Complaint Review: Applied Business Software - Long Beach, CA Internet

Oh, PLEASE. The rebuttal of Howard Cohn, ESQUIRE, of Applied Business Software, is the usual lawyers masterpiece of redirection. You will note that he does not actually accuse Noble Capital of software piracy, but talks in nice generalities on the problems of software piracy, and makes themselves out as a pitiful, aggrieved party, boo, h*o. As far as I can tell from the Internet, Noble Capital has not been convicted of anything. Ergo, no damage has been determined to Applied Business Software, the client of Howard Cohn, ESQUIRE.



I am someone in the know on this. As a consultant, I have done computer work for a number of Southern California mortgage companies sued by Applied Business Software. So, in the manner of J'accuse, let me start by asking a simple question: who in the computer business sues their clients unless they absolutely can't avoid it. Even Microsoft, a giant, mostly offers to just turn yourself in, pay up, and even get your software licensed at a discount, even keeping in mind the $150,000 per title copied they could collect, as noted by Howard Cohn, ESQUIRE.



Second, why are they asking such odd amounts to settle, and then counter offering so long as it is done in an almost impossible amount of time? I believe it is because they have gotten the demand down to a bit of science. They know the industry, and they know their clients. They demand what they think the client can bear, and from all appearances they are very good at it now.



Third, why so many lawsuits and claims of software violations? If you simply go to Google and search Applied Business Software lawsuit you will see they have sued a number of companies, a list pulled off the Internet in some five minutes:



Freedom Financial              Pacific Mortgage Exchange   Settle Funding Group

Roswell Holdings                Wizard Financial                  American Financial

Allied Mortgage                  Latitude Capital                   Old Canal Financial

Bristol Home Mortgage       Capital City Mortgage           Noble Capital

Pontus Financial                 Citizens Business                 Peninsula Equity Funding

Equity Lending Group         Duke Properties Inc.             Book Works, Inc.

United Capital Investments Capital Transactions Group   Captran Funding

Dayco Funding Corp.          TD Loans                             Quality Home Loans

Home Savings Mortgage



And this is a partial list of the lawsuits.  Many times the user of the software simply gives up early, thinking settling out of court is easier than fighting. But, Applied Business Software is not done there, oh no. All settlement agreements include payment of the settlement, a non-disclosure agreement to shut the client up, and a extended three year software license agreement to prevent the client from quitting Applied Business Software for another vendor. Kind of like continuing to sleep with the man who beat you up. From what I have seen, the tactic works. The clients hate Applied Business Software, but three year done the road many stay as they don't see what else they can do (there is that staying with your abuser scenario, again).



Fourth, the violation claims are bogus in view of modern computing. Nearly all the accused clients are accused of license violations. Normally, software licenses (no commercial company sells you software) are specific: one license per computer. Generally, software companies also have programs for additional licenses with an office or company at a discount. And, many companies license Terminal Server or Citrix licenses to run on a server so one's software can not only accessed by multiple parties, but anywhere in the world. One of the glories of modern computing: on vacation in Thailand, VPN into your computer and see what's going on. I supposed Howard Cohen, ESQUIRE, would also consider i-Pads and Smartphones, all VPN compatible, as violations of the licensing agreement.



Applied Business Software does not see it that way. They regard any computer that accesses their software as a computer that must also be licensed to use the software. Dialing in from home to your licensed office computer? Got to license that computer, too. Forget and use your wife's computer- uh, oh! License violation. Checking in from that beach in Thailand on a friend's computer? License violation. That this view of licensing is completely out of kilter with the general practices of the software industry make no mind to Applied Business Software. Honestly, I am accessing my licensed computer at the office. Where is the monetary violation to Applied Business Software. All I am using is another computer's screen to view my licensed computer.



