Broadcom Lawsuit 2025, Fidelity Warns of “Massive Outages” as VMware Price War Explodes Into Legal Case
Major corporations including UnitedHealthcare Services, Fidelity Investments, AT&T, and Siemens face breach of contract lawsuits with Broadcom over VMware software licensing, with companies alleging the tech giant demands hundreds of millions more for software renewals while threatening service termination. Fidelity’s November 2025 lawsuit warns of massive outages affecting 50 million customers and $17.5 trillion in assets under management unless courts intervene, making this the most recent escalation in an expanding legal battle that began in August 2024.
Following Broadcom’s $61 billion VMware acquisition in November 2023, the company eliminated perpetual licenses and bundled hundreds of products into four subscription packages, triggering price increases reaching 1,050% for some customers like AT&T.
What Triggered the Broadcom Lawsuits?
Broadcom’s December 2023 announcement ending perpetual VMware licenses forced customers onto subscription-based bundles at drastically higher costs. Customers reported VMware license cost increases up to 500%, while AT&T faced demands for tens of millions more for unwanted software bundles.
UnitedHealthcare Services filed its April 2, 2025 lawsuit in Minnesota federal court after Broadcom threatened to terminate access to mission-critical CA mainframe software on April 18, 2025. The healthcare giant claims transitioning to alternative mainframe software would take years, leaving millions dependent on its systems vulnerable.
Fidelity’s November 3, 2025 lawsuit in Suffolk County Superior Court alleges Broadcom refused to honor renewal rights for VMware virtualization software Fidelity has used since 2005. Without this software, Fidelity warns customers cannot access accounts or execute trades, and employees lose access to internal systems.
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Multiple Broadcom Lawsuits: AT&T, United Healthcare, Siemens, Fidelity, and Netherlands Government
AT&T v. Broadcom (August-November 2024)
AT&T filed suit August 29, 2024 in New York State Supreme Court seeking injunctive relief after Broadcom refused to honor renewal rights for VMware support services expiring September 8, 2024. The telecom giant accused Broadcom of attempting to bully it into paying a “king’s ransom” for unwanted subscriptions.
Case Status: AT&T and Broadcom reached a settlement-in-principle in November 2024, with terms remaining confidential.
United Healthcare Services v. Broadcom (April 2025-Ongoing)
Case Number: 0:2025cv01189, U.S. District Court for the District of Minnesota
UnitedHealthcare filed its 54-page complaint on April 2, 2025, alleging breach of contract over CA mainframe software pricing. The company claims Broadcom threatened retaliation with even higher prices if UnitedHealthcare attempted to enforce contract rights through litigation.
Key Timeline:
- March 12, 2025: UnitedHealthcare CTO Sandeep Dadlani met with Broadcom CEO Hock Tan to discuss renewals
- March 14, 2025: UnitedHealthcare submitted renewal order
- March 20, 2025: UnitedHealthcare counsel notified Broadcom of contractual violations
- March 30, 2025: CA Software license scheduled to expire, extended to April 18, 2025 for negotiations
- April 2, 2025: Lawsuit filed
Current Status: Case remains active in Minnesota federal court with no preliminary injunction hearing scheduled yet.
VMware v. Siemens (March 2025-Ongoing)
VMware filed a copyright infringement complaint March 21, 2025 in U.S. District Court for the District of Delaware against Siemens AG and its U.S. affiliates. The lawsuit alleges Siemens listed thousands of copies of VMware products for which it never purchased licenses when requesting support renewal in September 2024.
VMware seeks a jury trial, demanding compensation for damages and profits attributable to the alleged infringement. In June 2025, VMware accused Siemens of impeding case progress and delaying discovery, while Siemens signaled intent to file a motion to dismiss.
Current Status: Discovery disputes ongoing as of mid-2025.
