An acute case of recovery: can Comet see through Windows?

This Kat is often in a love-hate relationship with the Microsoft Windows operating system on her computer. Therefore she was interested to read yesterday that the software giant had commenced proceedings in the High Court for England and Wales against retailer Comet for allegedly making and selling unauthorised Windows recovery CDs.

As readers will know, these recovery CDs are used for fresh re-installations of the Windows operating system. Normally, the Windows operating system is pre-installed on new computers. However, in recent times, computer manufacturers have tended to stop including the recovery CDs with their computers, instead installing the software on to special hard drive partitions and placing the onus on the purchaser to make their own recovery CDs. Microsoft alleges that Comet made more than 94,000 Windows Vista and Windows XP recovery CDs in a factory in Hampshire, selling them to customers for £14.99 each from its 284 stores across the UK between March 2008 and 2009 (reportedly making in excess of £1.4m in sales).

In a statement, David Finn, associate general counsel, Worldwide Anti-Piracy and Anti-Counterfeiting at Microsoft yesterday said:

'As detailed in the complaint filed today, Comet produced and sold thousands of counterfeit Windows CDs to unsuspecting customers in the United Kingdom ... Comet’s actions were unfair to customers. We expect better from retailers of Microsoft products — and our customers deserve better, too.'

In response, Comet issued a press release stating that:

'Comet has sought and received legal advice from leading counsel to support its view that the production of recovery discs did not infringe Microsoft’s intellectual property.

Comet firmly believes that it acted in the very best interests of its customers. It believes its customers had been adversely affected by the decision to stop supplying recovery discs with each new Microsoft Operating System based computer.

Accordingly Comet is satisfied that it has a good defence to the claim and will defend its position vigorously.'

Comet's actions may have been in the best interests of its customers, but were they legal?  The IPKat suspects that Comet may struggle to defend its actions under section 50A of the Copyright Designs and Patents Act 1988. Under section 50A(1), it is not an infringement of copyright for a 'lawful user' of a copy of a computer program to make any back-up copy of it, which is necessary for it to have for the purpose of its lawful use. 'Lawful user' in section 50A(2) is defined as a person who has the right to use the program. Comet seems to be trying to respond to commercial need by making back up discs on behalf of its customers.

The IPKat is not as yet aware of the full facts of the case. However, it seems to him that if such discs were made in advance and not in response to a specific request from a customer, Comet may have difficulties in establishing that it made the discs as a result of a request from a 'lawful user'. Further, even if Comet could succeed on this point, the alleged charge of £14.99 per recovery CD seems disproportionate to the cost incurred by Comet in actually making it.

Merpel: Linux, anyone?

Recovery position here