Thousands of criminal cases opened in Germany for buying Windows licenses over 3rd party reseller.

[Venson]

 

Summary

 After the German license reseller "Lizengo" was busted for selling illegibly obtained keys (Source German), the German department of justice targets now buyer of those keys. They obtained buyers information's and opened criminal cases in "a low five digit's range" according to golem.de. This seems to target mainly buyer who brought keys for unreasonably low prices. 

 

In a small number of cases, the German department of justice also seem to be conducting house searches when initial investigations were not promising enough.

 

Under German law, obtaining a software key and not holding a License for it, is punishable for a private person with no intend to reselling up to 3 years in Prison.  

 

Quotes

 

Quote

Original:
Von ähnlichen Fällen berichtet auch der Koblenzer IT-Anwalt Tobias Kläner. "Verschiedene Staatsanwaltschaften in ganz Deutschland ermitteln momentan wegen des Kaufs eines Microsoft Windows 10 Aktivierungskeys auf Ebay im Jahr 2020 zum Preis von 2,50 Euro", schreibt er auf seiner Webseite. 

Translation:

Similar cases were already known to the IT Lawyer Tobias Kläner. "Multiple government agencies are investigating buyer of Microsoft Windows 10 keys sold over Ebay in 2020 for 2,50€" as stated on his website.

Quote

Original:

"Ein funktionierender Product-Key ist nicht gleichbedeutend mit einer gültigen Lizenz. Product-Keys sind keine Lizenzen, sie dienen lediglich dazu, dass derjenige Kunde, der bereits ein Nutzungsrecht ('Lizenz') für ein Computerprogramm erhalten hat, dieses installieren und aktivieren kann."

Translation:

"A Product key that is able to unlock a software is not a license that authorizes the user to use said software. A Product key only allows a user who already has a right to use the software to install said software and activate it"

My thoughts

I think this whole case is very clever from Microsoft as MS does not directly sues everyone who does use a dirt cheap key, but relies on the German law that enforces the law agencies to procecute everyone who is known to have broken a federal law. It again shows that all those keys that are "to cheap to be real" arent.

 

Sources

Windows und Office: Tausende Verfahren wegen unseriöser Microsoft-Lizenzen - Golem.de

Hausdurchsuchungen wegen günstiger Microsoft Product Keys - 100.000 Verfahren gegen Lizenzgo-Käufer! - YouTube

[poochyena]

I assume they would have to prove the buyer had to have known the keys weren't legit. Might be hard to do, or easy, depends on the context.

[Venson]

That is A problem. The offence of the criminal cases are Money lauding. The German agencies will ague that it should have been obvious that those keys could not have been legit as they were to cheep as the difference is dramatically high. An Original Win10Pro key does cost ~200€ and they were sold on Ebay for around 40€. The argumentation is that is could not have been possible that thoes keys could have been obtained legally and therefor the buyer did "participate" in the illegal action.

(Source lawyer Christian Solmeke)

Edited March 8, 2021 by Venson

[Helpful Tech Witch]

Ok, but they would've bought them assuming they were extra OEM keys (what they are usually), and assuming they were legal. So wouldn't that be legal purchase, like buying something without knowing it was stolen?

[Electronics Wizardy]

Just now, HelpfulTechWizard said:

Ok, but they would've bought them assuming they were extra OEM keys (what they are usually), and assuming they were legal. So wouldn't that be legal purchase, like buying something without knowing it was stolen?

Id argue that selling those keys for less than 10% of retal seems really sketchy, and seems like someting weird is going on, and that there sellers also aren't large distrubitors, like CDW or newegg. They also aren't microsoft authorized distrubitor. There are probably enough signs that these are stolen goods.

[Venson]

@HelpfulTechWizard

Well that is the big question here, the law agencies say: "If you buy a brand new car for halve the price you should have known that something is fishy" and the lawyers say: "But my customer brought that from a salesman that has 300 stores and is already 10 years in business, how should we have known?"

[Helpful Tech Witch]

2 minutes ago, Electronics Wizardy said:

Id argue that selling those keys for less than 10% of retal seems really sketchy, and seems like someting weird is going on, and that there sellers also aren't large distrubitors, like CDW or newegg. They also aren't microsoft authorized distrubitor. There are probably enough signs that these are stolen goods.

But most of the time like on eBay, they are legal OEM keys. Just sold because the OEM had too many.

[Electronics Wizardy]

Just now, HelpfulTechWizard said:

But most of the time like on eBay, they are legal OEM keys. Just sold because the OEM had too many.

What makes you think that there oem keys?

 

Also do the OEMs have the ability to re sell them?

 

Also thats a suspicouly low price to sell something for.  Id expect like 50-80% of the new cost, not 5-10%

[Venson]

Add:
Those keys Lizengo distributed originated largely from Asia and are "defacto" legal keys. 

 

In Asia.

Not in europe.

