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Payless, Burlington Settle Software Piracy Claims

Burlington Coat Factory and Payless ShoeSource agreed Tuesday to pay more than $400,000 to settle claims of unlicensed software use.

According to the Business Software Alliance (BSA), Burlington Coat Factory will pay the BSA $300,000 for using unlicensed copies of Microsoft and McAfee. Payless agreed to a $124,057 settlement for use of unlicensed copies of Adobe, Autodesk, Borland, Internet Security Systems, McAfee and Symantec software.

In addition to the payments, both companies agreed to delete any unlicensed copies, purchase replacement software and strengthen its software management practices.

Jenny Blank, director of enforcement at the BSA, said in a statement the settlements illustrate "that it is more expensive to copy software than it is to acquire a sufficient number of licenses in the first place."

The piracy investigation of both firms began with a tip to the BSA's online reporting form. The BSA offers rewards of up to $200,000 for qualifying reports received via its hotline or online reporting form.

Both companies cooperated with the investigations and conducted software audits.

"We have created a new software management policy and continue to refine its implementation to emphasize the importance of understanding each software company's licensing requirements and using only fully licensed software," said Burlington CIO Brad H. Friedman, in a statement.

A study conducted by IDC for the BSA earlier this year claimed that 21 percent of software in the United States is unlicensed.

According to the BSA, the U.S. lost $6.9 billion as a result of software piracy in 2005. Software piracy can result in fines of up to $150,000 for each software title copied.

"BSA recommends that all companies and organizations have strong software management policies in place -- including periodic internal audits, guidelines for supervisors and clear procedures for employees," Blank said.

Businesses trying to determine whether their organization is using unlicensed software can download the free software audit tools at the BSA site.

Targeting software pirates is a hot button issue in the industry these days; just last month, the Software & Information Industry Association (SIIA) settled with two defendants who were illegally selling Symantec software through eBay.

Kevin Liu and G.T. Tian paid $100,000 in damages and vowed to stop selling illegal software.