Called as a witness for Oracle, Catz reiterated an earlier point made by Oracle CEO Larry Ellison, saying that had SAP licensed the materials that its TomorrowNow subsidiary ultimately pilfered, it would have cost “billions.” She also reminded SAP’s legal team that her email on SAP/TomorrowNow as a competitive threat was written without knowing about TomorrowNow’s copyright infringement.

Worse, she dismissed SAP’s offer of $40 million in damages as laughable. “SAP paying us damages of $40 million would be a reward for their bad behavior. “It’s like taking someone’s $2,000 watch and hocking it for $20, and then offering to give us $20. It’s crazy. It completely undervalues the entire basis for our industry.”

A powerful jab, and one that’s making the rounds in media reports on the trial today.

PREVIOUSLY:

• Oracle Enlists Process Servers, Not PIs, to Find HP CEO
• Oracle-SAP Trial: Ellison Swaps Katana for Poison Darts
• Objection: Mr. Ellison Is Referring to the Defendant as “Choleric of Temper” Again
• Oracle Lands Early Shots in SAP Trial
• Your Honor, We Object to Mr. Ellison’s Repeated Use of the Term “Slimy Weasels”
• Oracle to HP CEO: Chicken!
• Oracle Vs. SAP: We Got a Right to Pick a Little Fight–Bonanza!
• SAP’s Tab in Oracle Case: $120 Million and Counting
• Gag Order Denied in Oracle, SAP Trial
• Ellison Taunts HP CEO a Second Time
• SAP to Ellison: Save the Drama for Your Mama
• Ellison to HP CEO: “Warrior, Come Out to Plaaeeay!
• SAP: Please Gag Oracle
• HP Scandal Sucks in New York Times Columnist Over Conflict of Interest
• Welch to HP Board: You Don’t Know Jack!
• Insiders Criticize Ellison For HP CEO Slam
• Was Apotheker HP’s First Choice of CEO?
• HP Names Ex-SAP Chief Apotheker as CEO

Sources in a position to know tell me that the PIs rumored to be searching for Apotheker are actually PSs–process servers, agents charged with delivering subpoenas to their intended recipient. And, as federal law dictates, their search extends no farther than 100 miles from the location of the trial, because if Apotheker is outside that 100-mile radius, they can’t serve him. And Oracle can’t compel him to testify. Which means it’s not really worth the company’s time or effort to hire Dog the Bounty Hunter to track him down in some Schwarzwald hideout.

As Oracle attorney David Boies said during a press conference after Monday’s proceedings, “Because of his role, we think it’s important for the jury to be able to see him live. But evidently, the embarrassment of avoiding trial is less than the embarrassment of testifying. We are trying to serve him. Still.”

PREVIOUSLY:

• Oracle-SAP Trial: Ellison Swaps Katana for Poison Darts
• Objection: Mr. Ellison Is Referring to the Defendant as “Choleric of Temper” Again
• Oracle Lands Early Shots in SAP Trial
• Your Honor, We Object to Mr. Ellison’s Repeated Use of the Term “Slimy Weasels”
• Oracle to HP CEO: Chicken!
• Oracle Vs. SAP: We Got a Right to Pick a Little Fight–Bonanza!
• SAP’s Tab in Oracle Case: $120 Million and Counting
• Gag Order Denied in Oracle, SAP Trial
• Ellison Taunts HP CEO a Second Time
• SAP to Ellison: Save the Drama for Your Mama
• Ellison to HP CEO: “Warrior, Come Out to Plaaeeay!
• SAP: Please Gag Oracle
• HP Scandal Sucks in New York Times Columnist Over Conflict of Interest
• Welch to HP Board: You Don’t Know Jack!
• Insiders Criticize Ellison For HP CEO Slam
• Was Apotheker HP’s First Choice of CEO?
• HP Names Ex-SAP Chief Apotheker as CEO

On the stand in an Oakland, Calif., courtroom today, Ellison was such a picture of moderation and restraint that you almost wondered if his handlers had shot him up before his appearance–like sedating a dog for air travel. As one SAP rep told me, Ellison “was anti-climatic given his vituperative statements of the last weeks.”

Which is true. But his testimony was still quite damning–to my ears anyway. For one thing, he said that Oracle could have charged SAP $4 billion to license the programs that its TomorrowNow subsidiary wrongfully downloaded. For another, he said Oracle would have had trouble paying its employees if it allowed its rivals unfettered access to the software and support libraries at issue in this case.

“I’m not sure we would go out of business but pretty close to going out of business,” Ellison said during questioning by attorney David Boies. “If they could get that software for nothing, we’d have a hard time paying 100,000 employees.”

