TL;DR

Microsoft is seeking Supreme Court permission to appeal the ValueLicensing ruling that pre-owned software resale is legal. It lost at the CAT and Court of Appeal. A related class action could reach billions.

Microsoft is seeking Supreme Court permission to appeal the ValueLicensing ruling that pre-owned software resale is legal. It lost at the CAT and Court of Appeal. A related class action could reach billions.

Microsoft is seeking permission to appeal to the UK Supreme Court after losing twice in the ValueLicensing case over whether businesses can legally resell surplus on-premise software licences. The Competition Appeal Tribunal ruled in 2025 that resale and subdivision of Microsoft licences did not infringe copyright. Microsoft appealed and lost again on July 7. An extended stay was granted on July 21 while Microsoft pursues what The Register called “one more roll of the dice.”

ValueLicensing sued Microsoft for £270 million in 2021, claiming the company inserted contractual clauses to push customers toward Microsoft 365 subscriptions and blocked them from reselling their perpetual licences. Microsoft argued that reselling its software was illegal under copyright law. Both the CAT and Court of Appeal disagreed. The Court of Appeal noted that Microsoft’s approach would produce “odd results,” including a distinction where CD-ROM software could be freely resold but digitally delivered software could not, and that adding “some icons or clip art” to a programme would be enough to circumvent EU precedent on secondhand software.

The stakes extend far beyond £270 million. A related class action represented by Alexander Wolfson bears several similarities to the case and could result in a multibillion-pound payout. If the Supreme Court refuses to hear Microsoft’s appeal, or hears it and rules against the company, the precedent would establish that businesses across the UK and potentially Europe can freely resell unused Microsoft licences. Microsoft’s AI tools found a record number of vulnerabilities in its own software this year, but the legal vulnerability in its licensing model may prove more expensive.

The stay does not cover all proceedings. ValueLicensing’s disclosure and confidentiality applications will proceed, with a case management conference expected in September. Users moved away from Google after its AI overhaul changed the product they relied on, and Microsoft’s push from perpetual licences to subscriptions is a parallel forced migration. The difference is that ValueLicensing is arguing the push was not just a business strategy but an illegal restraint of trade. Two courts have agreed. Microsoft needs the third to disagree.

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