Re: "counterfeit goods"?
See the article linked below, the issue was that he made them look like genuine Dell, Microsoft approved, restore discs. That was very silly.
Imagine if he distributed them only to find that, for example, they contained malware of some kind. This may result in a class action suit against Dell as well as loss of reputation.
Don't get me wrong, I'm certainly no Microsoft (or Dell for that matter) apologist but what he did was counterfeiting even if the product he was counterfeiting has zero value.