If that was the case, then why didn’t Oracle make a bigger stink over SAP’s acquisition of TomorrowNow when it was first announced? SAP’s legal team was quick to pick up on this and hammered Ellison, claiming there’s “not a shred of documented evidence” demonstrating Oracle’s concerns. But they didn’t get much of anywhere with that because it turned out there is some.

“When SAP announced the TomorrowNow acquisition,” Ellison said, “I made a public statement….I thought they might cheat around the edges in terms of our copyrights…and I publicly warned them that while they have every right to support our software, they have to respect our intellectual property–[they] can’t just redistribute it without paying for it.”

And, indeed, Ellison did do this during the company’s 2005 analyst day. “SAP has every right to provide support for PeopleSoft applications as long as they don’t violate our intellectual and contractual property rights,” he said. “It might make it awkward for them. That’s our intellectual property, and they should be cautious.”

Driving those remarks was Ellison’s fear at the time that with TomorrowNow, SAP might do Oracle real harm. “I thought this was a major program with a huge potential to do severe damage to Oracle,” Ellison said today, adding that his vision of how SAP planned to go about it wasn’t quite how things played out. “It was a brilliant idea to take our customers, but to execute it properly they had to go out and hire hundreds, if not thousands, of engineers to maintain PeopleSoft and JD Edwards and Siebel. That was going to be expensive. I certainly didn’t think they would simply take our intellectual property and then resell it to their own customers. I never thought that could happen.”

SAP’s attorney, Tharan Lanier, challenged Ellison on these points as well, suggesting Oracle is exaggerating when it claims that TomorrowNow’s infringement jeopardized as much as 20 to 30 percent of Oracle’s customers from its acquisition of PeopleSoft and 10 percent of those from the later acquisition of Siebel Systems. And in the end, Ellison conceded that only about 350 customers were lost as a result of TomorrowNow’s infringement. But he also managed to again suggest that potential losses were far, far greater.

“I think taking our intellectual property is a two-edged sword,” he said. “For [SAP] it means they have access to all our engineering output. They have regulatory updates at the same moment we have them. They have new versions of our software at the same time we have them. They have bug fixes at the same time we have them. So they should be able to provide the same quality of support that we’re providing except that they’re doing it at a very low cost, while Oracle bears the cost of all that engineering.”

The other side of that sword is running an irrational risk by taking our software. That’s a risk I certainly would never, ever undertake.”

PREVIOUSLY:

• Objection: Mr. Ellison Is Referring to the Defendant as “Choleric of Temper” Again
• Oracle Lands Early Shots in SAP Trial
• Your Honor, We Object to Mr. Ellison’s Repeated Use of the Term “Slimy Weasels”
• Oracle to HP CEO: Chicken!
• Oracle Vs. SAP: We Got a Right to Pick a Little Fight–Bonanza!
• SAP’s Tab in Oracle Case: $120 Million and Counting
• Gag Order Denied in Oracle, SAP Trial
• Ellison Taunts HP CEO a Second Time
• SAP to Ellison: Save the Drama for Your Mama
• Ellison to HP CEO: “Warrior, Come Out to Plaaeeay!
• SAP: Please Gag Oracle
• HP Scandal Sucks in New York Times Columnist Over Conflict of Interest
• Welch to HP Board: You Don’t Know Jack!
• Insiders Criticize Ellison For HP CEO Slam
• Was Apotheker HP’s First Choice of CEO?
• HP Names Ex-SAP Chief Apotheker as CEO

[Image credit: Pre-Ellison Samurai image by Artem Mirolevioch]

Google today responded to Oracle’s (ORCL) claims that its Android OS infringes copyrights and patents related to Java, which Oracle acquired as part of its purchase of Sun Microsystems earlier this year. This morning, the search sovereign filed an answer to Oracle’s suit, denying all seven of its patent-infringement charges, and asking that the company’s copyright-infringement claim be dismissed because Google (GOOG) feels it is “legally deficient.”

And, interestingly, the answer calls Oracle out as a hypocrite–a company that pushed for a fully open Java platform when the OS was owned by Sun, only to blatantly ignore the open source community’s requests to fully open source it after its acquisition of Sun closed.

“It’s disappointing that after years of supporting open source, Oracle turned around to attack not just Android, but the entire open source Java community with vague software patent claims,” the company said in a statement. “Open platforms like Android are essential to innovation, and we will continue to support the open source community to make the mobile experience better for consumers and developers alike.”

