Bitter – for DIageo that’s the taste of negotiating with SAP (IT Toolbox Blogs)



I previously wrote on the challenges that many SAP customers have with the indirect usage concept and it should come as no surprise that recently the UK courts ruled in favour of SAP in a dispute with the British multinational alcoholic beverages company Diageo. 

 

 

The concept of indirect access is a thorny one and SAP considers this to have occurred with a  licensee when the licensee breaches own SAP contractual definition of  “appropriate use.”

 

While the concept of “indirect use” in the contractual language may be vague it seems the UK courts have now set the stage and this decision may carry some significant influence on other cases that may be brought to court.

 

Brian McKenna of the Computerweekly suggests that the judgement has raised consternation among SAP customers in the UK and Ireland User Group. This should come as no suprise and of course it is not the first case of this nature.

 

While the case of  SAP UK Ltd v Diageo Great Britain Ltd [2017] EWHC 189 (TCC) (16 February 2017) may be judged, the matter of what indirect usage licenses are worth and how the value of access will be assessed, is not yet over.  

 

Mrs Justice O’Farrell DBE in the High Court of Justice Queen’s Bench Division Technology and Construction Court did not pass a judgement on the amount that Diageo will have to pay SAP she simply found in favour of SAP, as a plaintiff at this time. This is also only a High Court judgement and it can and likely will be appealed. 

 

The original claim was to the tune of some $70M focused on 5800 Salesforce users of a custom solution developed for Diageo.  Interestingly, Diageo uses SAP’s own, SAP Exchange Infrastructure (“SAP PI”), to push and pull messages between the SAP ERP and the Salesforce system.  

 

An additional fee is paid by Diageo for the use of SAP PI based on the monthly volume of messages processed – this amount paid, unfortunately was judged as not satisfying as an alternative to the requirement that every user connecting to the system, directly or indirectly needs to be a named user.

 

It will be interesting to see what the final judgement will be in terms of the compensation to SAP, it will also be interesting to see what happens when this case is taken to appeal. It will also be interesting to see whether existing and in particular new SAP customers do with respect to their contract negotiations. Diageo’s contract – referenced in the court documents, dates back to 2004 with amendments.

 

 
Licensing
 
SAP

Source: SANS ISC SecNewsFeed @ February 21, 2017 at 06:09AM

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