Oracle rolls the dice with rejection of $272 million jury award
Although Oracle's numerous legal actions in different areas are not unique in the modern business software industry, the extent to which the company's fortunes are linked to its successes and failures in the courtroom is unusual.
Instead of ending a long-standing and bitter court fight with German firm SAP over alleged theft of customer support documentation and code, Oracle has instead chosen to double down, rejecting a $272 million jury award and opting for an entirely new trial.
The case centers on accusations by Oracle that TomorrowNow - a business software support company that was later acquired by SAP - illegally accessed proprietary information on Oracle's products in order to provide support services. In the initial trial, the jury awarded Oracle $1.3 billion in damages, a record for an intellectual property infringement case - but that sum was cut to $272 million on an appeal by SAP, with the judge ruling that the initial figure was "grossly excessive."
The German company admitted malfeasance by TomorrowNow, opting instead to fight the outsized nature of the verdict. According to CFO World, Oracle asserted that the award should represent the licensing cost that SAP would have had to pay if legal licensing procedures had been followed.
However, Judge Phyllis Hamilton held that Oracle should only be compensated for actual harm done to it in the form of lost business, adding that there was not enough evidence presented to demonstrate that the company was entitled to the proceeds of such a "hypothetical" license.
Oracle said in its filing that it couldn't accept the ruling's provision that it would have to give up its right to further appeals in the case.
"Oracle has no choice but to elect a new trial, as accepting the remittitur would force Oracle to risk waiving its right to appeal the Court's decision on the motions for judgment as a matter of law and for a new trial," the company stated in official court documents.
The effect of the ongoing legal drama on the open source software market could be significant. Oracle's recent sales performance has been lackluster, leading to a stagnant stock price that has been tied more closely to its courtroom performance than earnings.
Combined with a business software sector increasingly interested in open source products for their technological innovation and lower total cost of ownership, Oracle's struggles could be a sign of a deeper malaise. While the company has moved quickly to bring its offerings in line with the rest of the industry on big data by implementing cloud and Hadoop capabilities in recent products, the proprietary, unified-stack model could prove increasingly unattractive to businesses eager to avoid vendor lock-in and high licensing costs.
Elsewhere on the legal front, however, the picture has been brighter for Oracle of late. According to a report from the Register, the company's lawsuit against Google for allegedly violating its Java patents recently received a boost when a three-judge panel ruled that an internal email detailing the search giant's decision-making process for implementing Java in Android and Chrome could be used as evidence.
A trial is currently scheduled to begin sometime around March 19, 2012, the U.K. tech news source added.
Oracle is seeking $1 billion in damages from Google, and the ruling could open the door to further emails - some of which may undermine Google's case more directly - being admitted into evidence, according to Bloomberg.





