- UK court rejects Microsoft’s arguments against ValueLicensing
- ValueLicensing plans to seek £270m from Microsoft
- Microsoft says it will appeal the decision
The UK’s Competition Appeal Tribunal has ruled that Microsoft cannot prevent its customers from reselling perpetual software licenses, marking the end of a years-long debate.
The debate began in 2021, when ValueLicensing sought £270 million on the grounds that Microsoft was using contracts to prevent the resale of licenses – and although it claimed that the resale of licenses infringed copyright, the company failed to win its case.
The Court concluded that enterprise agreements ultimately create multiple licenses, not a single multi-user license, so no subdivision should take place for the licenses to be resold.
Microsoft lost its license resale file
Since Microsoft’s distribution and reproduction rights do not prevent the resale of parts of licenses in bulk, the Court found the resale lawful.
ValueLicensing also notes that starting around 2011, Microsoft moved perpetual license customers to its Microsoft 365 subscription, forcing customers (like ValueLicensing) to give up or keep perpetual licenses they no longer needed.
Argument number two concerns Office and Windows, including copyrighted non-program elements (like icons, fonts, clip art, and resource/help files). The Court concluded that the purchasers purchased Microsoft’s software as computer programs and not as collections of artistic works. Microsoft therefore also lost this battle.
The Court “unanimously[ly]” came out against Microsoft on both issues.
“ValueLicensing always believed that it was running a legitimate business supported by the principles of the EU Software Directive and the ECJ’s UsedSoft ruling,” said Jonathan Horley, chief executive of ValueLicensing (via The register).
“Now that these preliminary matters have been resolved, we look forward to pursuing the complaint against Microsoft.”
Microsoft said The register he disagrees with the decision and intends to appeal.
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