If you purchased a business and the sale included all of the business’s computers, would it be reasonable to expect to be able to use the software installed on those computers?
In the recent matter of QAD Inc v Shepparton Partners Collective Operations Pty Ltd  FCA 615, the Federal Court ordered Shepparton Partners Collective Operations Pty Ltd (‘SPC’) to pay $1M+ in damages to software company QAD Inc (‘QAD’), after finding that SPC had infringed copyright after purchasing the business from Coca-Cola Amatil (‘CCA’) without having secured a transfer of the relevant software licence agreement.
- After the sale QAD required payment of a fee as a condition for its consent to transfer the licence, which SPC refused to pay.
- SPC denied that it had infringed copyright, claiming that it had an implied licence from QAD to use the software.
- SPC cross-claimed against Sale Co 1 Limited (‘SaleCo’) and CCA on the basis they had failed to use their ‘best endeavours’ to secure a transfer of the licence agreement.