Eric Lundgren is resigned to doing prison time. After spending his life working on e-waste recycling programs, Lundgren was arrested and charged with “counterfeiting” Microsoft restore discs, part of a controversial, years-long legal fight that ended this week when an appeals court declined to overturn a lower court’s decision.
Lundgren, who’s also an electric vehicle inventor, ordered a shipment of the discs and provided them to a Florida broker, with plans to move them on to computer refurbishers. The broker eventually asked Lundgren to personally purchase them instead — only for Lundgren to discover the sale was part of a government sting operation.
In court, Lundgren pleaded guilty but argued that the value of the discs was zero, as the software was made freely available online to restore broken computers. But the courts sided with the prosecution, which was assisted by Microsoft. The company said in a statement this week that providing software as Lundgren did “exposes people who purchase recycled PCs to malware and other forms of cybercrime, which puts their security at risk and ultimately hurts the market for recycled products.”
Lundgren will soon serve out his 15-month sentence. He spoke on the phone with The Verge this week after the decision.
This interview has been edited for length and clarity.
Can you tell me a little bit about your background?
I grew up in a little, tiny town in the middle of nowhere in Washington, right up by the border. When I moved there it had 14,000 people and everybody was a farmer. I went to my local bank and cashed an $84 check and my bank said, “You can’t cash it right now because our computers are being upgraded.”
I went to go leave and there was this giant pile of computers in front of the exit. I said, “What are you going to do with those?” She said, “We can’t throw them away, because we heard that they’re very toxic, and so we need to find a computer recycler.” So I just turned 16 years old, and I have a beat-up truck, and I said, “Well, I’m a computer recycler,” and I became a computer recycler that day.
That ended up turning into me recycling for my school, and helping to pay for school buses, and then that turned into getting all of the retired veterans that were at the senior citizens center involved. Eventually I’m almost 17 years old and I’m driving down to Seattle picking up corporate computers, truckloads of them.
At the age of 17, I just moved to Los Angeles with $100 in my pocket and went to go visit my brother that was going to USC. He was struggling to pay for his tuition and I said, “Well, let’s just start a company doing recycling.” Before I knew it I’m this 17-year-old kid that’s responsible for all of the recycled computers for American Airlines, every year, worldwide. Then that grew and I ended up building up a company, working with many Fortune 500 companies.
But I wasn’t really solving the e-waste problem, and it was haunting me. So I followed the e-waste, all of the stuff that we throw away that’s non-repairable to US standards, and I followed it over to Hong Kong and I watched it go over to China. I befriended some people there and they taught me the ropes of how to re-use parts and components, and it bothered me so bad what I saw over there, that I had to go find a solution for e-waste.
Can you describe your arrest and the legal situation that followed?
I was at a meeting with RadioShack in Dallas, Texas when federal agents at five o’ clock in the morning-ish busted down my door with masks and guns and raided my house and took all of my electronics.
The second that I realized what it was regarding …. [that] I had potentially cost Microsoft millions and millions of dollars and the whole nine yards, I hopped on on a red eye flight from Dallas, flew directly to the US attorney’s office and sat and waited for the agents and the assistant US attorney to meet with me. I explained to them exactly what this was regarding and I said, “Look, these are restore CDs, there’s no licenses, you can download them for free online, they’re given to you for free with your computer. The only way that you can use them is [if] you have a license, and Microsoft has to validate it. Have you spoken to Microsoft about it?”
They said, “We don’t care, we think you’re a criminal, and I’m sorry but Microsoft wants your head on a platter and I’m going to give it to them.” Those are the words that the US attorney said to me in that meeting, face to face. There’s really nowhere to go from that. I told them, “I’m a computer recycler, I have no criminal history, I am not a criminal. You can look into this all you want, but I’m not going to go to prison over this because this isn’t a crime, unless it’s a crime to help people and help the environment.”
He said, “You’re going to prison one way or another. You can sign this paper today and go to some nice, cushy ‘Club Fed’ or just roll the dice and see what happens.” A week and a half before the statute of limitations, I received 21 federal indictments. That was a scary day.
Meanwhile I’m running three different recycling companies and had just gotten back from my second trip to Ghana. I’m literally devoting my time to humanitarian work and then I get this indictment and I go, “Shit, now I’ve got to focus on this.”
I thought, “I just need to educate the government about what this is now,” and it became a giant lesson in educating the United States government on what a restore CD was.