[Helpful Tech Witch]

Just now, Electronics Wizardy said:

What makes you think that there oem keys?

 

Also do the OEMs have the ability to re sell them?

 

Also thats a suspicouly low price to sell something for.  Id expect like 50-80% of the new cost, not 5-10%

I've heard it mentioned that they were usually oem from multiple videos, it believe they mere mostly ltt.

But I may be wrong there, I'm not going through the entire backlog.

[Arika]

31 minutes ago, Venson said:

In a small number of cases, the German department of justice also seem to be conducting house searches when initial investigations were not promising enough.

 

uuuuh why? if it's a software key, it's not like there is going to be physical proof of what they bought. trying to find other things to pin them on?

[leadeater]

12 minutes ago, HelpfulTechWizard said:

Ok, but they would've bought them assuming they were extra OEM keys (what they are usually), and assuming they were legal. So wouldn't that be legal purchase, like buying something without knowing it was stolen?

OEM keys are typically only a bit cheaper and not actually allowed to be resold anyway. Most keys sold on the "grey" market are either stolen OEM keys or stolen MAK keys, MAK keys being a hot commodity. Right now I have access to many many thousands of them that will NEVER get used due to using KMS activation instead but we still get allocated MAK keys. If I were less than ethical I could sell them for cheap and make well over $100k.

[AndreiArgeanu]

4 minutes ago, Electronics Wizardy said:

Also thats a suspicouly low price to sell something for.  Id expect like 50-80% of the new cost, not 5-10%

OEM's don't buy keys at nearly the retail price, if that was the case systems would from 130$ to 300$ more depending on the type of Windows license issued with the system. Most OEM's, especially the big ones like Dell, HP, Asus and so on most likely have some deal with microsoft that allows them to get these licenses for pretty low costs.

 

Additionally the Windows licenses they're selling don't have to be licenses specifically for Windows 10, they could be Windows 7 or Windows 8 since you can still activate Windows 10 with equivalent Windows 7 or 8 keys (e.g. Windows 10 Pro can be activated with Windows 7/8 Professional license or higher.)

[Venson]

1 minute ago, Arika S said:

uuuuh why? if it's a software key, it's not like there is going to be physical proof of what they bought. trying to find other things to pin them on?

But they investigated Lizengo, saw who brougt what and when and for what price because they got all the data. (more does the article not state sry)

[Arika]

3 minutes ago, Venson said:

But they investigated Lizengo, saw who brougt what and when and for what price because they got all the data. (more does the article not state sry)

i know, i read that, but why are they doing house searches of the buyers of these keys from Lizengo?

[leadeater]

1 minute ago, valdyrgramr said:

Wait, if MS doesn't care on the buyer's end then why does the German government?   MS just won't help you, but like if MS isn't pressing charges then what can the government do?

Microsoft doesn't actually need to press charges or lay a complaint, that's only a requirement for civil cases. Criminal cases only the police can lay charges, nobody else, so if the police want to crack down on illegal activity they can do so even against the wishes of any affected companies involved.

[Venson]

Just now, valdyrgramr said:

Wait, if MS doesn't care on the buyer's end then why does the German government?   MS just won't help you, but like if MS isn't pressing charges then what can the government do?

Thats in the fine print of the german constitution. Every buyer is (supposed) to have committed a federal crime (ether Money laundering or Copyright Infringement). As thoese are Federal crimes, the german government law agencies are forced to investigate even if the victim does not want a investigation. So MS just lays its feed up and let the german goverment do everything.

[Venson]

3 minutes ago, Arika S said:

i know, i read that, but why are they doing house searches of the buyers of these keys from Lizengo?

I really dont know, even the lawyer said its unreasonable (from an outside view). Personally I can only suspect they are investigating people who tried to deal with those keys commercially and tried to resell it or brought a high number of keys and are suspected to deal with them. 

[leadeater]

7 minutes ago, valdyrgramr said:

Second argument, it's not copyright infringement because the buyer building a machine is literally, by definition an OEM.   You don't have to make the parts as long as you put them together to create a functioning machine, or do upgrades, to be considered an OEM by definition otherwise most clevo painters would be in trouble there.   Secondly, they're under the assumption that the buyer knew before hand how the seller obtained them.   The court system is riding on a hypothetical, not a fact, and by pushing copyright infringement they're contradicting a definition.   This is why they need reform.

They aren't being charged with copyright infringement, they are being charged with other crimes. Receiving stolen goods is a crime for example.

 

What's happening here is it's a money laundering case and involves financial crimes and receiving of stolen good and services. Copyright and IP have basically nothing to do with it at all.

 

As to OEM keys, resale means you the customer aren't supposed to on-sell it. I can actually buy an OEM key from my local PC store so long as I buy with it a motherboard and CPU. I can sell that OEM key but only if I sell it with that motherboard and CPU, it's supposed to be tied to the system it was originally purchase with. Whether that is actually enforceable is another matter, or one Microsoft wants to enforce but that would be a civil case not a criminal case.

