Contract dispute with HPE costs Oracle $3bn

Lady Justice On The Old Bailey, LondonOracle has released a statement declaring it will appeal a jury decision to side with HPE in a long-running contract dispute worth $3 billion.

The dispute dates back to 2011 when Oracle decided to stop creating new versions of its database and other software for systems running Intel’s Itanium chip. The HP Enterprise claimed the decision violated the contractual terms between the organizations, a claim which the jury also believed. Oracle also claimed Intel had decided to stop supporting Itanium shifting focus to the x86 microprocessor, which the chip-maker has denied.

“Five years ago, Oracle made a software development announcement which accurately reflected the future of the Itanium microprocessor,” said Dorian Daley, General Counsel of Oracle. “Two trials have now demonstrated clearly that the Itanium chip was nearing end of life, HP knew it, and was actively hiding that fact from its customers.

“Oracle never believed it had a contract to continue to port our software to Itanium indefinitely and we do not believe so today; nevertheless, Oracle has been providing all its latest software for the Itanium systems since the original ruling while HP and Intel stopped developing systems years ago.”

Back in 2012, Santa Clara court’s Judge James Kleinberg confirmed to Oracle it would have to maintain its end of the contract for as long as HPE remained in the Itanium game. This decision was appealed by Oracle, which delayed the damages trial.

HPE has been seeking damages of $3 billion – $1.7 billion in lost sales before the case started, plus $1.3 billion in post-trial sales – which was awarded in full by the jury. Daley has unsurprisingly stated Oracle will appeal the decision, which could mean the sage will continue for some time.

Oracle has been having a tough time in the court room as of late, as it was seeking $8.8 billion in damages from Google over the unlicensed use of Java in a case which has dated back to 2010. The recent ruling was a victory for Google as the jury found Android does not infringe Oracle-owned copyrights because its re-implementation of 37 Java APIs is protected by ‘fair use’. Oracle again stated it would appeal the decision, though it has been a tough couple of months for Oracle’s legal team.