Tesco vs VMware: Dell weighs in on VMware contractual obligation

New legal documents filed relating to Tesco’s legal case against Broadcom/VMware and Computacenter point to a situation where Dell appears to be aligned with Tesco’s arguments for its rights to have continued access to VMware products and services.

The recent filing from Dell, as it defends itself against Computacenter, which is a defendant in the Tesco/Broadcom lawsuit, shows the technology firm’s contractual obligation as a VMware distributor to provide Tesco, through reseller Computacenter, with access to VMware software and support.

Tesco is suing Broadcom/VMware over what it sees as a contractual obligation by the owner of VMware products and support services to continue delivering perpetual software licences and product support. A legal filing by Tesco on 11 February 2026 shows that it is asking the court to prevent Broadcom/VMware from its continued efforts to deny the retailer access to the products and services it originally acquired through Computacenter in 2021, which laid out a provision to renew the contract in 2026, providing an additional four years of access to VMware and product support.

On 8 January 2026, Computacenter filed a claim against Dell relating to its inability to provide the VMware software it was contractually obliged to deliver to fulfil the contract with Tesco. Dell said it would sue VMware International for £10m if it is found to have broken its contractual obligation to Computacenter.

Broadcom claims that VMware and its subsidiaries had no obligation to Dell or its subsidiaries regarding the provision to renew VMware product offerings. It stated that, as per the 2023 distributor agreement with Dell, any renewal was subject to written acceptance by VMware.

However, the 3 February 2026 legal filing from Dell contends that even though its distributor agreement with VMware had ended at the time the Tesco licence and support agreement was up for renewal, the original five-year agreement laid out payment terms for nine years, to 2030.

The court filing from Dell shows that Dell Global (Singapore Branch) signed the VMware Authorized Distributor Partner Program Agreement (ADPPA) in June 2017. In the filing, Dell stated that the ADPPA, which is governed by New York law, “incorporates an implied covenant of good faith and fair dealing”.

Tesco signed up to a long-term contract for VMware products and support in 2021 for five years, ending at the start of 2026. The agreement, according to Dell’s latest court filing, shows that Tesco had the option to renew production-level support services for the software licensed on a perpetual basis upon expiry of its enterprise licence agreement (ELA) covering years six to nine.

The Dell legal filing shows that the cost Tesco pays increases based on a stated out-of-year renewal fee of £6.4m per year for years six and seven from the date of the original contract, plus an additional 10% in years eight (£3.6m) and nine (£3.9m).

According to the Dell filing, on 22 December 2023, VMware gave notice to terminate the ADPPA. Dell is claiming that despite this notice, VMware UK remains subject to Tesco’s licensing and support contract. Under the terms of its distributor contract with VMware, Dell said the ADPPA remains in place until outstanding orders are fulfilled. “The Final VMware quote constituted an outstanding order,” Dell stated in the legal filing.

The implications of this, at least according to the legal documents submitted to the court by Dell, are that Tesco was originally quoted for VMware product licensing and support for nine years, and as such, its renewal obligations are unaffected by the termination of the ADPPA.

In the filing, Dell said that on 3 October 2024, Tesco notified Computacenter that it wanted to renew Production Level Support Services and the Tanzu Basic and Tanzu Mission Control subscriptions. Computacenter conveyed Tesco’s request to Dell UK. Later in October, VMware advised Computacenter that it would not fulfil the renewal sought by Tesco. In the legal filing, Dell said this constitutes a breach and/or anticipatory breach of the renewal obligations. 

In a legal filing submitted on 11 February 2026, Tesco said: “VMware International owed to Tesco the obligation to supply the VMware Software and Support Services, via Dell and/or Computacenter.”

Broadcom and VMware have previously stated that the wording of the contract means they do not have to provide products and services that are no longer available. Broadcom argued that Tesco would not have the option to renew support services, and Computacenter would not be obliged to procure a renewal of the VMware software if the relevant software or services are no longer available, or the products have reached end of life.

Tesco is calling for VMware/Broadcom to be stopped from denying it access to the products and services VMware had agreed to supply.