[Venson]

1 minute ago, valdyrgramr said:

 

Second argument, it's not copyright infringement because the buyer building a machine is literally, by definition an OEM.   You don't have to make the parts as long as you put them together to create a functioning machine, or do upgrades, to be considered an OEM by definition otherwise most clevo painters would be in trouble there.   Secondly, they're under the assumption that the buyer knew before hand how the seller obtained them.   The court system is riding on a hypothetical, not a fact, and by pushing copyright infringement they're contradicting a definition.   This is why they need reform.

It could be tho.

- First if thoese where actually OEM keys, the reseller and you would already in breach of contract therefore not having a valid license and using the software without a valid license. (in rougth translation this is considered a copyright infringment)
- Apart from that to be considered to be an OEM you have to sell thoese maschines you have build, therefore using another OEM's license. (Apply same reasoning from point above)

- Again as discussed in a post above, the buyer cannot say they acted in good faith as the whole case rests on the matter that everyone who should have done a basic price comparison should have noticed that thoese are unresonable prices and could not have been obtained legally. It does not matter that the buyer did not know, but they should have been put some thought into it and should have seen that it could not been possible.
 

[Venson]

2 minutes ago, leadeater said:

They aren't being charged with copyright infringement, they are being charged with other crimes. Receiving stolen goods is a crime for example.

 

What's happening here is it's a money laundering case and involves financial crimes and receiving of stolen good and services. Copyright and IP have basically nothing to do with it at all.

 

As to OEM keys, resale means you the customer aren't supposed to on sell it. I can actually buy an OEM key from my local PC store so long as I buy with it a motherboard and CPU.

Well its not that clear in the press, it seem to be both true. I guess it depends from case to case and from key to key. If it was an retail key i guess the goverment goes with copyright infringement (here used for a broader term for a german law) for using a software without license. This seem to be a weaker case.
If the key was an OEM key i guess they go with Money Laundering (for your said reasons) 

[leadeater]

1 minute ago, Venson said:

Again as discussed in a post above, the buyer cannot say they acted in good faith as the whole case rests on the matter that everyone who should have done a basic price comparison should have noticed that thoese are unresonable prices and could not have been obtained legally. It does not matter that the buyer did not know, but they should have been put some thought into it and should have seen that it could not been possible.

Hey want to buy my 2021 LG 80" OLED TV from me, it's only $1000. Going cheap mate, cash only.

 

Spoiler

Yes buying this would be a crime, unless I were actually stupid enough to sell my legally obtained OLED TV for this lol

 

[Venson]

4 minutes ago, leadeater said:

Hey want to buy my 2021 LG 80" OLED TV from me, it's only $1000. Going cheap mate, cash only.

 

  Hide contents

Yes buying this would be a crime, unless I were actually stupid enough to sell my legally obtained OLED TV for this lol

 

You are a private person, maybe you are in need of money its cheep yes? but it is my personal bad luck if it was stolen and i will have it taken from me.

Let me put it this way:

 

Quote

From: CheepKeys24

Hey want to buy one of my 10000x 2021 LG 80" OLED TV from me, it's only $1000 per TV. Going cheap mate, cash only.

That would fit the situation i guess^^

[leadeater]

6 minutes ago, Venson said:

You are a private person, maybe you are in need of money its cheep yes? but it is my personal bad luck if it was stolen and i will have it taken from me.

Let me put it this way:

 

That would fit the situation i guess^^

Actually no, it doesn't need to be 1000x, it just need to be unreasonably cheap at all. That's where the "fallen off the back of a truck" meme comes from. If something is unreasonably cheap and thus suspicious and you buy it knowingly anyway you are susceptible to being charged with receiving stolen goods. If you don't ask for proof of purchase then you have no defense.

 

Edit:

But you are right in that this doesn't match the article, it wasn't supposed to. It's just an example of if a price is too low the buyer is expected to reasonably know that it is suspicious.

[Venson]

1 minute ago, leadeater said:

Actually no, it doesn't need to be 1000x, it just need to be unreasonably cheap at all. That's where the fallen of the back of a stuck meme come from. If something is unreasonably cheap and thus suspicious and you buy it knowingly anyway you are susceptible to being charge with receiving stolen good. If you don't ask for proof of purchase then you have no defense.

Ok but that is not the case in germany AFAIK. If there is no sign that you are buying a stolen good you cannot held liable.

But back to topic: The keys are not in fact Stolen or brought with stolen credit cards or something like that, they are Legal, Original keys. But not where they were used in germany. The whole case rests on the fact that although the keys are legal, users in german do not process a license through the act of buying the key. Much the same as buying a Russian Steam key for 2$ from steam in russia and using it to activate a game on your US steam account were the game would have been costing 20$.