senate Bill S856

Relates to the illegal use of stolen or misappropriated computer software

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Bill Status


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor
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actions

  • 09 / Jan / 2013
    • REFERRED TO CONSUMER PROTECTION
  • 08 / Jan / 2014
    • REFERRED TO CONSUMER PROTECTION

Summary

Relates to the illegal use of stolen or misappropriated computer software; includes definitions and penalties.

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Bill Details

Versions:
S856
Legislative Cycle:
2013-2014
Current Committee:
Senate Consumer Protection
Law Section:
General Business Law
Laws Affected:
Add §390-d, Gen Bus L
Versions Introduced in 2011-2012 Legislative Cycle:
S5089

Sponsor Memo

BILL NUMBER:S856

TITLE OF BILL:
An act
to amend the general business law, in relation to stolen or
misappropriated computer software

PURPOSE OF THE BILL:
To make it unlawful for a person to develop or
manufacture a product or supply services using stolen or
misappropriated software.

SUMMARY OF SPECIFIC PROVISIONS:
This bill adds a new §390-d to the
General Business Law to make it unlawful for a person to develop or
manufacture a product or supply services using stolen or
misappropriated software, including software that does not have the
necessary license agreements.

The Attorney General and third parties adversely affected by reason of
a violation of this section, are empowered to enjoin further
violation and to recover actual damages, including treble damages
upon a showing of a Pattern or practice of violating the provisions
of this law.

JUSTIFICATION:
When businesses, including businesses
in foreign
countries, use stolen software to make products or supply services
that are offered to New York consumers, they gain an unfair
competitive advantage over businesses that use legal, properly
licensed software. This radically tilts the competitive playing field
by rewarding businesses that break the law costing New York
businesses billions of dollars and costing New York State and local
governments hundreds of millions of dollars in direct revenue.

Although federal copyright law allows software companies to combat the
act of software theft, there are currently few avenues to address the
harms to competition that flow from the use of stolen software.

This measure provides a crucial new tool to go after those who use
stolen or pirated software to hurt competitors, not just software
pirates. It does so by making the use of stolen/pirated software to
create and sell products unlawful, giving the Attorney General and
adversely-affected parties the enforcement tools to stop and punish
those who use stolen goods to harm New York businesses. Moreover, it
makes law-breakers liable not only for the first item sold, but also
for the full extent of the product or services made and sold based on
the stolen software.

The need for additional tools to combat the economic damage caused by
the illegal use of stolen software is obvious. In 2008, worldwide
software piracy was pegged at 41 percent representing losses of over
$50 billion. Yet, the real economic damage reaches well beyond the
piracy itself; it extends to the very fabric of the use of
intellectual property


in the development of the innovative products and services. It
means fewer jobs in New York, less innovation, hundreds of millions
of dollars in lost tax revenue and reduced economic growth overall.

This measure will provide the State, through the Attorney General,
and the companies that are adversely affected, the legal construct to
fight back against this pernicious use of stolen computer software
and the intellectual property behind it.

PRIOR LEGISLATIVE HISTORY:
2011-12: S.5089 - Died in Consumer Protection
2009-10: (A.11395-A) Amended and recommitted to Economic
Development

FISCAL IMPLICATIONS:
According to a 2007 study, software piracy alone
costs New York taxing jurisdictions more than $344M in lost tax
revenue alone. This bill is a saves revenue

EFFECTIVE DATE:
This act shall take effect 90 days after it becomes law.

view bill text
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                   856

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                               (PREFILED)

                             January 9, 2013
                               ___________

Introduced  by  Sen.  PARKER -- read twice and ordered printed, and when
  printed to be committed to the Committee on Consumer Protection

AN ACT to amend the general business  law,  in  relation  to  stolen  or
  misappropriated computer software

