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Microsoft Corporation today announced a multi-million dollar settlement with The MPO Group, a Microsoft® authorised disk replicator, following a several-year investigation into the production and distribution of counterfeit Microsoft server software. As part of the settlement, MPO has acknowledged that it breached the disk replication agreements it had in place with Microsoft after unlawfully replicating thousands of Microsoft server software disks in reliance on a fake Microsoft licensing agreement.

Headquartered in Averton, France, with operations in Ireland and Thailand, MPO Group's Thai subsidiary manufactured 20,000 counterfeit copies of Microsoft Exchange and SQL Server™ products in July 2003. In the ensuing year, investigators and attorneys in Microsoft’s Worldwide Anti-Piracy team, often working in collaboration with law enforcement officials, recovered some of the counterfeits in court-authorised searches and test purchases and traced them back to the MPO Group’s Thailand manufacturing facility at MPO Asia.

According to MPO, their local Thai office had manufactured the disks after relying on what turned out to be forged documentation from a third party that purported to have a license from Microsoft to distribute Microsoft software. In fact, no such license existed, and Microsoft does not license its software to be reproduced and distributed in this way.

MPO Thailand’s production of the counterfeit disks resulted in copyright and trademark infringement and a breach of the Disk Replication Agreements between Microsoft and MPO. Once MPO realised what it had done, MPO cooperated with Microsoft in a joint and comprehensive worldwide investigation that continues to find counterfeit Microsoft software in the international distribution channel.

“We are pleased to have settled this case with the MPO Group so quickly and look forward to an ongoing relationship with them,” said David Finn, Associate General Counsel, Worldwide Anti-Piracy and Anti-Counterfeiting. “We appreciate the steps MPO has taken to tighten their security procedures to prevent a recurrence of this type of wholesale counterfeiting of Microsoft software, and to help track down all those responsible for distributing the counterfeits.” Frank Holland, Microsoft vice president of operations, said, "Security, controls and compliance are absolutely vital in the supply chain of a company like Microsoft, where intellectual property is at the heart of our business."