First off, I'm very sympathetic to Farl here. Having a herd of feds in your house must have been a nightmare. I'd consider it a victory if I didn't wet my pants ;) And don't take this is a flame, because it's not - it's an attempt to start a discussion.
Frankly, however, this whole story smells like a big pile of bullshit to me.
You said, "As for the FBI acting as the watchdog of some poor little font company (and YES! this is about FONTS! of all things)..."
It's incredibly difficult to create a good typeface from scratch, electronically or manually. There are tens of thousands of fonts in existence and most of them are crap. But some are beautiful, and truly enhance your reading experience. In many very important ways it's an art form. Think of Coca-Cola, the most valuable brand in the world. That "Coca-Cola" logo is part of their success - it's their identity - and you'd recognize that typeface anywhere on anything.
Dude: known to you, your server hosted unlicensed copies of commercial fonts for download by 3,000 people. What could possibly convince you that this isn't enabling theft?
I know people who do art for a living. If someone came into Kristen's gallery and started taking photos off the walls, or sculpture of the shelves, she'd be justifiably outraged. She worked hard to create that art, and she's willing to part with it, but only for a price. It's valuable to her. It's what she does. Do you think it's reasonable for an artist, or anyone with unique creative talents, to want to be paid for her work?
I think it is. I think that my skills are valuable to myself and others, and I expect to be compensated fairly for excercising them. I support the rights of all other persons to own their own unique works and to have complete freedom to set the terms under which they will part with those works (corporations "owning" work created by their employees is another, more sordid, debate).
So you also said that a font designer asked you to remove fonts from your server, and you complied. That was polite of him to ask nicely, and very good of you to comply. But you know what? He's not obligated by law or custom to ask you. He's perfectly within his rights to ask the government to enforce it's laws. If someone were distributing (or owned the means of distribution for) copyrighted works of mine, the revenue from which was putting bread on my table, I might not ask nicely. I might be pissed. I might call the FBI and bust his ass (copyright is a Federal law, after all, and that's what the FBI ~supposedly~ does: enforce Federal law). (I would certainly not do this; I can't imagine hating anyone enough to sic the FBI on him).
Your "legal agreement" is meaningless, of course. My rights cannot be legally violated just because you and someone else form an agreement. And some things cannot be agreed away. Jack Kevorkian found that out the hard way when he killed someone who asked, even begged, to be killed. The government is notoriously unsympathetic to such agreements. A 12-year-old cannot legally agree to have sexual relations with a 20-year-old. Etc.
But finally, whether or not the FBI locks you up forever or not (I sincerely hope not; realistically, it's unlikely that any of these companies lost significant revenues due to your actions), the bottom line here is not legal, it's moral. Again, do you think it's reasonable for an artist, or anyone with unique creative talents, to want to be paid for her work?
If you say "No" then I don't consider you a reasonable person, and we can end the debate right here.
If you say "Yes" and really believe it, then please tell me how this jives with your actions. I see a huge disconnection. If you really believed that, why were you not vigilant about removing potentially illegal software from your system? This is analogous to putting up a database of credit card numbers, then offering to remove a number if the legitimate owner asks. How's he even going to find out about it, never mind ask?
As an aside, I'm fully aware of some of the scary repercussions of this. Do we want online service providers to be held legally liable for their content? Can you sue E-Bay or Geocities because one of their users posts something (potentially) illegal? What about individuals operating warez servers for hundreds/thousands of people (no accusations - really - just an example)? What about for 5 friends? What about for 1 close friend?
You see - it's hard to draw the line. I'm not attempting to draw the line. But I do think that you're stepping farther over it than you like to admit, Farl.
FuzzyMan45: Stupidity as a weapon of mass destruction. Great idea, but how would you weaponize it? KWillets: Television