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. The general business law is amended by adding a new section
390-d to read as follows:
  S 390-D. ILLEGAL USE OF STOLEN OR MISAPPROPRIATED  COMPUTER  SOFTWARE;
PENALTIES.    1.  FOR  THE  PURPOSES OF THIS SECTION, THE TERM "COMPUTER
SOFTWARE"  SHALL  MEAN  AN  ORDERED  SET  OF  DATA  REPRESENTING   CODED
INSTRUCTIONS  OR  STATEMENTS  THAT, WHEN EXECUTED BY COMPUTER, CAUSE THE
COMPUTER TO PROCESS DATA OR DIRECT THE COMPUTER TO PERFORM ONE  OR  MORE
COMPUTER OPERATIONS, OR BOTH.
  2.  IT IS UNLAWFUL FOR A PERSON TO DEVELOP OR MANUFACTURE A PRODUCT OR
PRODUCTS, OR TO PROVIDE A SERVICE, WHILE USING  COMPUTER  SOFTWARE  THAT
SUCH  PERSON  KNEW, OR SHOULD HAVE KNOWN, WAS STOLEN OR MISAPPROPRIATED,
INCLUDING, BUT NOT LIMITED TO COMPUTER SOFTWARE FOR WHICH LEGALLY  VALID
LICENSE AGREEMENTS DO NOT EXIST, WHERE ANY SUCH PRODUCTS OR SERVICES ARE
SOLD OR OFFERED FOR SALE IN THIS STATE.
  3.  (A) THE ATTORNEY GENERAL, OR ANY PERSON WHO HAS SUFFERED DAMAGE BY
REASON OF ANY VIOLATION OF SUBDIVISION TWO OF THIS SECTION, MAY BRING AN
ACTION AGAINST A PERSON WHO VIOLATES THE PROVISIONS OF SUCH SUBDIVISION:
  (1) TO ENJOIN FURTHER VIOLATION OF THE PROVISIONS OF  SUBDIVISION  TWO
OF THIS SECTION; AND
  (2) TO RECOVER THE GREATER OF:
  (A) ACTUAL DAMAGES; OR
  (B) ONE THOUSAND DOLLARS FOR EACH VIOLATION OF SUBDIVISION TWO OF THIS
SECTION.
  (B) IN AN ACTION UNDER PARAGRAPH (A) OF THIS SUBDIVISION, A COURT MAY:

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD02889-01-3

S. 856                              2

  (1)  INCREASE  THE  DAMAGES  UP  TO THREE TIMES THE DAMAGES ALLOWED BY
PARAGRAPH (A) OF THIS SUBDIVISION WHERE THE DEFENDANT HAS BEEN FOUND  TO
HAVE  ENGAGED  IN  A PATTERN AND PRACTICE OF VIOLATING THE PROVISIONS OF
SUBDIVISION TWO OF THIS SECTION; AND
  (2) AWARD COSTS AND REASONABLE ATTORNEY'S FEES TO A PREVAILING PARTY.
  (C)  FOR  THE PURPOSES OF THIS SECTION, A VIOLATION SHALL BE DEEMED TO
HAVE OCCURRED EACH TIME A PRODUCT OR SERVICE IS SOLD OR OFFERED FOR SALE
IN THIS STATE.
  4. NOTHING CONTAINED IN THIS SECTION SHALL IN ANY WAY LIMIT THE RIGHTS
OR REMEDIES WHICH ARE OTHERWISE AVAILABLE  UNDER  LAW  TO  THE  ATTORNEY
GENERAL OR ANY OTHER PERSON AUTHORIZED TO BRING AN ACTION UNDER SUBDIVI-
SION  THREE  OF  THIS SECTION, NOR SHALL IT LIMIT THE ENFORCEMENT OF ANY
APPLICABLE PROVISION OF THE PENAL LAW.
  S 2. Severability. If any clause, sentence, paragraph, section or part
of this act shall be adjudged by any court of competent jurisdiction  to
be  invalid,  the  judgment  shall not affect, impair, or invalidate the
remainder thereof, but shall be confined in its operation to the clause,
sentence, paragraph, section or part thereof directly  involved  in  the
controversy in which the judgment shall have been rendered.
  S  3.  This  act shall take effect on the ninetieth day after it shall
have become a law.

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