FBI Arrests Father, Son in CD-ROM Piracy Probe : Software: Thousands of counterfeit computer games are seized in the first major case of its kind.

In the first major case of CD-ROM piracy in the United States, the FBI said Thursday that it has seized thousands of counterfeit copies of the popular CD-ROM computer games “Rebel Assault” and “Myst” and prevented the production of tens of thousands of additional copies.

A father and son who authorities say were the alleged masterminds behind the operation were arrested in Buffalo, N.Y., and charged with two felony counts of copyright infringement. Peter Misko, 63, of Mississauga, Canada, is free on $15,000 bail; his son Bruce Misko, 36, of Chicago is free on $25,000 bail.

Whereas theft of diskette-based computer software has long been relatively commonplace in the United States, authorities say that counterfeit CD-ROMs--which are much harder to produce than diskettes--are just now beginning to appear in the U.S. software market in large quantities.

The FBI is continuing a sting operation aimed at CD-ROM counterfeiters, and officials said additional warrants were served Thursday in Indiana and New Hampshire as part of a crackdown on retail stores selling the bogus software. More arrests are expected.

Software companies have been up in arms about piracy for years, and they are dismayed--if not surprised--to see the problem spread to the increasingly popular CD-ROM format. The specialized equipment needed to duplicate CD-ROMs has grown dramatically cheaper in the past year.

“We are now beginning to see counterfeit copies of our mainstream CD-ROM applications being sold here, including Microsoft Office, Encarta and Bookshelf, for a fraction of their retail value,” said Alison Gilligan, senior anti-piracy specialist for Microsoft Corp. “As more and more PCs become multimedia-capable, the counterfeiters will focus on multimedia CD-ROM applications where there is money to be made.”

Robert Roden, general counsel for LucasArts Entertainment Co., which makes “Rebel Assault,” said the company, working with the Royal Canadian Mounted Police, tracked the alleged CD-ROM pirates through a complex series of dummy corporations in several Canadian cities before it brought in the FBI when the trail led to Buffalo.

George Lucas, producer of the “Star Wars” film trilogy and owner of LucasArts, recently vowed to vigorously protect the firm’s copyrights and trademarks. “We don’t take any form of piracy lightly, including software piracy,” he said in a statement.