Netherlands Water Agency v. Broadcom (June 2025 Court Victory)
The Dutch Ministry of Infrastructure and Water Management’s executive arm RWS won a preliminary relief ruling June 27, 2025 at The Hague District Court. The judge ruled Broadcom acts in breach of its duty of care by failing to provide adequate exit support for systems managing vital national infrastructure.
Court Order: Broadcom must provide maintenance updates, bug fixes, and technical assistance for two years at €1.8 million annually, facing penalties of €250,000 per day up to €25 million maximum for non-compliance.
Fidelity Technology Group v. Broadcom (November 2025-Ongoing)
Fidelity Technology Group filed suit November 3, 2025 in Suffolk County Superior Court alleging breach of contract after Broadcom threatened to terminate VMware access. Fidelity argued 18 to 24 months are needed to migrate away from VMware virtualization software central to operations since 2005.
Latest Development: Broadcom agreed November 15, 2025 to extend Fidelity’s software access through January 21, 2026 pending judicial review.
Current Status: Preliminary hearing expected before January 21, 2026 deadline.
UK Retailer Tesco v. Broadcom (2025)
Tesco initiated legal action against Broadcom, VMware, and Computacenter alleging breaches of contract and competition law violations. The retailer seeks at least £100 million in damages, claiming Broadcom’s licensing changes violate contractual renewal rights for perpetual licenses purchased in 2021.
What Are the Legal Claims in the Broadcom Lawsuits?
Primary Legal Claims:
- Breach of Contract: Companies allege Broadcom refuses to honor existing agreements requiring renewal at specified pricing protections
- Copyright Infringement: VMware’s lawsuit against Siemens claims unlicensed software deployment exceeding purchased licenses
- Competition Law Violations: Tesco alleges Broadcom’s bundling practices and perpetual license termination violate antitrust regulations
- Duty of Care Breaches: Dutch court found Broadcom violated obligations to provide adequate exit support for critical infrastructure
Broadcom Lawsuit Jurisdiction and Courts
- New York State Supreme Court: AT&T case (settled)
- U.S. District Court for the District of Minnesota: UnitedHealthcare case (active)
- U.S. District Court for the District of Delaware: Siemens case (active)
- Suffolk County Superior Court, Massachusetts: Fidelity case (active)
- The Hague District Court, Netherlands: RWS water agency (ruled for plaintiff)
- UK Courts: Tesco case (active)
What Makes These Cases Unique?
UnitedHealthcare’s complaint reveals Broadcom CEO Hock Tan warned of retaliation through higher prices if customers pursued litigation. AT&T’s lawsuit highlighted national security risks, noting some servers support federal government agencies and the Office of the President.
The Siemens case represents a reversal where VMware sued its customer rather than defending against customer complaints, marking aggressive enforcement of compliance audits.
What Do These Lawsuits Mean for the Tech Industry?
Legal experts suggest the Dutch ruling could embolden similar litigation elsewhere, particularly in Europe where business protection laws are stronger. Forrester analyst Naveen Chhabra predicts few companies will pursue legal action given costs and time required.
Broadcom targets $8.5 billion in annual VMware earnings, making the €25 million maximum Dutch penalty minimal financial impact but creating precedent for forced migration support.
Cloud Infrastructure Services Providers in Europe (CISPE) filed a legal complaint with European regulators in July 2025, expanding regulatory scrutiny beyond individual customer disputes.
What Happens Next in the Broadcom Lawsuits?
Immediate Deadlines:
- January 21, 2026: Fidelity’s extended access deadline requiring preliminary injunction hearing
- Ongoing: UnitedHealthcare awaits preliminary injunction hearing scheduling
- Discovery Phase: Siemens case continues with motion to dismiss pending
Long-Term Implications:
Most customers are now aware of VMware cost implications through contract discussions or professional networking. Industry observers note over 52% of VMware customers have plans to switch to alternative virtualization solutions.
How Do These Cases Compare to Similar Lawsuits?
