Software pirate receives 5.5-year sentence

Apparently Ralph Blasek didn't do a good job at plotting his next few moves. The professional chess player, and presumed leader of Europe's largest known software counterfeiting network, was sentenced Thursday by a German judge with five and half years in prison without probation.

"This is checkmate to you Blasek. The court wants to see your king fall," the judge said, according to sources close to the case who were in the courtroom during sentencing.

The defendant was convicted of fraud for selling illegal software to customers but the case centered on the tampering of Microsoft Corp.'s education software. According to Microsoft, Blasek obtained legitimate Microsoft software sold to schools and educational facilities at a discounted rate and then resold it as full versions to non-educational customers for well over the discounted price.

He manipulated the software and its packaging to create counterfeit versions and sell the licenses, a Microsoft representative said.

Microsoft suffered €4.5 million ($5.5 million) in damages due to Blasek's activities, the court spokesman said.

Blasek is also believed to run a sophisticated international software counterfeiting ring involving hundreds of front companies with bank accounts established around the world. The organization was supposedly set up in the early 1990s, and generated over $100 million worth of counterfeit software in just the last few years of operation, according to sources close to the case. The organization is even thought to have manufactured counterfeit software using a German-based CD manufacturing plant that normally produces music CDs for independent artists.

His sentencing Thursday followed an investigation by Germany's Bundeskriminalamt, the equivalent of the U.S.' Central Intelligence Agency, and local police and a 10-week trial in the criminal court of the city of Bochum in Northrhine-Westfalia.

Blasek's five-and-a-half-year sentence comes without probation or the possibility of appeal, and is on top of the eight months he has already spent in jail since his arrest last November, courtroom sources said. The court spokesman confirmed the five-and-a-half year sentence but did not confirm whether Blasek was being denied an appeal or whether he was unable to subtract the eight months he has already served.

According to sources, Blasek was a smooth operator -- he kept very little software on-site and moved the discs very quickly.

Sources in the courtroom said the judge issued the tough sentence in part because the defendant was undercutting legitimate Microsoft channel resellers. The judge billed him as a "real criminal personality and not an entrepreneur gone off the tracks," the sources said.

Microsoft applauded the sentencing Thursday in a statement from Laurent Delaporte, its vice president of small and medium business and partner group for Europe, the Middle East and Africa.

"Today's sentence sends an important message to many resellers, distributors and system builders who are threatened every day by illegal software sales and criminal counterfeiting. This is a positive step forward to protect their business," Delaporte said.

(John Blau in Düsseldorf contributed to this report.)