Canoga Park Importer : Pirated Atari Video Machines Seized in Raids
Officials at Atari Corp. said Monday that they worked with federal agents on a sting operation to seize 2,000 pirated video game machines and accessories from a Canoga Park importer, the first such seizure in the United States.
The target of the operation was PSD Inc., which Atari officials said was raided by federal agents Dec. 8.
Federal authorities were unavailable for comment.
But Victor Grigorian, president of PSD, confirmed in a telephone interview with the Associated Press that the machines imported by his company had been seized by federal agents as contraband.
Grigorian said he “never, never knew” that the computers and other equipment were counterfeit.
He said he ordered the machines from a magazine published in Taiwan.
Worldwide Counterfeiting
The equipment, worth more than $100,000, is just a small part of a worldwide computer counterfeiting effort by several companies based in Taiwan, said Atari’s corporate counsel, Joshua Tropper. He said the counterfeiting costs Atari millions of dollars a year.
“The vast bulk of the pirated machines are being distributed in the Far East, Middle East and Latin America,” Tropper said.
“This is the first shipment we are aware of coming into the United States.”
The seized machines were copies of the popular 2600 models, which retail for up to $50, while the pirated 2600s often sell for $25 or $30, company officials said.
Atari became aware of the pirated goods entering the United States when one of its distributors in Los Angeles was asked by PSD whether he was interested in buying machines for resale, Tropper said.
The distributor contacted Atari officials at the company’s headquarters in Sunnyvale, who set up a sting operation to buy the equipment with the help of agents from the U.S. Customs Service and the office of the U.S. Marshal, Tropper said.
2-Part Operation
The operation was carried out in two parts. The first was a Dec. 8 raid on PSD’s warehouse, and the second was the seizure Thursday of a shipping container with the computers at the Port of Los Angeles, Tropper said.
Also seized was “a substantial volume of counterfeit video game cartridges and videotapes,” Tropper said.
The importing of counterfeit computers is a “serious concern of Congress,” said Richard Bernhardt, Atari legal administrator, who said he enlisted the support of Rep. Ernie Konnyu (R-San Jose) in coordinating the sting.
U.S. District Court Judge Terry Hatter issued a permanent injunction against PSD to prevent it from selling Atari counterfeits.
But Atari is not pursuing further legal action against the importer, Bernhardt said. Tropper said PSD officials “are cooperating with us at the moment with the hope we’ll be merciful with them. They are small fish.
“We’re trying to snare the manufacturers in Taiwan,” he said.
‘Hurts Industry’
Tropper said three or four Taiwan companies have sold “tens if not hundreds of thousands” of copied Ataris.
“It’s hurting our country’s industry, depressing sales and affecting the development of new technology,” said Sam Tramiel, Atari president.
In some countries, Atari’s sales have been cut up to 80% by the copies, Bernhardt said.
“Our Singapore distributor is very, very concerned,” Bernhardt said. “He usually sells 5,000 or 6,000 of the 2600s a year. This year, he sold 1,000, which he blames on the knockoffs.
“These are side by side on the shelves and are even advertised as ‘Atari-compatible 2600’ or ‘TV Game 2600.’ They come in the same silver-colored package, and the housing is the same except for the name strip.”
“It’s an industrywide problem,” Tropper said.
“It’s sort of like a balloon in that as soon as one manufacturer clamps down real hard, pirates retool and start knocking off another product.”
