Microsoft is fighting to stop you from selling your old perpetual Windows and Office licenses. After losing twice in UK courts, the company is now seeking permission to take its case to the Supreme Court, and a recent procedural order gives it time to do so while allowing part of the case to move forward.

On July 21, the UK’s Competition Appeal Tribunal (CAT) extended a stay of proceedings in the long-running ValueLicensing case. The pause applies to the main damages trial but exempts two applications—one for disclosure of documents and one for confidentiality arrangements—which can be heard at a case management conference in September. The order gives Microsoft breathing room to ask the Supreme Court to review the Court of Appeal’s July 7 ruling that the resale and subdivision of perpetual licenses does not infringe its copyright.

What the latest court order actually changes

The extended stay, described by the CAT Chair as a “middle ground,” prevents the bulk of the litigation from proceeding while Microsoft prepares its Supreme Court bid. If permission is granted, the trial will remain on hold until the appeal concludes. If permission is refused, the CAT can lift the stay and move toward a full trial on competition issues.

Crucially, ValueLicensing’s applications for further disclosure and confidentiality will continue. These are not administrative formalities. They will shape what internal Microsoft documents and evidence can be obtained and how commercially sensitive material is handled. The CAT explicitly recognized that ValueLicensing has already prevailed at first instance and on appeal, and that allowing these applications to progress is fair and proportionate.

This is not a clean reset for Microsoft. The company lost its argument that the CAT lacked jurisdiction to hear copyright-related competition claims. It lost its argument that Windows and Office contain non-program elements—icons, graphics, clip art—that put them outside the software exhaustion rules that permit resale. And it lost its argument that volume licenses cannot be subdivided for resale. The July 21 order merely delays the next stage, while keeping the evidentiary groundwork alive.

Your right to resell: What this means for different users

For everyday consumers and small businesses, the rulings strengthen your ability to legally sell an unused perpetual license for a product like Office 2019 or Windows 10 Pro. If you bought a retail copy, and you decommission the software on your own machine, you can transfer the license to someone else. The case also endorses the idea that a company can split a bulk purchase—selling 500 of its 1,000 unused licenses, for example—making the second-hand market far more practical.

For IT professionals managing enterprise estates, the decisions open a potential path to recovering value from surplus licenses as you migrate to Microsoft 365. But the door is not wide open. Volume licensing agreements often contain specific clauses, and you must diligently document what you are selling. The CAT’s 2025 preliminary ruling was explicitly tied to the sample transactions before it; each resale still requires its own compliance check.

For developers and system builders, the courts’ handling of incidental graphics and UI elements matters. The Court of Appeal accepted that the products are, in substance, computer programs, and that tacking on a handful of icons does not transform them into something governed by a different, more restrictive copyright regime. That reasoning may offer some comfort when assembling custom images or evaluating open-source components that include non-code assets.

The long road to a second-hand software market

The current legal posture is the product of years of litigation and a key European precedent.

  • July 2012: The Court of Justice of the European Union rules in UsedSoft v Oracle that a copyright holder cannot prevent the resale of a “used” software license if the original acquirer ceases use. The distribution right is exhausted on first sale, even for downloaded copies.
  • 2021: JJH Enterprises, trading as ValueLicensing, sues Microsoft for £270 million, alleging that restrictive contractual practices choked off the supply of pre-owned perpetual licenses and harmed competition.
  • November 2025: The CAT issues a preliminary ruling. On the facts of the sample transactions, it finds that Microsoft’s copyright does not block resale or subdivision of the licenses, and that icons, clip art, and other non-program elements do not change the essential character of Windows and Office as software.
  • July 7, 2026: The Court of Appeal dismisses Microsoft’s appeal. The judgment notes that Microsoft’s argument would lead to “odd results,” such as allowing resale of CD-ROM copies but not downloads. The court holds that the non-program works are incidental and that the CAT was right to treat the products as computer programs for exhaustion purposes.
  • July 21, 2026: The CAT grants an extended stay while Microsoft seeks permission to appeal to the UK Supreme Court. ValueLicensing’s disclosure and confidentiality applications are carved out and can proceed.

