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Old 02-29-2008, 12:31 PM
LMStone LMStone is online now
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Default NE Customers May Be More Exposed Than YPL Users

I just today took a fresh look at the Network Edition license to see if, as a lay person, I could find any protections from Microsoft wanting to turn off Zimbra after the acquisition.

What I found (again, I am not a lawyer...) leads me to conclude unfortunately that Microsoft could turn off all Network Edition customers the day Microsoft closes on the acquisition of Yahoo.

Would be nice if someone from Zimbra could opine here otherwise...

Here's the thought process:

First, the NE license can be found at http://files.zimbra.com/website/docs...network_la.pdf.

I was originally focused on Section 9. (Termination), and thought we would be in the clear. But, then I reread the whole license and came across the last sentence of Section 6. (Indemnification):

"In addition, in the event Zimbra determines that any Product may become subject to a third party claim of intellectual property infringement, Zimbra may, in its sole discretion and as Licensee’s sole remedy, modify or replace or terminate the license with respect to that Product, provided that if the license is terminated without a replacement, Zimbra will refund to Licensee the applicable pre-paid fees with respect thereto attributable to the remainder of the pre-paid period."

My lay interpretation of that sentence is that Microsoft would need only to make the threat of an IP claim against Zimbra code, not an actual claim, and that would be enough for Microsoft to terminate our NE license right then and there, say, on the afternoon Microsoft closes the deal to acquire Yahoo.

Once again, I am not a lawyer, but someone please help me to understand if I am missing something here that would give us NE license holders any better protection.

All the best,
Mark
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