SoCal Man Headed To Federal Prison for 'Restore Discs'

A man from Southern California is now on his way to federal prison after infringing on proprietary products made by Microsoft Corporation, the Los Angeles Times reports.

Eric Lundgren, a 33-year-old Chatsworth resident and owner of IT Asset Partners, received his 15-month sentence in April. The sentence comes nearly six years after an investigation was opened by federal authorities. Lundgren was accused of creating compact discs that were duplicates of proprietary Microsoft products. A Microsoft representative would later tell The Verge that Lundgren counterfeited their Windows software.

The court agreed, saying the "restore discs" infringed on Microsoft Corp. property, even though Lundgren argued he gained no monetary compensation for the discs. Lundgren noted that the restoration software in question is available for consumers to download for free on Microsoft's website.

In addition to the 15-month prison sentence, Lundgren was also charged a $50,000 fine.
Lundgren and his IT Asset Partners business were known as innovators in the electronic waste -- known commonly as e-waste -- industry.

IT Asset Partners, which Lundgren started after returning to the United States from a stint in China, is a major player in the e-waste marketplace. Companies like IT Asset Partners are able to use discarded electronic parts from cellphones, laptops, tablets and other electronic devices to restore or sometimes create new devices. This, in turn, ensures that electronics do not end up in landfills, which can have harmful effects on the environment.

IT Asset Partner's website touts that they can turn nearly all elements of an electronic item, including most "parts, components and commodities," into "value extraction." The company counts a number of large-named brands -- Motorola, IBM and Sprint among them -- as their clients.

The federal investigation into Lundgren began in 2012. U.S. Customs officers seized a shipment of discs sent by Lundgren to an associate in Florida. Both Lundgren and his associate were later charged with copyright violations and trafficking counterfeit goods. The associate reached a plea deal with the court, resulting in a six month home arrest sentence.

In all, 28,000 restore discs were seized. The federal court found that Lundgren's actions had cost Microsoft $700,000 in potential sales, at a rate of $25 per disc. The LA Times reports that prosecutors expected Lundgren to self-surrender and begin his 15-month sentence as soon as he makes financial plans for himself and his 100 employees, though Lundgren told the paper that prosecutors said if he "got loud in the media," they would "come pick me up."


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