Judgment of the Tribunal concerning the trial of two preliminary issues in a claim brought by JJH Enterprises Limited (trading as ValueLicensing) against Microsoft.
The Tribunal was asked to determine, first, whether the subdivision and resale of Microsoft Windows and Microsoft Office licences originally acquired under Microsoft’s Enterprise Agreements was permissible, and secondly, whether resale was permissible at all pursuant to exhaustion principles, because Microsoft Windows and Microsoft Office contain copyright in non-program works such as a graphic user interface, clip art, user manuals, helpfiles and typefaces/fonts.
The Tribunal concluded on the facts of this case, by reference to the Sample Transactions, as follows:
(1) On the first issue, exhaustion under Article 4(2) of the Software Directive operates by law and is not limited by contractual terms in Microsoft's Enterprise Agreements. Further, the distribution and reproduction rights enjoyed by Microsoft in their products do not prevent the subdivision and resale of licences obtained by the first acquirer.
(2) On the second issue, the first online sale of Microsoft Windows and Microsoft Office in electronic form exhausts the distribution and/or reproduction right under Article 4(2) of the Software Directive in all works supplied and inevitably downloaded as part of those products, to the extent those works are distributed, downloaded and copied in accordance with the intended purpose for which Microsoft Windows and Microsoft Office were first sold.
