The Story of Eric Lundgren and Why it Should Scare You

In today’s world it is an unfortunate tragedy that when people meet someone they don’t know they go home and Google them. Because of Google, I don’t think there is a day that goes by that I meet someone new, and after Googling me they finally get up the guts to ask me about prison. To the people I meet in my everyday life, prison is as foreign a concept as they can get their minds around. Before I get to what a real prison is really like, not what you see in the movies or read in books or the plethora of highly produced slick “reality” TV shows supposedly about prison, I want to talk about two very divergent cases that have made the headlines. Bill Cosby and Eric Lundgren. These are both confounding cases and, in their own way, highlight the insanity of our existing judicial system. The case of Eric Lundgren, like Aaron Swartz, is yet another pathetic and disgusting example of prosecutorial abuse for the personal political and personal advancement goals of yet another prosecutor in this country. The case of Bill Cosby provides a real conundrum where maybe there just aren’t any good answers. I want to take the case of Eric Lundgren first as it is such a glaring example of the perpetual stupidity of prosecutors running amuck yet again, and judges hamstrung by irrational sentencing guidelines.

The Case of Eric Lundgren

Thirty-three-year-old Eric Lundgren built a business out of recycling electronic waste. He is a renowned innovator in the field of electronic waste, sometimes called “e-waste”. He has used discarded parts to do things such as construct an electric car. He built the first “electronic hybrid recycling” facility in the United States, which turns discarded cellphones and other electronics into functional devices, slowing the stream of harmful chemicals and metals contained in those devices into landfills and the environment. His company, IT Asset Partners, processes more than 41 million pounds of e-waste each year and counts IBM, Motorola and Sprint among its clients.

One of his projects was to manufacture thousands of “restore discs,” supplied by computer makers as a way for users to restore Windows software to a hard drive in case it crashes or must be erased. The discs can only be used on a computer that already has a license for the Windows operating system, and the license transfers with the computer for its full life span.

Eric Lundgren had 28,000 of these restore discs made and shipped to a broker in Florida. Their plan was to sell the discs to computer refurbishing shops for about 25 cents apiece, so the refurbishers could provide the discs to used-computer buyers. The new user would be able to use the disc to keep their computer going the next time a problem occurred. Refurbishing a used computer rather than putting it in the junk pile is a large step in starting to solve the problem of the mountains of electronic waste in our environment. Refurbishing is a recycling program for the mounting problem of electronic waste.

In 2012, U.S. Customs officers seized a shipment of these discs and began investigating. Eventually, a Florida broker called Lundgren and offered to buy the discs that were not confiscated or sold as part of a government sting operation. The Florida broker sent Lundgren $3,400 for the refurbished discs and the government had in their opinion now manufactured a crime they could prosecute and promote in their press releases and garner laudatory headlines. Both the Florida broker, whose name was Robert Wolff, and Lundgren were indicted on a charge of conspiracy to traffic in counterfeit goods and criminal copyright infringement. In return for his cooperation in setting up the government sting against Lundgren, Wolff made a plea deal and received a sentence of six months of home arrest.

Given mandatory sentencing laws, Eric Lundgren had no choice but to plead guilty but argued that the value of his discs was zero, so there was no harm to anyone. His point was that neither Microsoft nor any computer manufacturers sell restored discs, and but for Lundgren’s e-waste restoration project, the discs had no value. Microsoft supply’s the discs for free with new computers and make the software available for free downloading for those who already have paid for the software and received a license. That license remains active as long as you own the computer. Lundgren was simply making the discs available again for those who needed them in refurbished computers. The discs could only be used on already licensed computers. No harm no foul right? Not according to U.S. prosecutors who indicted Lundgren.

Defying all logic, the judge in Eric Lundgren’s case decided that the restored discs had a value of $700,000, and that under mandatory sentencing guidelines, that amount qualified Lundgren for a 15-month prison term, along with a $50,000 fine. The prosecutor told Lundgren he could have a couple of weeks to put his financial affairs in order, including plans for his company of more than 100 employees. They also told Lundgren that if he spoke to the media they would have the U.S. Marshalls pick him up and put him in prison immediately. Of course, when all these got out and started making headlines, the U.S. attorney’s office was asked to comment but declined to do so.