A parallel class action, spearheaded by Alexander Wolfson, could push the stakes even higher. The claim, which represents millions of UK consumers and businesses, carries a preliminary damages estimate of between £1.3 billion and £3.5 billion, including interest. That action is distinct but closely watches the same copyright and competition questions.

How we got to a Supreme Court bid

Microsoft’s original defense focused on its commercial terms. When that looked shaky, the company shifted to a copyright argument: that Windows and Office contain protected graphic works and other non-program elements, and that these fall outside the UsedSoft principle, which covers only “computer programs” under the Software Directive. Microsoft also argued that a volume license could not be split into smaller blocks for resale.

The CAT’s 2025 ruling rejected both arguments. On the samples before it, the tribunal held that the software is, in substance, a computer program, and that the ancillary elements are integral to its intended use. The Court of Appeal agreed, adding that Microsoft’s theory would allow any software vendor to circumvent UsedSoft by embedding a few icons or clip art, rendering the decision meaningless.

The subdivision question was equally significant. Microsoft insisted that a buyer of 1,000 licenses who keeps 500 and sells 500 infringes copyright, or that a reseller who splits a bulk purchase violates the terms. The Court of Appeal disagreed, drawing a distinction between the client-server setup in UsedSoft and a collection of independent, functionally equivalent copies of Windows or Office. Since each license grants a standalone right to use, subdivision is permissible.

How to safely buy or sell a used license today

The legal ground is firmer than it was, but the market is not a free-for-all. Activation is not the same as compliance. Here is what to do now.

If you are buying a used license:
- Vet the seller. Demand original purchase documentation—order confirmations, invoices, or entitlement certificates.
- Verify the license type. Retail and select volume licenses are more likely to be transferable; OEM licenses tied to hardware may not be.
- Insist on a contractual warranty that the seller has decommissioned the software and that the license is genuine.
- Remember that a key that activates today may fail an audit, a hardware change, or a future migration. Provenance matters.

If you are selling an individual or enterprise license:
- Gather and preserve all original purchase records, including agreement numbers and true-up records.
- Before selling, confirm that you have ceased using the specific software copy and have not retained any duplicate benefit.
- If the license was part of a volume agreement, check the terms for transfer restrictions or bundling with Software Assurance or cloud subscriptions.
- Use a specialist broker or legal advisor who understands software asset management and the UK-specific legal framework.

For IT departments managing transitions to Microsoft 365:
- Conduct a thorough license inventory. Many organizations have drawers of perpetual licenses they no longer need but never documented.
- Keep perpetual licenses separate from active subscription benefits. Avoid selling a license that is still tied to a cloud tenant or active support.
- Consider the financials realistically. The resale value of older Office or Windows versions may be modest, but for large estates it can be meaningful. Weigh it against the administrative effort and the risk of a future adverse ruling.

What comes next

The legal timetable now hinges on whether the Supreme Court grants permission to appeal. If it refuses, the CAT can lift the stay and set the damages trial in motion—a trial that will examine whether Microsoft’s practices actually distorted competition and, if so, what compensation ValueLicensing is owed. That could happen in 2027.

If permission is granted, the Supreme Court would likely hear the case in late 2027 or 2028, and the stay would remain until a final judgment. The questions at issue—exhaustion of software copyright, subdivision of volume licenses, and the treatment of incidental non-program works—are of sufficient general importance that a hearing is conceivable.

In the meantime, the disclosure and confidentiality applications will proceed, potentially adding to the public record about how Microsoft structured its licensing deals. And the separate Wolfson collective proceedings will continue to advance in parallel, with potentially huge financial consequences.

For now, the courts have drawn a line: your perpetual Office and Windows licenses are not locked in a drawer. They have resale value, and that value is legally protected. Microsoft is still trying to redraw the line, but it has not succeeded yet.