Piracy in supply chain can block sale of goods in US

Microsoft seeks ‘own personal unfair competition laws’

Microsoft is reportedly seeking to have legislation introduced in the United States that will pave the way to sue companies that source materials from suppliers that use pirated Microsoft software.

"Microsoft seems to be trying to get its own personal unfair competition laws passed state by state, so it can sue US companies who get parts from overseas companies who used pirated Microsoft software anywhere in their business," said open source legal news website Groklaw.

The law reportedly means that US companies are liable for pirated software used by their suppliers, even if the software was "not in any step of the manufacturing process alone but anywhere in that business," said Groklaw.

The legislation even paves the way for blocking the sale of products in Microsoft’s home state of Washington. Groklaw speculated that the real target of the move is to go after competition such as the Android smartphone operating system.

By encumbering competing products with legal liability, Microsoft’s own commercial offering, such as Windows Phone 7, will become better able to compete, Groklaw suggested.

"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," said Groklaw.

"And you don’t have to even prove infringement in China, just allege it to initiate proceedings."

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