Microsoft software resale appeal catches eye of £3.5B class action

Court of Appeal hearing in ValueLicensing dispute may shape parallel proceedings

The Microsoft and ValueLicensing legal tussle will enter an appeals phase this month, attracting the attention of a multibillion-pound class action against the Windows giant.

The appeal, due to be heard on April 28 and 29, follows a ruling by the UK Competition Appeal Tribunal (CAT) in November that the resale of perpetual licenses for Microsoft software was not illegal. Microsoft disagreed with the decision, and a spokesperson told The Register at the time that the company intended to appeal.

The case has rumbled on for years, starting with ValueLicensing suing Microsoft for £270 million in 2021 over alleged clauses in contracts that prevented customers from reselling perpetual licenses in return for favorable subscription terms.

After years of protesting its innocence, Microsoft made a surprising pivot in 2025 and attempted to make the case about copyright. Office, for example, includes help files and imagery, not just code. Microsoft argued that reselling this material would infringe its copyright.

The judge disagreed and Microsoft appealed. A trial could happen in 2027.

If Microsoft were to win its appeal, it could have major implications for the secondhand software market in the UK. As well as potentially overturning previous judgments, it could affect pending cases too, such as the Alexander Wolfson class action, which was brought against Microsoft over alleged licensing practices that it claims cost UK customers dear.

A 2025 filing [PDF] contained a statement that the proposed class comprised "an estimated 2.3-2.7 million members" and "a preliminary estimate is that aggregate damages are between £1.3 billion and £3.5 billion, accounting for interest."

The claim period runs from October 1, 2015, to May 12, 2025.

Given what is at stake, representatives from the class action have shown keen interest in the ValueLicensing case and the upcoming appeal. The Register understands that an intervention was requested and has seen documentation indicating it was granted.

As a result, the class action team will be permitted to attend court.

Microsoft declined to comment on the development, and Stewarts LLP, the litigation law firm supporting the class action, did not respond to a request for a statement.

Jonathan Horley, Managing Director of ValueLicensing, told The Register: "ValueLicensing is aware of the importance of the Court of Appeal hearings. The jurisdiction appeal deals with whether the CAT can decide non-competition law issues (like copyright). Microsoft believes this is a complete answer to the Wolfson claim because they say that those copyright issues cannot be transferred to the High Court in the context of a class action. That is the reason why the Wolfson team has been granted permission to turn up at the jurisdiction hearing.

"The copyright appeal will affect multiple other claims, including the Wolfson class action proceedings. If found in Microsoft's favour, it would overturn parts of the pre-Brexit ECJ decision UsedSoft vs Oracle, and whether the European Computer Programs Directive even applies to Microsoft Office and Windows.

"ValueLicensing looks forward to returning to the main competition law issues including the pending applications on further disclosure and the Confidentiality Ring, after this appeal has concluded and the Stay is lifted." ®