UK reseller files £270m lawsuit against Microsoft

ValueLicensing claims vendor is abusing its power in the software market

UK software reseller ValueLicensing is suing Microsoft for £270m in damages for illegally abusing its power in the software market, it alleges.

Derby-based ValueLicensing claims to be an expert in buying and selling pre-owned Microsoft volume licences to both private and public sector organisations.

Its website claims that customers can save up to 70 per cent on their software licences by buying used software.

ValueLicensing has filed a legal suit against Microsoft with the High Court in London claiming that the vendor has added clauses into contracts that block customers from reselling their licences, in exchange for discounts on its cloud-based products.

The clauses are coupled with non-disclosure agreements which seek to stifle the preowned licences market, ValueLicensing alleges.

The lawsuit alleges that these practices have been occurring since at least 2016 and has resulted in the firm losing £270m in gross profits.

ValueLicensing's lawsuit is also asking for the High Courts to take measures to fully "restore and maintain competition and choice in the market" by removing NDAs and addressing the Microsoft clauses in customer contracts.

The reseller's founder, Jonathan Horley, told the Financial Times:"Microsoft has an incentive to move to its new cloud-based model and remove the old licences from the market so customers have no choice but to move to its subscription model."

ValueLicensing's filing adds: "Microsoft is the dominant provider of office software applications and operating systems. By suppressing the availability of preowned perpetual licences that compete with its latest Office365 product lines, it has tried to minimise the activities of its reseller rivals.

"Microsoft's illegal behaviour has impacted almost every organisation that provides desktop software for its workforce in the UK and the EEA," added Horley. "ValueLicensing is not the only victim"

Microsoft told CRN that it is unable to comment on ongoing legal cases.