Google’s prayer for relief makes that disappointment quite clear. In it, the company asks not only for a judgment dismissing Oracle’s complaint against it with prejudice, but also for a judgment in favor of Google on all of its counterclaims; a declaration that Google has not infringed, contributed to the infringement of, or induced others to infringe, either directly or indirectly, any valid and enforceable claims of the Patents-in-Suit; a declaration that the Patents-in-Suit are invalid; a declaration that Oracle’s claims are barred by the doctrines of laches, equitable estoppel, and/or waiver; a declaration that the Oracle’s claims are barred by the doctrine of unclean hands; a declaration that this case is exceptional and an award to Google of its reasonable costs and expenses of litigation, including attorneys’ fees and expert witness fees; and such other and further relief as this Court may deem just and proper.

Here are three of the more pointed graphs from the answer, followed by a copy of the document in its entirety.

7. Sun came under significant criticism from members of the open source community, including Oracle Corp., for its refusal to fully open source Java. For example, in August of 2006, the Apache Software Foundation (“ASF”), a not-for-profit corporation that provides organizational, legal, and financial support for open source software projects, attempted to obtain a TCK from Sun to verify Apache Harmony’s compatibility with Java. Although Sun eventually offered to open source the TCK for Java SE, Sun included field of use (“FOU”) restrictions that limited the circumstances under which Apache Harmony users could use the software that the ASF created, such as preventing the TCK from being executed on mobile devices. In April of 2007, the ASF wrote an open letter to Sun asking for either a TCK license without FOU restrictions, or an explanation as to why Sun was “protect[ing] portions of Sun’s commercial Java business at the expense of ASF’s open software” and violating “Sun’s public promise that any Sun-led specification [such as Java] would be fully implementable and distributable as open source/free software.” However, Sun continued to refuse the ASF’s requests.

8. Oracle Corp., as a member of the Executive Committee (“EC”) of the Java Community Process (“JCP”), the organization tasked with managing Java standards, voiced the same concerns regarding Sun’s refusal to fully open source the Java platform. Later that year, in December of 2007, during a JCP EC meeting, Oracle Corp. proposed that the JCP should provide “a new, simplified IPR [intellectual property rights] Policy that permits the broadest number of implementations.” At that same meeting, BEA Systems – which at the time was in negotiations that resulted in Oracle Corp. purchasing BEA – proposed a resolution that TCK licenses would be “offered without field of use restrictions . . . enabling the TCK to be used by organizations including Apache.” Oracle Corp. voted in favor of the resolution.

9. Just over a year later, in February of 2009, Oracle Corp. reiterated its position on the open-source community’s expectation of a fully open Java platform when it supported a motion that “TCK licenses must not be used to discriminate against or restrict compatible implementations of Java specifications by including field of use restrictions on the tested implementations or otherwise. Licenses containing such limitations do not meet the requirements of the JSPA, the agreement under which the JCP operates, and violate the expectations of the Java community that JCP specs can be openly implemented.”

UPDATE: Oracle has issued this statement on Google’s answer.

“In developing Android, Google chose to use Java code without obtaining a license. Additionally, it modified the technology so it is not compliant with Java’s central design principle to ‘write once and run anywhere.’ Google’s infringement and fragmentation of Java code not only damages Oracle, it clearly harms consumers, developers and device manufacturers.”

UPDATE: Engadget’s Nilay Patel has a good analysis of Google’s strategy, here — as well as some potential holes in it.

2010.10.04 – Google Answer and Counterclaims _filed_ –

To wit, Google’s announcement Monday of a number of concessions to the European Union, which seems a bit dubious of the whole thing. In a letter to several publisher associations in Europe, the company invited two non-U.S. representatives to join the board that will oversee the book rights registry that is to distribute royalties from digital book sales under terms proposed by the settlement. The company also promised to seek their permission before digitally publishing European works still protected by copyrights.

“Books that are commercially available in Europe will be treated as commercially available under the Settlement,” Google (GOOG) explained. “Such books can only be displayed to US users if expressly authorised by rights holders.”

Quite a concession, given Google’s plans to create a so-called “last library,” but clearly necessary with opposition to the deal abroad so pronounced. Already, Germany has filed an objection to it, saying the agreement would “irrevocably alter the landscape of international copyright law.” And now France is about to do the same.

“Google will have a monopoly digitalising European orphan works without permission,” Nicolas Georges, director for books and libraries at the French Culture Ministry, told Reuters. “Google has the power to determine which work will be in its database or not. For example, some works that are not commercial may be removed by Google.”

Seems Google’s effort to establish a de facto worldwide copyright regime isn’t going to be quite as easy as the company had hoped.

Without comment, the court refused to review a Court of Appeals ruling that rejected claims by film studios and television networks that the network DVR approach would infringe copyrights.

Cablevision first announced plans for the service in 2006, but it has been tied up in litigation–until now. Among the companies opposed to the concept were Time Warner (TWX), CBS (CBS) and Disney (DIS).

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