Broadcom's VMware secured an initial advantage in its latest legal challenge with a customer looking to dump the vendor, after a magistrates' judge sided with the software giant’s efforts to stop a case being shipped to Germany.

Industrial giant Siemens had sought to have a case currently before a Delaware court moved to Europe, arguing that its Master Software License Agreement (MSLA) signed with VMware back in 2012 stipulated legal disputes should be resolved in Munich courts.

VMware’s efforts to stop the change of jurisdiction were boosted after Judge Laura Hatcher recommended denying Siemens’ request. In a 21-page report, Hatcher found that the forum selection clause in Siemens original MSLA with VMware used too narrow language.

Siemens had alleged that, since the initial agreement stated courts in Munich have exclusive jurisdiction over “any dispute arising out of this agreement,” that covered VMware’s allegations of copyright infringement because the whole dispute grew out of their contractual relationship.

The problem for Siemens, however, is that a key Third Circuit precedent they were leaning on (McGraw-Hill) referenced a clause covering “any dispute regarding this agreement” – meaning its entire argument leaned on two phrases it thought meant the same thing.

Hatcher, however, was unconvinced, finding Siemens failed to prove otherwise, arguing that the reference to “regarding” has “a broader connotation" than phrases like “arising under,” “arising out of,” or “arising in relation to.”

Essentially, Siemens’ entire argument was boiled down under a semantic microscope, one that ultimately favored VMware.

That doesn’t mean the Broadcom-owned brand is in the clear, though, as a magistrate judge’s Report and Recommendation (R&R) is merely a preliminary finding meant to advise a district judge.

The involved parties have a short period, usually around 14 days, to file written objections to argue the initial findings.

It wasn’t all VMware’s day, however. Hatcher also recommended dismissing Siemens AG, the German parent company, from the case entirely, finding VMware had failed to adequately establish personal jurisdiction over the Munich-headquartered conglomerate. The U.S.-based Siemens affiliates named in the suit remain as defendants.

Legal wrangling goes on

VMware filed suit against the American arm of the industrial giant last March, alleging that when it came time to negotiate new support contracts, Siemens was using considerably more VMware products than it actually had licenses for.

Siemens sought to challenge the claim, requesting it be transferred to Germany. But VMware rallied right back, contending that the dispute was not one of contractual concerns, but of copyright, arguing that the prior agreement did not cover statutory copyright claims – thereby making the U.S. District Court for the District of Delaware the appropriate venue.

The other potential reason why VMware may have sought to prevent the case from being shipped from the U.S. to Germany is that of forum shopping, where a party seeks to move the case to a specific court or jurisdiction with the goal of a more favorable judgment. A motivator for such a move may just be that under U.S. copyright law, VMware would be entitled to far greater potential damages and potentially stricter remedies than a simple breach of contract claim in German civil courts.

The Siemens dispute is one of a growing number VMware finds itself involved in following the licensing overhaul instigated by parent Broadcom.

Since the creation of its VMware Cloud Foundation suite (VCF), VMware’s core products have been bundled into one core platform, meaning customers are forced to pay for software products they don't even want to use in order to access the features they do.

Customers have reported that the overall cost for the revamped license has soared, with the likes of British supermarket giant Tesco among those taking to the courts to challenge the changes.

AT&T was among those to take on VMware, branding Broadcom a “bully” trying to force the carrier into “paying a king’s ransom for subscriptions [it] does not want or need.” The telecom giant settled its dispute a month later, but the dispute with Tesco is still ongoing.

One such case didn’t quite go the way VMware was hoping, however, as the Netherlands national water agency saw a local court back its efforts to get the software vendor to continue providing support to the Ministry of Infrastructure and Water Management, even as the agency looks to switch to an alternative provider.

For all the legal wrangling, Broadcom CEO Hock Tan still proudly proclaimed that more than 90% of VMware’s 10,000 largest customers have signed up for the vendor’s VCF platform.