Today, my company received yet another legal letter from a reputable design software company, lets call it company A. The legal letter seems to hint that we are using pirated copies of their software. We received a legal letter from this company back in FY2005 as well. My company is an internally recognized world leader in our field. Back in FY2005, our top management from China site were pretty upset over this incident. The IT department did a complete physical check on every computer (about 200pcs) at our company. Finally we found that one employee downloaded a copy of the software via the internet onto his PC. We settled the issue by paying a huge sum of money to them. To prevent this issue from happening again, our IT department bought a sophisticated software to monitor if there are any additional of illegal softwares. In additional, our IT department will conduct quaterly checks. This time, we are very sure that we are not using any pirated copies of their software.

After some market survey, we actually discovered that this is an industry norm in China!! Some software companies hope to generate commissions by sending out legal letters to potential customers. They would accuse them of illegally using their copyright software without paying. It is surprising to note that in some companies, their sales team is much smaller than their legal team. This strategy would probably work for small customers. However, for multinational companies, it is absurd to send such letters. Multinational companies like ours, may actually spend a lot of effort and resource to clarify this issue. At the end of the day, the whole matter would most probably leave a very bad impression on the customers. The worst case scenario is that the customer might counter-sue the software company.

To make matters worse, we discovered that some software companies like company A based their suspicion on very vague data. Distributors of their software would make cold calls to potential customers on the pretext of conducting market survey. In the survey process, they would like to pry data and make their own conclusions. Based on these conclusions, they would submit their case to the software company to issue the legal letters. Small design company who uses pirated design software need to take note on this. If you are so unlucky to receive these legal letters, they will force you to pay a huge sum of money. And surprisingly, this money are their commissions by sending out legal letters to companies who they think might be using their software.

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