Department store chain Target Australia has terminated its software licensing contract with retail software provider daVinci during the three-year agreement's final year.  

The retailer is challenging the effectiveness of daVinci's inventory and merchandise planning software and is seeking reimbursement of $2.8m for licences, hosting and professional services, iTnews has reported.  

According to a recent court ruling, the relationship between Target and daVinci has deteriorated during the agreement's final year, leading to Target refusing to pay the third annual software licence fee to daVinci. 

iTnews quoted Target's counsel: “Until this time, Target had regularly made the licensing and hosting payments and many further payments for specific work requested by Target.” 

DaVinci is pursuing a payment of $531,707 from Target.  

Target's counterclaim demands a refund of all expenses incurred with daVinci up to this point. 

The case is expected to go to trial in August 2025 unless a resolution is reached before then.  

The County Court of Victoria's Judge Anderson noted that after more than two years, Target deemed the provided services by daVinci as "entirely worthless," and had refused to pay when they were invoiced in June 2023. 

The retailer filed a purported notice of termination in September 2023. 

“The damages Target counterclaims and sets off in defence of daVinci’s claim in the proceeding, comprise every payment it had paid to daVinci over the previous two-and-a-half years in respect of their commercial arrangements,” the judge added.  

In a minor legal win for Target, the court ordered daVinci to post a $25,000 security potentially contributing towards legal costs.  

Attempts to reach Target Australia for comment have been unsuccessful. A statement from daVinci has also been sought.