• UK tribunal says Microsoft licenses can be legally resold
• Ruling rejects Microsoft’s copyright claim; company plans to appeal
• Decision clears path for reseller’s £270M damages case to proceed
Microsoft says it will challenge a decision by the UK Competition Appeal Tribunal (CAT) that strikes at the heart of its long-standing restrictions on reselling software licenses. The tribunal ruled that perpetual licenses for products such as Windows and Microsoft Office can legally be resold—rejecting Microsoft’s argument that such activity infringes its copyright.
The case dates back to 2021, when UK reseller ValueLicensing sued Microsoft over contractual terms that barred customers from reselling previously issued licenses. The reseller argued that these restrictions violated the principles of the European Software Directive and had cost the company millions in lost revenue.
Microsoft initially fought the claim on contractual grounds, but later advanced a copyright infringement theory. Because Office programs include interface elements such as icons and graphics, the company argued they should be treated as original artistic works, making license resale a copyright violation.
Judges dismissed that argument, saying the presence of such graphics does not convert software licenses into copyrighted creative works that restrict resale. Customers holding perpetual licenses are free to resell them, the tribunal said—echoing a decade-old precedent set in the UK’s UsedSoft case.
The ruling could make it easier and cheaper for UK consumers and businesses to obtain Windows 11 or Office through the secondary market if it holds up on appeal.
ValueLicensing says decision validates its business
“ValueLicensing has always believed it was running a legitimate business underpinned by the principles of the European Software Directive and the UsedSoft judgment at the ECJ,” the company’s managing director said following the ruling. “This judgment confirms these principles, which legitimately allowed ValueLicensing to save its customers money on used Microsoft software.”
The company said it now plans to refocus on the core of its lawsuit, which seeks damages for what it alleges were unlawful restrictions that hampered its business.
Case moves to damages phase — and more litigation awaits
With the copyright argument dismissed, Microsoft will need a new defense as the lawsuit proceeds. If it ultimately loses, the company could face millions in damages to ValueLicensing.
But the financial risk doesn’t end there. Microsoft is also tied up in a separate, similar class-action suit alleging abuse of market dominance and anti-competitive licensing practices—exposure that could reach into the billions.
For a company long accustomed to accusations of restrictive contracts and inflated pricing, the latest rulings add to a familiar pattern of legal headaches. Yet with Microsoft’s valuation supercharged by the AI boom, the litigation may amount to little more than a costly distraction for the tech giant.