Microsoft Corp said it is suing Britain's second-largest electronics retailer Comet for allegedly creating and selling counterfeit recovery CDs of its flagship Windows operating system.

In a statement on its website, Microsoft said the retailer created more than 94,000 sets of Windows Vista and XP recovery CDs and sold them to customers buying Windows-loaded PCs and laptops.

A recovery disk is used to reinstall the operating system in a PC in case of system failure.

It is disappointing that a well-known retailer created so many unwitting victims of counterfeiting, David Finn, associate general counsel at Microsoft for worldwide anti-piracy & anti-counterfeiting, told Reuters in an email.

In 2008 and 2009, Comet approached tens of thousands of customers who had bought PCs with the necessary recovery software already on the hard drive, and offered to sell them unnecessary recovery discs for 14.99, Finn said.

Comet is owned by Kesa Electricals, Europe's No. 3 electronics retailer, but is in the process of being sold to private equity group OpCapita.

A Kesa spokesman told Reuters that Comet provided the disks as a service to its customers between March 2008 and December 2009, but stopped the practice when Microsoft objected.

He said Comet sold the disks as many buyers of PCs and laptops did not create their own recovery CDs and faced problems when their computers failed.

There was a number of disks made, on which there was a cost and Comet charged this to the customer.

Comet believes the supply of the recovery CDs was in the best interests of its customers and has a good sense of its claim and will defend its position vigorously, he said.

Microsoft's Finn said customers can secure the recovery disks directly from computer manufacturers for free or a minimal amount.

The case was filed in the high court in London.

(Reporting by Himank Sharma and Tresa Sherin Morera)

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