Hacker News Reader

Hacker News

Comment by c-smile | Hacker News Reader

Full thread

c-smile

I have a question in regards of this.

If company A owns/purchased license for a product issued by company C.

The license clearly states:

"Licensee may not resell, rent, lease … the Source Code or any part of it … "

And now company A gets sold to company B.

What should happen in this case with the License? Whom the License belongs now? Shall it be revoked or what?

How to deal with such situations in practice?

View on HN

The contracts often say that. In practice, it's never used and vendors generally behave pretty reasonably. I work for a company that has made numerous acquisitions over the past few years. Sometimes it's not an acquisition and the other company has dissolved and the key people have accepted positions with us without transferring any assets or liabilities. I've never had a vendor forbid us from transferring licenses in either case. In fact, they usually reach out pretty quickly to update the name, contact info, etc. With some of the niche enterprise stuff, it's good business for them because the alternative probably means losing a customer. They'd rather let us keep using the software and likely pay for at least one annual renewal than try to hit us up for new licenses and we tell them to take a hike. Even huge vendors will do it though. Microsoft has let me transfer licenses before.

That kind of language in the contract is basically to prevent you from selling/transferring the license to some other unrelated company.

I asked the same thing a few years back. A lawyer friend of mine (not legal advice) said the company with the license does not need to transfer it since it's still used within the same customer: the company. The only difference is the definition of the company changed to include far more branches of employees, IP, and more.

Think about name changes for humans. You don't have to re-sign all of your contracts and potentially pay penalties for breaking and re-entering contracts in doing so. It is understood that you're still the same person but going by another identifier. Same here. Same company, another identifier.

Thanks, but the text of the license also states "All Source Code provided with Software... must be protected"

Yet particular license type is dependent on size of organization. A+B entity is clearly not the same as just entity B so something needs to be done in regards of this, no?

Reply on news.ycombinator.com