Jjh Enterprises Ltd (Trading as Valuelicensing) v Microsoft Corpn
| Jurisdiction | UK Non-devolved |
| Court | Competition Appeal Tribunal |
| Year | 2026 |
2025 Sept 9, 10; Nov 12
Copyright - Infringement - Computer software - Defendants selling bulk perpetual licences for software products - Products incorporating non-program works - Defendants disputing legality of claimant’s sale of pre-owned licences - Application of copyright exhaustion to bulk licences of software - Effect of contractual terms prohibiting further transfer - Whether first online sale exhausting rights of non-program works incorporated in software -
The defendants sold in bulk perpetual licences for their computer software products. The claimant vendor of pre-owned licences alleged that the defendants were stifling the supply of pre-owned licences by agreeing to provide certain large customers with discounts to its subscription-based services, subject to their agreeing terms as to the surrender or retention of the perpetual licences they no longer required. The claimant contended that those terms amounted to anti-competitive agreements contrary to article 101 of the FEU Treaty, and/or the defendants’ conduct was abusive contrary to article 102. The defendants’ argument that there was no lawful resale market in which the claimant could participate raised issues concerning the copyright exhaustion regime in Parliament and Council Directive 2009/24/ECF1 (the “Software Directive”) and Parliament and Council Directive 2001/29/ECF2 (the “Infosoc Directive”). The Competition Appeal Tribunal ordered the hearing of preliminary issues directed to determining (i) whether the distribution and reproduction rights enjoyed by right-holders prevented the sub-division and resale of the user right obtained by the first acquirer of the products under article 4(2) of the Software Directive, and (ii) whether under article 4(2) of the Software Directive and/or article 4(2) of Infosoc Directive the first sale of the software with the right-holder’s content exhausted the distribution or reproduction rights of the non-program works, such as a graphic user interface, clip art, user manuals, helpfiles and typefaces/fonts, incorporated within the products.
On the determination of the preliminary issues—
Held, (1) that exhaustion under article 4(2) of the Software Directive operated by law and was not limited by contractual terms in an agreement with the right-holder and its customer; that it took place once the first sale was made and was not suspended pending examination of the later activities of the first acquirer or circumscribed by, or conditional on, those acts; that if the first acquirer did not render unusable its own copy following resale it might infringe, but that did not affect the validity of what was purchased; that correctly analysed, the agreements between the defendants and their customers were not for a single licence for multiple devices but contracts for multiple licences; and that on the facts of three sample transactions, the distribution and reproduction rights enjoyed by the defendants did not prevent the subdivision and resale of the user right obtained by the first acquirer of the products (post, paras 96, 102, 108).
(2) That although under the Infosoc Directive online distributions of non-program works were communications to the public to which exhaustion did not apply, the present case was not about the protection of non-program works per se; that the defendants had decided to incorporate the non-program works as ancillary to computer programs to be downloaded and copied with those programs and be sold as a whole within the European Union; that they had consented to the works being first sold in the EU in products which were predominantly computer programs and which products were sold and purchased for their computer program functionality; and that in those circumstances, the defendants should not be able to use the provisions of the Infosoc Directive to erode or adversely affect the lex specialis of the Software Directive which protected the computer programs but which also protected those who purchased computer programs put on the market in the EU with a right-holder’s consent (post, paras 178, 183–184, 186).
