July 3 (Bloomberg) -- Oracle Corp., the largest maker of database software, should lose a court challenge seeking to prevent a German company from reselling Oracle software licenses, the European Union's top court said.
Software copyright owners can't oppose the resale of "used" licenses that enable the use of software downloaded from the Internet, the European Court of Justice said today. Oracle is trying to prevent Munich-based UsedSoft GmbH from selling computer software and licenses no longer used by the original buyer.
"Even if the license agreement prohibits a further transfer the rightholder can no longer oppose the resale of that copy," the court in Luxembourg said in a statement advising the German judges who will ultimately rule on the matter.
Oracle said the ruling ignored the value of innovation and intellectual property to Europe's economy. The Redwood City, California-based company said in an e-mailed statement that customers faced unnecessary risks by buying second-hand software licenses without knowing if the originals were purchased legally.
UsedSoft said the ruling also applied to computer programs sold by Microsoft Corp. and Adobe Systems Inc.
"This decision is a milestone for free trade in Europe," said Peter Schneider, the managing director of UsedSoft. "This is particularly good news for customers who can finally benefit from low software prices without restrictions."
The court judgment set limits on software resales, saying the original buyer must make their own copy unusable when he sells it on. Resellers also aren't authorized to divide a license for several users and to sell them separately, the court said in the statement.
The case is: C-128/11 Axel W. Bierbach (liquidator of UsedSoft GmbH) v Oracle International Corp.