Benjamin Appelbaum, Attorney at Law

Microsoft takes legal action in licensing case

Many people and businesses have experience with Microsoft products. This was true for Community Health Systems based in Franklin, Tennessee. However, it may have used its products in a potentially illegal manner. Microsoft has sued Community Health Systems for willful breach of contract as well as willful copyright infringement. According to a license agreement between CHS and Microsoft, CHS cannot rent, lease or lend Microsoft software.

It is also barred from hosting or distributing those products. The companies have had a licensing relationship for the past 17 years, and the general terms of their relationship say that Microsoft has the right to assure compliance with them. Microsoft says that started a compliance process in 2016, but that CHS didn't provide enough data to ensure that it was adhering to the terms of the agreement.

According to Microsoft's complaint, CHS has allowed divested interests to continue using its products. It asks that CHS hand over data to determine how the software has been used and that an on-site audit be completed. Furthermore, it asks for monetary damages that would be determined at the conclusion of a trial. In a statement, Microsoft said that CHS had plenty of time to resolve the matter without the need for legal action to be taken.

If a licensee fails to honor the terms of a licensing deal, the licensing party may choose to take legal action. The licensee could be liable for damages related to breach of contract and copyright infringement. An attorney may be able to review a case to determine if the terms of a licensing contract were violated. If they were, it may be possible to take action to resolve the matter both in and out of court.

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Benjamin Appelbaum, Attorney at Law - Intellectual Property

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