The following cases are referred to in the judgment of the tribunal:
Bezpečnostní softwarová asociace—Svaz softwarové ochrany v Ministerstvo kultury
Case I ZR 129/08A (unreported) 17 July 2013,
Case I ZR 08/13 (unreported) 11 December 2014,
Club Hotel Loutraki AE v Ethniko Simvoulio Radiotileorasis
Deutsche Grammophon Gesellschaft GmbH v Metro SB Großmärkte GmbH & Co KG
Football Association Premier League Ltd v QC Leisure
JJH Enterprises Ltd (trading as ValueLicensing) v Microsoft Corpn
JJH Enterprises Ltd (trading as ValueLicensing) v Microsoft Inc
Nederlands Uitgeversverbond v Tom Kabinet Internet BV
Nintendo Co Ltd v PC Box Srl
Oracle America Inc (formerly Sun Microsystems Inc) v M-Tech Data Ltd
Peak Holding AB v Axolin-Elinor AB
Safarov v Azerbaijan (Application No 885/12) [
Sony Computer Entertainment Europe Ltd v Datel Design and Development Ltd
Top System SA v Belgium
UsedSoft GmbH v Oracle International Corpn
Valve Corpn v UFC-Que Choisir
Wright v BTC Core
The following additional cases were cited in argument or referred to in the skeleton arguments:
AFM and SAG-AFTRA Intellectual Property Rights Distribution Fund (trustees of the) v Secretary of State for Science, Innovation and Technology
Allied Wallet Ltd, In re
CILFIT Srl v Ministero della Sanita
Consorzio Italian Management v Rete Ferroviaria Italiana SpA
Criminal Proceedings against Ranks
Espada Sánchez v Iberia Líneas Aéreas de España SA
FT v Belgium
Fairchild v Glenhaven Funeral Services Ltd
Firma Brita GmbH v Hauptzollamt Hamburg-Hafen
Ford Motor Co v Wheeltrims SARL
Funke Medien NRW GmbH v Germany
Iconix Luxembourg Holdings SARL v Dream Pairs Europe Inc
Italian Republic v Eurallumina SpA
JJB Sports plc v Office of Fair Trading
Kwantum Nederland BV v Vitra Collections AG
LLC Eurochem North-West-2 v Société Générale SA
Lenovo Group Ltd v Telefonaktiebolaget LM Ericsson
Martin Y Paz Diffusion SA v Depuydt
Marussia Communications Ireland Ltd v Manor Grand Prix Racing Ltd
Match Group LLC v Muzmatch Ltd
Navitaire Inc v easyJet Airline Co Ltd
Olympus UK Ltd, In re
Peek & Cloppenburg KG v Cassina SpA
Peterson v Google LLC
SAS Institute Inc v World Programming Ltd
Sky plc v SkyKick UK Ltd
Società Consortile Fonografici (SCF) v Del Corso
Software Incubator Ltd v Computer Associates (UK) Ltd
THJ Systems Ltd v Sheridan
Vereniging Openbare Bibliotheken v Stichting Leenrecht
Walter v Steinkopff [
PRELIMINARY ISSUES
The claimant, JJH Enterprises Ltd (trading as ValueLicensing), was a supplier of pre-owned software licences. It brought a damages claim in the High Court against the defendants, Microsoft Corpn, Microsoft Ltd and Microsoft Ireland Operations Ltd, alleging that they were engaged in conduct to stifle the sale of pre-owned licences for their software products in breach of section 18 of the Competition Act 1998, articles 102 and/or 101 of the FEU...
Get this document and AI-powered insights with a free trial of vLex and Vincent AI
Get Started for FreeStart Your Free Trial of vLex and Vincent AI, Your Precision-Engineered Legal Assistant
-
Access comprehensive legal content with no limitations across vLex's unparalleled global legal database
-
Build stronger arguments with verified citations and CERT citator that tracks case history and precedential strength
-
Transform your legal research from hours to minutes with Vincent AI's intelligent search and analysis capabilities
-
Elevate your practice by focusing your expertise where it matters most while Vincent handles the heavy lifting
Start Your Free Trial of vLex and Vincent AI, Your Precision-Engineered Legal Assistant
-
Access comprehensive legal content with no limitations across vLex's unparalleled global legal database
-
Build stronger arguments with verified citations and CERT citator that tracks case history and precedential strength
-
Transform your legal research from hours to minutes with Vincent AI's intelligent search and analysis capabilities
-
Elevate your practice by focusing your expertise where it matters most while Vincent handles the heavy lifting
Start Your Free Trial of vLex and Vincent AI, Your Precision-Engineered Legal Assistant
-
Access comprehensive legal content with no limitations across vLex's unparalleled global legal database
-
Build stronger arguments with verified citations and CERT citator that tracks case history and precedential strength
-
Transform your legal research from hours to minutes with Vincent AI's intelligent search and analysis capabilities
-
Elevate your practice by focusing your expertise where it matters most while Vincent handles the heavy lifting
Start Your Free Trial of vLex and Vincent AI, Your Precision-Engineered Legal Assistant
-
Access comprehensive legal content with no limitations across vLex's unparalleled global legal database
-
Build stronger arguments with verified citations and CERT citator that tracks case history and precedential strength
-
Transform your legal research from hours to minutes with Vincent AI's intelligent search and analysis capabilities
-
Elevate your practice by focusing your expertise where it matters most while Vincent handles the heavy lifting
Start Your Free Trial of vLex and Vincent AI, Your Precision-Engineered Legal Assistant
-
Access comprehensive legal content with no limitations across vLex's unparalleled global legal database
-
Build stronger arguments with verified citations and CERT citator that tracks case history and precedential strength
-
Transform your legal research from hours to minutes with Vincent AI's intelligent search and analysis capabilities
-
Elevate your practice by focusing your expertise where it matters most while Vincent handles the heavy lifting
