Legal Question in Technology Law in Massachusetts

Re: If someone sells a PC with a pirated OS, is the money they get illegal?

If they have actual or constructive knowledge ( meaning they have a basis for suspecting), then YES, they would be subject to prosecution for a variety of federal and state criminal statutory violations, not the least of which would be selling stolen property, and (c) violations.

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Re: If someone sells a PC with a pirated OS, is the money they get illegal?

Nobody has the right to sell something he doesn't own, unless the owner has authorized him to act as her agent. If the buyer believed at the time of purchase the OS was legit and later learned that it wasn't he can demand a refund, though he would have to return the computer in order to get it.

You ask whether "the money they get" is "illegal", which is a somewhat vague question. The seller would have to refund the money to the buyer if demanded and might have to surrender it to the software company if it sues him, or he might have to forfeit it as part of a criminal penalty if he is prosecuted. If none of these things happens, though, he should have no problem; merely having the money is legal even if the way he obtained it was not.

If the seller uses the proceeds to buy something else he will be its legal owner. Here again he can be required to pay money to the buyer and/or the software company, and could be required to pay criminal penalties as well, but he could pay these off with any assets and would not have to surrender the particular items he bought with the proceeds. Indeed, there is usually no way to tell whether the money used in a given transaction came from any particular source among the many sources of the buyer's income.