SAP gets into licensing disputes with AB-InBev
The software giant SAP is suing AB-InBev for USD 600 million claiming it lost out in software licensing fees, media reported on 4 May 2017.
One week after a UK court had favoured SAP in a USD 70 million licensing dispute with drinks company Diageo, the software company took AB-InBev to arbitration in the US, this time seeking damages of over USD 600 million because AB-InBev allegedly “under-licensed”. That’s a funny term which means that an organisation does not have enough licenses to cover the software it has deployed.
The target in the first case was Diageo. The judge accepted SAP’s argument that even indirect access to its software required a license, but has not yet ruled on the amount due. SAP wants an additional GBP 54.5 million (around USD 70 million), which is equal to the amount Diageo already paid for the twelve years for which license fees are in dispute.
The stakes are far higher in the second case, involving AB-InBev, as SAP is seeking “damages potentially in excess of USD 600 million” for breaches of its software license agreement, according to a note in AB-InBev’s 2016 annual report, published 22 March 2017.
The sum is sizeable, considering that AB-InBev’s total spending on software in 2016 was around USD 140 million, the report says.
AB-InBev admitted that SAP started arbitration in New York on 21 February 2017 but would not comment further. Their reticence is understandable because software under-licensing, with its insinuations of software theft, can be a serious problem for listed companies.
Although AB-InBev cannot be pleased with SAP’s claims, they are probably glad that SAP took them to arbitration. Unlike proceedings in open courts, the award – and all documents – can be kept confidential. Nosy Parkers will never find out the sum for which both parties will eventually settle.
