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Your work, prices and honesty will get you much further than trying to directly turn this guy in. This is my opinion and also my philosophy.
Telling your customer will make him aware and keep him as a customer if he cares about what you are telling him. If he doesn't care about the copyright part then your prices most likely will bring him back from what you stated about your competitor. In turn, him and other customers will refer you and your customer base will grow. Some may care about the copyright issues but many seem to be put their imphasis on greenbacks.
Never ever directly bad talk your competitor in saying how he does this or that. Walk around it and just tell them the honesties of the situation and they will figure out what is implied about the competitor.
Good luck with your business.
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If you really want to understand - try changing it.
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