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Indiana Man Nabbed for Selling Counterfeit Software on eBay

An Indiana man will spend 27 months in prison for selling more than $700,000 worth of counterfeit software on eBay, the Milwaukee FBI announced on Wednesday.

Courtney Smith, 36, of Anderson, Ind., was sentenced by U.S. District Judge Sarah Barker of the Southern District of Indiana for selling the software over the Internet, in violation of criminal copyright infringement laws.

The FBI said that Smith pled guilty. At his sentencing, Smith confessed that he purchased counterfeit Rockwell Automation software through eBay. He then duplicated the software and resold it, again through eBay. Between March 6 and May 26, 2004, Smith sold the counterfeit copies in 32 or more auctions, for a total of $4,149.97. The actual retail value of the software would have been over $700,000.

"Mr. Smith exploited eBay to sell hundreds of thousands of dollars worth of counterfeit software at drastically reduced prices, thereby illegally profiting on the back of the copyright holder," said Assistant Attorney General Fisher, in the FBI's statement. "The Department of Justice is committed to prosecuting individuals who exploit legitimate online auction sites to sell pirated software and commit other acts of fraud."

The arrest was one associated with a Department of Justice initiative to combat online auction fraud. FBI agents executed a search warrant in December 2004 and seized computers, CDs and other devices used to manufacture the counterfeit copies. According to the FBI, Smith admitted that he knew it was illegal to sell copyrighted software. He also told the FBI that he made his own Rockwell Automation Software labels to affix to the counterfeit software.

Rockwell Automation is a global provider of automation, power, control and information products that produces specialized factory management software. The factory software controls and visualizes factory production lines and machinery. The counterfeit Rockwell software sold on eBay had retail prices ranging from about $900 to $11,325.

In addition to the prison sentence, Smith forfeited his computers and other equipment. He will make a payment of $5,200.45 in restitution to Rockwell. He will also be fined $2,000 and will serve two years of supervised release after he completes his sentence.