Archive notice: This article was originally published on September 3, 2008. Links and embedded videos are preserved as part of the historical record.
In Microsoft’s view, transferring rights to use software requires the consent of the rights holder. This was the decision of the Munich Higher Regional Court in its July 2008 ruling in the legal dispute between Oracle and usedSoft. Microsoft believes that the court’s ruling also applies to software licenses from Microsoft volume licensing agreements. If manufacturers’ consent has not been obtained, users may face substantial additional payments. Company management is also liable for violations of IT compliance policies, because companies must assess the risks of used licenses from the perspectives of IT compliance and IT governance. If companies use unlawfully transferred software licenses, they may face legal action for which management can be held liable.
The risk to companies that purchase software licenses that have not been properly transferred is often underestimated. If the transfer proves to have been unlawful, the customer may not use the software again until proper licenses have been purchased or repurchased. The customer may also have to pay damages to the manufacturer.
“Customers can avoid these risks by using dealers in used software licenses that always actively involve the manufacturers and therefore the rights holders. Such dealers act in their customers’ interests. In the event of an audit, it is the company—not the software manufacturer or the dealer—that must prove that the software it uses consists of properly licensed products,” explained Dorothee Belz, Director of Law and Corporate Affairs at Microsoft Deutschland GmbH.
Legal Consequences
Any use of illegal software can result not only in civil-law consequences but also in criminal penalties. In a proven case of underlicensing, companies may face not only the manufacturers’ claims for damages already mentioned. Those responsible within the company may also face substantial fines if they acted intentionally. Even prison sentences are possible.
“If a complaint is filed that gives rise to suspicion of copyright infringement, the public prosecutor’s office can apply to search the business premises and inspect all PCs and licenses. Companies should therefore consider carefully whether they really want to accept the risks associated with underlicensing, and should purchase a corresponding license for every installation. If a customer decides to purchase used software licenses, the customer should insist on involving the software manufacturer,” advised Dr Markus Morawietz, licensing expert and Managing Partner of Dr. Morawietz Consulting & Training GmbH.
