Broadcom, AT&T Reach Temporary VMware Support Deal

While their legal fight is far from over, Broadcom and AT&T have reached a temporary agreement that keeps VMware support in place at the telco a bit longer.

On Friday, Sept. 6, Broadcom and AT&T attorneys together told the New York Supreme Court that, to avoid a temporary restraining order, Broadcom will continue delivering VMware support services to AT&T until Oct. 9.

But with an Oct. 15 hearing around a preliminary injunction in the offing, more questions than answers seem to be arising.

AT&T Sues Broadcom Over Breach of Contract

AT&T sued Broadcom on Aug. 29, alleging that the chipmaker seeks to breach its VMware contracts with the telco in a move that puts first responders, other critical government services and national security at risk. 

AT&T says Broadcom is retroactively trying to force it to shift from perpetual to subscription software licensing, which would cost hundreds of millions of dollars. AT&T has refused to comply with Broadcom’s demands and tried to invoke an extension of its support contract, which it says Broadcom (then VMware) and AT&T agreed to in August 2022. 

Broadcom takes issue with AT&T’s stance and has been trying to pull its support of AT&T’s VMware environment. Had Broadcom followed through on its initial timing, its last day inside of AT&T would have been Sept. 8. 

Related:AT&T Sues Broadcom Over VMware Contracts ‘Bullying’

As matters now stand, Broadcom and AT&T’s lawyers, in a joint letter to Judge Jennifer G. Schecter, say the chipmaker will ensure VMware support services at AT&T through Oct. 9.

Preliminary Injunction Coming Against Broadcom?

Meanwhile, AT&T also has asked the court for a preliminary injunction against Broadcom. 

That would bar Broadcom from ending its support of AT&T’s VMware software before a judge makes any rulings. If Broadcom were to pull its support, the move would violate VMware’s contract with AT&T “and will cause AT&T, and potentially millions of its customers, irreparable harm,” AT&T attorney Jonathan D. Pressement of Baker & Hostetler LLP, told Schecter in a separate Sept. 6 request for that injunction. “The threat posed by [Broadcom’s] plan to terminate all support services for the software is imminent and cannot be overstated.”

More information on that front stands to come to light on or after Oct. 15. That’s the date Schecter has ordered Broadcom to appear in court via Microsoft Teams to argue its view about a preliminary injunction. What’s unclear is whether Broadcom will have pulled its VMware support at AT&T by then, since it has only committed to provide those services until Oct. 9.

Related:The Broadcom VMware Acquisition: A Complete Timeline

Some potential insight appears in that aforementioned joint letter. Both companies’ attorneys say Broadcom and AT&T will “work in good faith to negotiate any additional extensions of the date by which defendants intend to terminate support services as may be required to permit the court to render a decision on AT&T’s motion for a preliminary injunction prior to such termination. However, to the extent a decision on AT&T’s motion is not issued by Oct. 21, 2024, the parties agree to jointly approach the court for further guidance.”

More Broadcom and AT&T Legal Maneuvers

Meanwhile, Broadcom says it will meet the judge’s deadline of Sept. 20 for stating its opposition to AT&T’s lawsuit.

Finally, on Monday, AT&T filed motions asking the court for permission to redact some information from public filings and keep further documents confidential. Broadcom’s legal counsel expects to make the same request. 

Schecter already has agreed to seal some dockets and also set a Sept. 30 hearing around sealing more information. When it comes to some other arcane aspects of the legal process surrounding the confidentiality requests, Schecter notes that the court is “unpersuaded” and skeptical. As such, “compelling justifications” will be necessary.

“… [A] confidentiality provision is not good cause to seal,” Schecter wrote on Sept. 9.

Baker & Hostetler LLP is representing AT&T. Hueston Hennigan LLP is serving as Broadcom-VMware’s legal counsel.