If WLM was going to check if you had a pirated copy of Windows, then it'd cause WGA or WPA to pop up and nag - cause that's the way Microsoft do things.
My guess would be that there's something gone wrong with his installation of WLM or that his WLM registry / profiles have become corrupt.
I remember I used to have this problem on an older version of MSN however I cannot recall what caused it, sorry.