Canada shutters “mod chip” operation

Federal prosecutors charged Robert Garby of Ottowa with selling illegal mod chips and pirated games through his “Kustum Komputers” business. He pled guilty in Ontario Court of Justice in Ottawa to six counts of criminal code violations and copyright law infringement and was fined $17,000 and sentenced to a year of probation.

Sony is one of several game machine makers fighting manufacturers of mod chips, console add-ons that typically have to be soldered to the console’s main circuit board. Once installed, the mod chips typically defeat copy protection measures, allowing machines to play illegally copied discs and discs intended for other regions.

A handful of mod chips for Microsoft’s Xbox game machine have gone into circulation in the past few months, with hackers counting on the chips to allow them to run home brew software such as MP3 players and the Linux operating system. Microsoft representatives have said the company is considering legal action against mod chip makers, but the company has offered no details of any prosecution efforts.

Sony has argued that mod chips are illegal in the United States under the terms of the Digital Millennium Copyright Act, which forbids “circumvention devices” intended to defeat copyright protection technology. While activists say it violates free-speech rights, the circumvention language has been used in several controversial cases, including efforts by movie studios to ban a DVD-cracking tool.

Sony has successfully prosecuted several U.S. operations selling PS2 mod chips, but the chips and modified game machines are still readily available from overseas retailers, such as Hong Kong’s Lik Sang.

“Sony Computer Entertainment America has been fighting circumvention devices like these within U.S. borders for years,” Riley Russell, general counsel for SCEA, said in a statement. “We are pleased that our neighbor to the north has recognized the illegitimacy of these devices under applicable law.”