Walk us through the core dispute. What do restore CDs do, and how do you feel the government and the courts misunderstood or misinterpreted what they do?
The discs that I was selling refreshed your computer back to its original standpoint when you bought it. It’s a restore CD, it restores your computer back to your settings when you bought your computer, back when it was fast and back when everything worked right and there weren’t any glitches and there’s no missing DLL files and there was no viruses and all that. When you come to a point when you get this blue screen on this computer, or your computer’s just slowing down, and you say, “Heck, I want this to operate like it used to.” You pop in the restore CD, click enter enter enter, and put in the Microsoft code that you can only get from Microsoft, that’s found on your computer. You type that in and Microsoft validates it and says, “OK, you have the right to use this,” then validates your license that you paid for from Microsoft. You basically get to reload your existing operating system on your legally owned hardware.
But the government was comparing restore discs to something else?
They were comparing it to a new license. You don’t get a license with the restore CD. The government treated the infringed item as if it was a licensed product, the license itself, what Microsoft sells, and it’s not. It’s the thing that today Microsoft gives you for free. That was the big misunderstanding. Microsoft treated the restore CD as if it was a new, licensed operating system, and it’s not. It is a repair tool that can only be used to repair your computer’s existing operating system.
I started doing this because my grandmother’s computer got messed up. She took it to Best Buy, [and] it went to Geek Squad. Geek Squad said, “To restore your operating system it’s going to cost $180.” She bought a new computer, [but] her old computer was fine, and that inspired me to go, “Holy shit, people in America don’t realize how to fix their product and are not given the tools they need to keep these things alive.” It wasn’t a money-making venture. I didn’t make any money doing it. I actually lost money doing it. The goal was to get these [to] refurbishers so they could put them in the boxes and then consumers down the road could repair the problem.
When the discs got to America, they sat in the broker’s garage for a long time because the refurbishers had already made their own, so they didn’t need them. Eventually I got a call from a broker and he said, “Hey, I want to buy all of them from you and I’ll pay you 20 cents a piece, here’s this $3,400, will you take it?” What I didn’t realize was that that money was a sting operation from the United States government. So my only buyer that I ever had was the US taxpayers through a sting operation.
Why is Microsoft being so zealous about this?
Here’s why. I got in the way of Microsoft’s multi- multi- multi-million dollar business model of recharging people for computers that already have an operating system. Now they can use this case law and my case to really hit home all the refurbishers out there that know me, and there’s a lot that do. It’s a multi-billionaire industry, but it’s a very tight-knit small community. They get to go to every refurbisher and say, “We don’t have to come after you civilly any more, we can come after you criminally, and we can put you in prison. So do you want to pay us the $25 times 50,000 operating systems that you need this month, or do you want to risk it?” I honestly believe that this is a tactic to solidify a business model that is very wasteful and very harmful for society.
Aside from the legal part, are there any personal plans that you’re making right now with your business or with your family ahead of this?
I stepped down as CEO and we hired a really good team, so they’re doing great. My other companies are suffering. I’m in the process of building the world’s longest-range electric semi that I want to drive from the west coast to the east coast on a single charge, and I’m actually building that. The problem is they’re not going to let me build that in prison. So that one stops, the work in Africa stops, because I was leading that charge. There are things that will stop. The company will not, it’s going to go do great things.
I’m going to make the best of it. I’ll turn lemons into lemonade. I’ll get in there and figure out a way to change the prison system so that when I leave it’s a better place for the people who aren’t getting to leave, and I got a book deal out of it. A really big publisher and a really great ghostwriter want to write a book with me, and not specifically this, but just my lifetime fighting e-waste and what I care about and trying to share that message with the world. I want to write a book in prison about trying to find joy, trying to be the happiest that I’ve ever been in my entire life in prison. I really want to see if it’s possible to find the most amount of joy that I have ever had in my entire life in an atmosphere that’s designed to steal that from you.
I’m not staying in that long and when I get out I’ll continue to do the work that I do today, but if the conversation gets started like it has, if people start realizing and paying attention to e-waste, to planned obsolescence, to the right to repair movement that’s taking over the country, if I can be a cog in the wheel of that progress in society, if I can help the world evolve past being primitive neanderthals that throw everything in a hole in the ground that leeches harmful chemicals into our water table and the food we eat and the water we drink and the air we breathe, if I can help the world in that way, then hell yeah I’m willing to go to prison for that.