U.S. Navy Facing $600 Million Lawsuit For Software Piracy

Image courtesy of United States Navy

Let’s be honest here: we probably mostly have a mental picture of the kind of entity that gets accused of software piracy, and that picture is probably someone in their late teens or early twenties. What it doesn’t look like in probably anyone’s head is “like a division of the U.S. military.” And yet that’s exactly who — or what — is being sued for copyright infringement on a massive scale.

As TorrentFreak first spotted, a German company has filed a lawsuit against the Navy — yes, the entire U.S Navy — for allegedly installing their software on over a half million computers without paying for it.

The company, Bitmanagement, makes a 3D virtual reality program called BS Contact Geo. According to the complaint (PDF), Bitmanagement and the Navy agreed to a trial license of the software in 2011 and 2012. That agreement let the Navy use the program on 38 computers on a trial basis — to see if they liked it, to see if it was useful, to see if it could be integrated with other Naval systems, and so on.

Bitmanagement says in their complaint that “in order to facilitate such testing and integration of the software … in preparation for the large-scale licensing desired by the Navy, it was necessary for Bitmanagement to remove the control mechanism that tracked and limited the use of the software.”

Imagine any 30-day trial you’ve downloaded (or shareware game, if you’re old enough to remember those). Now imagine that the company that made it took off any limitations on features and made the “you are using a trial version” pop-up go away. That’s the small-scale version of what Bitmanagement says happened here, and that’s what allowed it to balloon.

The complaint says that while the negotiations for a large-scale — like, Navy-wide — license agreement for the software were still going on, the Navy just… kept installing it. Copy-paste on to hundreds of thousands of computers. And, Bitmanagement says, the Navy never paid for that either.

That infringement is worth $600 million, says Bitmanagement, calculating out the regular cost of $1067 per license times the 558,466 computers the company says the Navy installed their program on.

Interestingly, TorrentFreak notes, this isn’t the first time that the U.S. military has been sued for software piracy. In 2013, the federal government agreed to a $50 million settlement over unlicensed software the Army had been using to manage troop and supply movements.


Want more consumer news? Visit our parent organization, Consumer Reports, for the latest on scams, recalls, and other consumer issues.