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ARTICLE · 05 OCTOBER 2018

Potentially Unconscionable Warranty Precludes Licensor's Motion To Dismiss

The warranty is among the most essential terms of a software license, as the provision often concerns the functionality and capability of the software.

United StatesLitigation, Mediation & Arbitration

Richard Raysman is a partner and Elliot Magruder is an attorney in Holland & Knight's New York office

The warranty is among the most essential terms of a software license, as the provision often concerns the functionality and capability of the software. Many warranties are the subject of concerted negotiations, but often the parties revert to boilerplate. A licensor typically seeks to limit what it warrants, while a licensee seeks to establish that the licensor possesses good and marketable title in the software and that the software will function.

These priorities often conflict, and particularly when warranty provisions are quickly negotiated and formalized in brief and vague terms. On July 30, 2018, the United States District Court for the District of Minnesota issued its opinion in Prairie River Home Care, Inc. v. Procura, LLC, holding that the software licensee's claims for breach of contract and breach of warranty could survive a motion to dismiss, while

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