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    Samsung Counterfeiting Video
Games, Says Nintendo 01/18/95
REDMOND, WASHINGTON, U.S.A., 1995 JAN
18 (NB) -- Nintendo of America has
filed suit in Federal District Court
in Seattle, alleging that Korea-based
Samsung Electronics counterfeited
hundreds of thousands of copies of
Nintendo's Donkey Kong Country and
other copyrighted Nintendo video
games.

    Donkey Kong Country was
introduced in late 1994 and sold
about six million copies in the first
40 days after its release. The
company estimates it will sell in
excess of 10 million copies by the
end of 1995.

    According to Nintendo, the
counterfeit cartridges have been
discovered on the market in Asia,
Latin America, Europe, the Middle
East, and North America, including
the US. The company also alleges that
Samsung has supplied components
containing Nintendo software to at
least one of two major government
owned and operated Chinese software
companies. Nintendo said the illegal
games often sell at half the
suggested retail price.

    The lawsuit asks for immediate
termination of illegal production,
seizure of all inventories, full
disclosure of information about the
distribution network, monitoring of
future production, monetary damages,
and other relief.

    Howard Lincoln, chairman,
Nintendo America, called this
instance "perhaps the most troubling"
of all the counterfeiting uncovered
over the years due to the long-term
business relationship between
Nintendo and Samsung. Lincoln said
Samsung is one of the few companies
in the world capable of producing the
specialized components used in
Nintendo games, including the 32-bit
Mask ROM (read-only memory) chips
used in Donkey Kong Country.

    "For Samsung to be involved in
this kind of black market operation
is outrageous," said Lincoln.

    Nintendo's suit alleges that
Samsung illegally manufactured the
ROM chips that contain both the video
and audio information for the game.
The company said that, while the
black market version of the game may
look and sound like the authorized
version, the quality of counterfeit
products is often substandard.
Nintendo said counterfeiting costs
the company as much as $3 billion
annually.

    Nintendo said that, although the
counterfeit Donkey Kong Country games
were discovered at the Winter
Consumer Electronics Show two weeks
ago, Samsung had been placed on
notice by Nintendo at least 18 months
ago because of other counterfeit
cartridges incorporating components
bearing the Nintendo name and log.
Nintendo said although it has
repeatedly written to Samsung and met
with its representatives it has
"received no satisfaction."

   Nintendo spokesperson Perrin
Kaplan told Newsbytes it is just
about impossible for a buyer to tell
whether a Donkey Kong cartridge is
authentic by looking. Her advice is
to buy only from reputable dealers.
She also points out that the game has
a suggested retail price of $69.95
and if it is being offered for a lot
less than that by a retailer, it
should be considered suspect.
However, it takes a lab examination
to know for sure, said Kaplan.

    (Jim Mallory/19950118/Press
contact: Alison Holt Brummelkamp,
Nintendo of America, 206-861-2877)


    AT&T & Sprint In 900-Number Class
Action Suits 12/19/94 ARLINGTON,
VIRGINIA, U.S.A., 1994 DEC 19 (NB) --
A recent, little noted federal court
decision in Augusta, Georgia, could
cost AT&T and Sprint billions of
dollars, according to a published
analysis in the industry journal,
Telecom & Network Security Review.

    The article, by John Haugh, a
contributing editor, reports that a
November 22 decision by US District
Judge Dudley Bowen Jr. has certified
three lawsuits -- known as the
Andrews, Harper and Sikes cases -- as
class action suits.

    The actions, originally filed in
Augusta, Georgia, 1991 and 1992, seek
damages from AT&T and Sprint because
of fraudulent 900-number schemes. The
plaintiffs claim that the LDCs (long
distance carriers) aided the schemes
by supplying them with 900-number
service. The class action
certification means plaintiff's
counsel can seek damages for all
victims throughout the US who were
defrauded by the 900-number schemes.

    In all these suits, the
plaintiffs claim wire fraud, mail
fraud, and federal racketeering
(RICO) violations. Actual damages
claimed could come to $1 billion,
says the analysis. The racketeering
charges could treble the damages to
nearly $4 billion.

    The schemes involved inducing
victims to call a 900 number in hopes
of receiving some benefit, including
major credit card approval despite
bad credit, prizes from "play-along"
TV game show quizzes, or prizes in
different games of chance. In all
cases, the main result of calling was
a large phone bill the following
month.

    Haugh says that in the past three
years, the scam is believed to have
grossed $1.5 to $4.5 billion.

    In his analysis, Haugh says the
implications go beyond the potential
liabilities of AT&T and Sprint. Other
LDCs, RBOCs (regional Bell operating
companies), local phone companies,
and billing services could become
lawsuit targets as well.

    MCI was named in two of the
suits, said Haugh, but settled out of
court for $60 million. Of that total,
$43 million will be paid in the form
of free phone service to 900-number
fraud victims and $17 million in
attorneys fees and costs. MCI agreed
to mount a national campaign to
notify victims of the settlement.

    Haugh noted that hearing about
the settlement may encourage other
victims to come forward in the AT&T
and Sprint actions.

    AT&T and Sprint have asserted
various defenses, including that they
have "no way of knowing" what takes
place through the telephone lines
they "merely lease" to 900 scam
artists, said Haugh.

    Telecom & Network Security
Review, a bimonthly newsletter
recently acquired by Pasha
Publications of Arlington, Virginia.

    (Craig Menefee/19941219/Press
Contact: Beth McConnell, 703-816-
8639, or Harry Baisden, 703-816-8617,
both of Telecom & Network Security
Review)


     Electronic Testing Privacy &
Copyright Suit 01/03/95 PRINCETON,
NEW JERSEY, U.S.A., 1995 JAN 3 (NB) -
- The Educational Testing Service
(ETS) has filed suit against Kaplan
Educational Centers, a test
preparation firm, alleging violations
of the Electronic Communication
Privacy Act and copyright laws.

    Meanwhile, Kaplan has signed a
letter of agreement with ETS stating
that, for the next two weeks, Kaplan
employees will not "take" and then
recreate the computerized version of
the ETS's Graduate Record Examination
(GRE), actions that are the source of
ETS's complaint.

    In an interview with Newsbytes,
Jose Ferreira, GRE director for
Kaplan, acknowledged that Kaplan
employees surreptitiously sat for and
then reproduced the computerized GRE.
But, he asserted, the Kaplan
employees took these actions to
demonstrate that students can easily
"cheat" on the computerized ETS test
by remembering and later
reconstructing the questions.

    Ferreira told Newsbytes that the
computerized version of the GRE
differs from the traditional pencil
and paper edition in both content and
method of administration.

    The computerized version, first
launched in 1993, can generally be
taken throughout the year, and is
most often administered at Sylvan
Learning Centers, according to
Ferreira. In contrast, the pencil-
and-paper test is offered about four
or five times annually, typically at
colleges and universities.

    Additionally, unlike the pencil-
and-paper version, the computerized
GRE contains questions that are
recycled from one test to the next,
he reported.

    In a press release issued
December 31, ETS said that, together
with Sylvan and the GRE Board, the
company had filed suit against Kaplan
in the US District Court for
Maryland. ETS explained the legal
action as an attempt to prevent
Kaplan from "continuing to steal
questions" used on the GRE.

    According to Ferreira, ETS and
Kaplan then signed a letter of
agreement on January 2 stipulating
that ETS would not take or reproduce
the GRE for the next two weeks, and
also that ETS and Kaplan would hold
talks over that period of time in an
attempt to work out a permanent
agreement.

    Also on January 2, the