Software License Dispute Lawyers

Software Licensing | Licensing Agreements | License Audits | Implied Licenses

Businesses today rely on software to provide effective service to their customers. Software license agreements ensure each user is properly authorized to use that software, and ensure that the software remains up to date and fit for their purposes.

Software licensing agreements take many different forms, from “click-wrap” contracts to comprehensive licensing and software-as-a-service (SaaS) agreements.

Implied Software License

Not all software licenses are made in writing, and a licensee may be found to hold an “implied license” to use software, based on a course of conduct or verbal discussions. Such licenses may not even be revocable if the licensee can show they have provided consideration to the licensor.

Obligation and Liabilities

Breach of Software Licensing Agreement by Provider
Software providers, failing to fulfill contractual the obligations of a license agreement, can be exposed to significant liability should their customers lose business, data, or confidential information due to such failures or security vulnerabilities in the software.

Breach of Software Licensing Agreement by Licensee
Breach of a licensing agreement by the licensee may result in lawsuits for breach of contract, copyright infringement, and early termination of the software licensing agreement.

It is important that all parties to a software licensing agreement take steps to ensure they are operating in compliance with their obligations, including:

  • Appropriate and efficient audit requirements
  • Clear understanding of how the number of users, accounts, and instances are determined and how fees are calculated
  • Internal and automated monitoring to ensure all access and use of the software is properly authorized
  • Suitable safeguards to ensure uptime, support, or update obligations are being maintained
  • Ensuring licensors hold ownership or the right to sublicense the software.

Enforcement of Software License Agreements

Where a breach of a software licensing agreement has occurred, it is important to seek prompt legal representation and advice to minimize legal liability.

For licensees, software failures can have consequential effects on their own customers and inventory, such that the software failures must be remedied promptly to preserve a licensee’s own contractual obligations and customer satisfaction.

For licensors, urgent assistance may be necessary to protect and enforce their intellectual property rights and prevent unauthorized use of their software.

Exclusions in Software Licensing Agreement

Contracts of Adhesion
Many software licensing agreements are contracts of adhesion, drafted by one party and offered on a “take or leave ” basis. Exclusion clauses may in these agreements be construed narrowly against the drafting party.

Negotiated Agreements
Parties may negotiate liability limitations or liability exclusions that may cap or eliminate liability for certain acts or kinds of losses. Whether certain losses are included under these limitations or exclusions is often a point of contention in any ensuing litigation.

Mediation and Arbitration of Disputes

In many cases, parties may not wish to treat any disagreement or shortfall through the courts, and may specifically contract for alternative dispute resolution mechanisms such as mediation or arbitration to resolve any or all potential disputes that may arise under the contract.

Why Choose Gilbertson Davis LLP

We strive to resolve our clients disputes early and effectively through the provision of quality legal services at reasonable rates. We are experienced litigators both in the courtroom and in arbitration. We have experience in representing licensors and licensees in litigation or alternative dispute resolution.

We are a firm which has more than 30 years of practice in Toronto. We are ethical, professional and practical.

Many software licensing agreements involve software providers or licensees who are located in different provinces or countries. We have strength and experience in advising foreign clients involved in litigation or arbitration in Ontario and across its borders.

Some of our lawyers have been admitted and practiced law in foreign jurisdictions (including England, Bermuda and New York), have both foreign and local legal education, including in the U.S. and U.K. and a number of our lawyers and law clerks speak languages including French, Japanese, Portuguese, Italian, Russian and Cantonese.

We are often consulted by those located in the United States, and in the past have been consulted by or retained in litigation by those (or matters located) in Alaska, California, Washington, Nebraska, Illinois, Missouri, Ohio, New York, New Jersey, Rhode Island, Massachusetts, North Carolina, Tennessee, Georgia, Louisiana, Florida and Texas. Internationally, we have also been involved in litigation or arbitration with clients (or matters) located in the Netherlands, Norway, Sweden, England, Denmark, Italy, Switzerland, Germany, Greece, Cyprus, Malta, Monaco, Guyana, Liberia, South Africa, Angola, The Bahamas, Bermuda, British Virgin Islands, Dominican Republic, Dubai, United Arab Emirates, Iran, Kuwait, India, Bangladesh, South Korea, Hong Kong, PRC and Australia.

Please contact Gilbertson Davis LLP to arrange an initial consultation.

Contact Us


Call: (416) 979-2020
Request Consultation





I agree the Terms of Use on the Contact page


Please note that while we appreciate your interest in Gilbertson Davis LLP, we are not able to offer a contingency retainer.

Related Practice Index