Microsoft claims the companies sold pirated software or computers loaded with pirated software.

The suits were filed in federal courts against companies in Colorado, Georgia, Illinois, New Jersey, New York, Ohio, and South Carolina.

They are intended to protect Microsoft's software revenue and its reseller partners, who stand to lose business when users by pirated software, the company said.

The 26 cases filed Friday were aimed at companies that sell illegal and pirated Microsoft products to businesses and consumers.

In each of the cases, Microsoft first sent a warning letter to companies it believed were selling pirated software. If the company continued the practice, Microsoft then filed a lawsuit.

Sales International LLC of Conyers, Georgia, for instance, is accused of trafficking in counterfeit Windows 98, Windows 2000, and Windows XP authenticity labels, while the Chicago Computer Club Corp. allegedly distributed illicit versions of Office Professional 2003. Perhaps the strangest cases on the list are the two against companies that have been in trouble before over the exact same issue. Pearl River Computers (NY) and Microcomp Solution Inc. (CO) are both accused of illegally distributing copies of Office 2003 even though both firms had previously settled claims with Microsoft regarding software piracy. Either there's a lot of money to be made in piracy, or some folks simply enjoy hoisting the Jolly Roger.

But Chu Son, a co-partner in Denver-based Microcomp Solutions Inc., said he never received a warning letter before a lawsuit was filed accusing him of selling pirated Office copies.

Son, who settled 2001 charges over Windows sales, said his company mainly repairs computers and rarely sells Office. He believes the allegedly pirated copy came from a batch of 10 or 15 licenses he purchased on eBay, which he believed were legitimate.

"I'm more angry than anything else that these guys, just because they're big and stuff, you know, they're just throwing their muscle around," he said.

Justin Harrison, whose company Sales International LLC was among those sued, also was indicted by a federal grand jury. The Oxford, Ga. resident is accused of selling certificates of authenticity that, the prosecutor says, were meant to vouch for software that was actually illegitimate. COA's are a very commonly pirated part of Microsoft Software as they act as the license for the software.

Harrison's lawyer, Steve Sadow, said he hadn't seen the Microsoft lawsuit. But, responding to the federal charges, he said that his client was selling legitimate copies of Microsoft software obtained from legitimate sources.

Gathering Evidence

Microsoft gathered evidence against the defendants through several means. In some cases, complaints were received through Microsoft's anti-piracy hotline. In others, Microsoft purchased computers from the defendants as part of a "secret shopper" program to find dealers selling pirated software.

The Business Software Alliance (BSA), an industry group backed by several software companies, including Microsoft, reported in May that 21 percent of software sold in the U.S. is pirated. That rate is the lowest in the world, according to a BSA list of the 20 countries with the lowest piracy rates.