies via copyright for “limited Times” in order “To promote the Progress of Science and useful Arts”. It is another thing entirely to extend copyright’s monopoly over physical objects alleged to have been manufactured in another country with the help of pirated software and thus to hold the buyers of those physical objects legally responsible.

To put it concretely:  this isn’t holding the buyers of obviously stolen TV’s out of the back of a pickup truck legally responsible for their purchases.  This is holding GM, maker of that pickup truck, legally responsible because the Chinese manufacturer of one of the parts in the truck’s engine used a pirated copy of Microsoft Outlook to receive emailed purchase orders from GM.

Now that’s secondary liability.

Hat tip to Groklaw, where I ran across this story earlier today.  If you’d like to read more about this, Pamela Jones has written rather extensive commentary, including a hypothesis Microsoft is pushing for this and similar laws in other U.S. states in order to unleash a “litigation storm against Linux” — including derivatives like Android:

The law would make it possible for Microsoft to block Android sales in whatever state passed such laws if it could find some tie between the Android product and some manufacturer of a contracted part in China or wherever who happened to use a pirated version of Microsoft Word — not to make the part but to write up an ad for it. Ephemeral, much? But can you imagine how much litigation could spring from a law like this? How little it would take to keep litigation in the air forevermore? And you don’t have to even prove infringement in China, just allege it to initiate proceedings.

Of course, Jones is quick to note that the state of Washington’s “protections” do not extend to companies like Red Hat that profit from selling open source support and services.  Under the law, software companies with proprietary licenses like Microsoft

can sue in civil court and the Attorney General can go after the “wrongdoer” US company, if a notice is sent and no amelioration occurs. But if the violation is of an *open source license*, the victim can’t sue anyone under the bill, and the Attorney General does nothing for you. It’s an exception to the law.

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