Why 15 months in prison? Why did federal prosecutors decide to make this a criminal rather than civil case? The answers are enraging! Eric Lundgren, the U.S. government, and Microsoft all agree on the facts of the case. In 2011, Eric Lundgren was living in China, working with various brokers in the U.S., to source cheap generic parts to fix up electronics. One of the brokers, Robert Wolff, approached Lundgren and asked him if he would use a shop in China to create duplicates of restore CD’s which could then be resold to computer refurbishers in the U.S. The duplication business in China that Lundgren used duplicated the CD exactly including reprinting the Dell and Microsoft logos on top of the discs, clearly showing you needed a preexisting license in a preexisting computer to use the discs. Despite this, in 2012, the government intercepted a shipment of these duplicated CDs, and in their unfettered wisdom, determined the discs to be “counterfeit” and approached and coerced Wolff into setting up Lundgren. Wolff, understandably petrified and wanting to save his own skin, cooperated with the authorities and ordered and bought $3,400 worth of the duplicated CDs under a government sting operation to entrap Lundgren. When the shipments arrived, the CDs were seized, Lundgren’s home in Florida was raided, and he and Wolff were indicted by a grand jury.

Eric Lundgren, facing the threat of a decade or more in prison, did what almost all defendants do and pleaded guilty to get a lesser sentence. Since there was no trial, the majority of Lundgren’s time in court was simply determining his sentence. Federal sentencing guidelines say that for conspiracy to traffic in counterfeit goods and criminal copyright infringement, you need to determine the retail value of the goods. Lundgren’s 28,000 CDs were irrationally valued by the judge at $25 apiece, with a total value of $700,000. Lundgren could have faced between 37 to 46 months in prison, but the judge had some discretion and he lowered the sentence to 15 months. The Assistant U.S. District Attorney prosecuting Lundgren’s case told Lundgren, “Microsoft wants your head on a platter, and I’m gonna give it to them.” Of course, again the U.S. District Attorney’s office declined to comment, and Microsoft went into complete damage control mode saying they had nothing to do with Lundgren’s prosecution.

Now remember, like the Aaron Swartz tragedy, an abomination where MIT did not press charges but still the prosecutors pursued the case with vindictive zeal, in this case as well, Microsoft DID NOT press any charges against Lundgren. I could spend 10 pages of single space type as many people in the tech community have done, clearly demonstrating that Microsoft saw no harm and that the copied discs had little to no value and that no one in the case was harmed, but that is not the point of this blog. The point of this blog is why in God’s earth is Eric Lundgren going to prison? And since Microsoft didn’t file any claims against Lundgren, why did prosecutors spend taxpayer money to put a person that was doing a great service to the “e-waste” industry in recycled parts, in jail? Where is the public good here?

Eric Lundgren had zero criminal record, was not violent and was not a menace to society. There were zero victims or complainants yet we spend millions and millions of taxpayer money to put this guy in jail? Please someone out there in the internet explain to me why?

Like in the Martha Stewart and Aaron Swartz cases in my previous blogs, and thousands of other and similar cases, the simple answer is the only reason Eric Lundgren is going to jail is because prosecutors advance their careers by convictions, headlines and publicity – and that is the ONLY reason Lundgren is going to jail! Lundgren’s case is just another in a never-ending list of unnecessary imprisonment caused by judges, with little time to learn the facts, hampered by insane sentencing guidelines, and over-aggressive and zealous prosecutors trying to make a name for themselves. The real question though is why was this a criminal case at all? Nobody seems to be focusing on this! If Lundgren really stole value from Microsoft, why didn’t Microsoft just sue Lundgren and/or get an injunction? Like in countless other cases, what should have been a civil dispute with civil remedies was needlessly and wantonly turned into a criminal case, wasting millions of dollars of taxpayer money and needlessly ruining lives!

Eric Lundgren’s story is but another in a long long list of very sad cases. Lundgren will soon be sitting in a jail cell for making duplicates of software that you can legally download for free! That should really worry us all as to how easily any of this could happen to any of us, if for whatever reason, we are unknowingly and wrongfully drawn into the sights of another overzealous prosecutor. Yes, in our criminal justice system, fascism is alive and well and that is a problem eventually all of us will sooner or later have to face.

Lawrence Goldfarb’s new book, From Hell to Eternity, will be released in 2018. Sign up to receive news, information and updates.

Lawrence Goldfarb's new book, From Hell to Eternity, will be released in 2018. Sign up to get the latest updates.

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