E-waste recycler hit with 15-month prison sentence for selling Windows restore discs

Eric Lundgren, a prominent e-waste recycler, has been sentenced to 15 months in prison and hit with a $50,000 fine for producing thousands of Windows restore discs, The Washington Post reports. The sentence comes as an appeals court upheld a previous decision, ruling that his infringement cost Microsoft $700,000.

From The Washington Post:

The appeals court upheld a federal district judge's ruling that the disks made by Eric Lundgren to restore Microsoft operating systems had a value of $25 apiece, even though they could be downloaded free and could be used only on computers with a valid Microsoft license. The U.S. Court of Appeals for the 11th Circuit initially granted Lundgren an emergency stay of his prison sentence, shortly before he was to surrender, but then affirmed his original 15-month sentence and $50,000 fine without hearing oral argument in a ruling issued April 11.

In all, Lundgren had produced 28,000 restore discs and planned to sell them for 25 cents apiece to computer refurbishers. The idea was that refurbishers could then provide the discs to people buying computers so that they wouldn't have to go through the hassle of creating their own restore discs.

Ultimately, the discs were seized by U.S. customs officers in 2012 and were never sold. Lundgren and a Florida broker he was dealing with, Robert Wolff, were charged with conspiracy to traffic in counterfeit goods and criminal copyright infringement as part of a government sting, The Washington Post reports.

Restore CDs are typically provided for free with computers that are loaded with a licensed version of Windows, and the software can be downloaded for free. The license itself is ultimately what costs money, and users would need a valid license to use the restore discs. Through Lundgren pleaded guilty, he argued that the discs had no value. The court ultimately ruled that the value of the discs came in at $25 apiece.

In a statement to The Verge, Microsoft said:

Microsoft actively supports efforts to address e-waste and has worked with responsible e-recyclers to recycle more than 11 million kilograms of e-waste since 2006. Unlike most e-recyclers, Mr. Lundgren sought out counterfeit software which he disguised as legitimate and sold to other refurbishers. This counterfeit software exposes people who purchase recycled PCs to malware and other forms of cybercrime, which puts their security at risk and ultimately hurts the market for recycled products.

Lundgren told The Washington Post that he's been given a couple of weeks to get his affairs in order before surrendering. However, he worries that the case has set a precedent for companies to pursue those like him who are seeking to extend the life of older computers.

"I am going to prison, and I've accepted it," Lundgren told The Washington Post. "What I'm not okay with is people not understanding why I'm going to prison. Hopefully my story can shine some light on the e-waste epidemic we have in the United States, how wasteful we are. At what point do people stand up and say something? I didn't say something, I just did it."