Fifth, why do they take so long to claim violations? In another post on RipOffReport.com Latitute Capital Management notes that their "violations" went on for quite a while before Applied Business Software cried "piracy foul!". From what I have seen this is typical. Applied Business Software does direct updates of their software via the Internet, and as Latitude Capital noted they must have some way of downloading a tracking file from the client. But, like the patient spider, they wait until the violations accumulate, all the more to "prove" their case. Since they update their software at least once a year they must know of the violations at the end of the first year, yet they may not move until the second or third. What we do know is that when they strike they present the client with a Gantt chart that "proves" the violations. Actually it just shows that more than one computer has accessed the licensed computer. http://en.wikipedia.org/wiki/Gantt_chart


I mean, I guess I would have to own a software company to know, but what software company that really wants to protect their copyright would do business this way?  It is it about selling software licenses?


Sixth, if you have been accessing your office computers remotely, you are already dead! Are you doing it? Do you have employees doing it? Your computer savvy son or daughter who has a family to go home to at night? The deed is done already. I do not think they can access your computer unless you do the software upgrades, so you might be able to avoid litigation moving to cancel you license before the next renewal is due, but remember you will have to do so with three months advanced notice to Applied Business Software before the expiration of your contract. Once you have made the move, refuse to allow them access to your computer system.


Seventh, why sue your clients? This is very confusing to those of us business people who hate dealing with attorneys in general. I will note that Applied Business Software's products are very expensive to purchase initial licenses, but not too bad on the renewal fees. However, if they sue and settle with a client they are collecting, in advance, some 15 to 20 years of renewal fees right up front. And, tax free. Since the average mortgage company exists for about 11 years before being sold or closed for other reasons, this "defense" of their copyright appear to have been very profitable.


Finally, maybe you are asking how can they do this? My answer is simple: Did you really read your contract with them? Did your attorney really read it? Did you all understand the terms? Apparently, a lot of companies and their attorneys did not, and Applied Business Software keeps suing and winning.  If this is such a issue for Applied Business Software, maybe they should have their sales persons emphasize the problem to their prospective clients at the start by offering to sell additional license for remote access.  All of those clients reported to me being blindsided, and the violations were not intension.


So, considering all this, do you want to do business with this company? A company that is suing its own customers? When there are a number of competitors of Applied Business software out there who are not (again, checking the Internet) threatening or suing their customers with some apparent regularity? Up to you, I guess, but I would completely disregard Howard Cohen, ESQUIRE. I would also defy him to actually refute, not talk around, point by point, anything I have written here. I am just shocked the LA Times has not picked this up.

We invite you to visit our website at www.themortgageoffice.com to learn about who we are and view the list of products and services we offer.

 

What is Software Piracy? When you purchase The Mortgage Office™, you are actually purchasing a license to use it, not the actual software. The license is per-computer and limits how many computers can access the software, therefore it’s important to read the license agreement and understand it. If you install or use more copies of the software than the license permits, you are pirating and thus breaking the law. A company or an individual found using unlicensed software and violating copyright laws can pay damages of up to $150,000 for each software title copied.  Additionally, the government can criminally prosecute you for copyright infringement, and if convicted, you can be fined up to $250,000, or sentenced to five years in jail, or both.

 

Economic Impact of Piracy. A recent study found that 4 out of 10 software programs installed on personal computers were stolen, with a commercial value of more than $51 billion.  Software piracy is not a victimless crime. Piracy denies software developers like ABS their rightful revenue and harms customers and the industry as a whole. We at ABS have spent years creating The Mortgage Office™, and much of the revenue generated by licensing is funneled back into research and development, so that newer, more advanced software can be produced. This in turn allows our clients to be more productive and stay competitive.

 

Unfair Competitive Advantage. Moreover, most users of The Mortgage Office™ abide by the license, and it would be a great disservice to them if we stood by silently and allowed their competitors to gain an unfair advantage by paying less for the same number of licenses.

 

About Applied Business Software

Applied Business Software, in business since 1978, is a market leader and global provider of software systems and solutions to the mortgage industry. For additional information about ABS’s products and services, visit http://www.themortgageoffice.com or call (800) 833-3343.

 

Contacts:

Howard Cohn, Esq.

Applied Business Software, Inc

Tel. 562-426-2188