A group of retailers in Maryland have pleaded guilty to selling modified Xboxes, called "Super Xboxes" by the group, thereby violating the Digital Millennium Copyright Act. The four retailers were owners and employees of Pandora's Cube, a shop with two locations in Maryland and one in Virginia.
The clerks would install chips into Xboxes themselves that thwarted the system's protection scheme. Once that was done, users could download and play games via the system's hard drive, which was also swapped out for a higher-capacity model than the standard 40-gigabyte drive.
The mere act of voiding the protection mechanisms was enough under the DMCA to pose a legal threat to the retailers, and the Pandora's Cube employees would furthermore pre-load the systems' hard drive with discounted copies of games, an obvious additional copyright violation.
The guilty pleas were entered on May 18th. The first sentence will be handed down on July 19, with the sentences for the other three guilty parties scheduled to be delivered in August. The maximum penalty for first-time violators of the DMCA is five years in prison along with a $250,000 fine, plus possible damages paid to Microsoft.
"The commercial manufacture and sale of circumvention devices like the Super Xbox serves only one purpose: facilitation of large-scale piracy," said Acting Assistant Attorney General John C. Richter of the Criminal Division. "Such piracy and the resulting illegal windfall for these few comes at the expense of the many Americans who labor to keep our nation at the forefront of technological advance."