The Broadcom-VMware situation parallels other software industry disputes:
- Oracle licensing audits: Half of organizations reported at least one Microsoft audit in three years, with IBM, Oracle, and SAP also conducting frequent audits
- Subscription model shifts: Customers reported bills spiking by as much as 500% following Broadcom’s bundling changes
- Perpetual license discontinuation: Broadcom consolidated hundreds of VMware components into four subscription-only bundles
What Should Companies Know About Broadcom VMware Licensing?
Starting 2025, Broadcom requires customers to license a minimum 72 cores per order regardless of actual needs. Effective April 24, 2025, VMware operates a single download site requiring “download tokens” to access software binaries.
Compliance Risks: Over 80% of enterprises have material license compliance gaps that could lead to penalties. Most organizations report being audited by at least one major vendor in the last 2-3 years.
Frequently Asked Questions About the Broadcom Lawsuit
What is the Broadcom lawsuit about?
Multiple major corporations have filed separate lawsuits against Broadcom alleging breach of contract over VMware software licensing. Companies claim Broadcom demands hundreds of millions more for software renewals while threatening service termination. The lawsuits challenge Broadcom’s post-acquisition pricing changes and bundling practices.
What triggered the Broadcom lawsuits?
Broadcom’s November 2023 VMware acquisition led to elimination of perpetual licenses and mandatory subscription bundles. The company announced ending perpetual licenses in December 2023, less than a month after completing the $61 billion purchase. Customers facing renewal deadlines discovered their existing contracts would not be honored at agreed pricing.
What are the main legal claims in these cases?
The primary claims include breach of contract for refusing to honor renewal rights, copyright infringement for unlicensed software usage (in the Siemens case), and competition law violations for anti-competitive bundling practices. Tesco’s case specifically alleges Broadcom’s changes undermine contractual renewal rights.
What is the current status of the Broadcom lawsuits?
AT&T reached a confidential settlement with Broadcom in November 2024. Fidelity’s lawsuit filed November 3, 2025 has a January 21, 2026 hearing deadline. UnitedHealthcare’s April 2025 case remains active in Minnesota federal court. The Siemens case continues in discovery phase with a motion to dismiss expected.
How much are VMware price increases after the Broadcom acquisition?
AT&T alleged a 1,050% cost increase in its lawsuit. Other customers reported VMware license cost increases of up to 500%. Some organizations report increases of 600% to over 1,000% in VMware renewal costs.
Which court ruled in favor of customers against Broadcom?
The Hague District Court ruled June 27, 2025 in favor of the Netherlands water agency RWS. The court ordered Broadcom to provide two years of maintenance support at €1.8 million annually with daily penalties up to €25 million for non-compliance.
What companies have sued Broadcom over VMware?
Major companies filing lawsuits include: AT&T (settled November 2024), UnitedHealthcare Services (April 2025), Fidelity Technology Group (November 2025), Tesco (2025), and the Netherlands Ministry of Infrastructure. Additionally, Broadcom/VMware sued Siemens in March 2025 for alleged licensing violations.
What happens if companies don’t comply with new Broadcom pricing?
Broadcom threatens to terminate software access, which Fidelity claims would cause massive outages preventing customers from accessing accounts or executing trades. UnitedHealthcare alleges loss of access would create widespread consequences for millions relying on its operations. AT&T warned of potential widespread network outages affecting millions of customers worldwide.
Disclaimer: This information is for educational purposes only and does not constitute legal advice. Case details, legal claims, and outcomes may change. Review current case filings independently and contact an attorney for specific questions about this case.
Last Updated: November 18, 2025
About the Author
Sarah Klein, JD, is a licensed attorney and legal content strategist with over 12 years of experience across civil, criminal, family, and regulatory law. At All About Lawyer, she covers a wide range of legal topics — from high-profile lawsuits and courtroom stories to state traffic laws and everyday legal questions — all with a focus on accuracy, clarity, and public understanding.
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