AllThingsD » jury http://allthingsd.com Sat, 26 May 2012 02:18:50 +0000 en hourly 1 http://wordpress.org/?v=3.3.2 http://allthingsd.com/theme/images/logo-rss.jpg All Things Digital http://allthingsd.com/ 144 22 Oracle's Narrow Victory Is Really Google's Win in Java Trial http://allthingsd.com/20120508/oracles-narrow-victory-is-really-googles-win-in-java-trial/ http://allthingsd.com/20120508/oracles-narrow-victory-is-really-googles-win-in-java-trial/#comments Tue, 08 May 2012 13:40:52 +0000 Arik Hesseldahl http://allthingsd.com/?p=205186 The poet Robert Frost once observed that “… A jury consists of twelve persons chosen to decide who has the better lawyer.” How then to interpret the mixed-bag verdict delivered yesterday in the first phase of the lawsuit pitting software giant Oracle against the search engine concern Google, over the use of parts of Java to build the Android mobile operating system?

Asked to decide whether Google had infringed upon Oracle’s copyrights to certain parts of the Java programming language, the jury agreed that it had. But then, when asked to decide on four specific examples of that infringement, jurors could agree on only one: The rangeCheck method in TimSort.java and ComparableTimSort.java. Don’t ask me to explain exactly what it is, but it is being described widely as “nine lines of code.” And, unfortunately for Oracle, the damages it can collect are limited to somewhere in the neighborhood of $150,000 to $200,000, or less than pocket change for either company, not the $1 billion or more Oracle had said it wanted.

Jurors were also unable to decide if the portions of Java code that it copied could be protected by the long-established doctrine of Fair Use, under which certain infringements can be excused. Google lawyers pounced on this, and said they would move for a mistrial.

The conclusion is that Oracle proved at least part of its argument, but failed to prove the dramatic injury it said it had suffered. It also proved that Google knew that it needed a license to Java in order to use the portions of Java that it did use. The complication there was the fact that one flavor of Java is compatible with other flavors of Java: It still operates under the old “write once, run anywhere” principle that Sun Microsystems envisioned when it created Java. Oracle still wants Google to take out a commercial license that would require Google to maintain Java compatibility with other platforms.

Still undecided — and this is the big issue that has the eyes of the software industry watching this case closely — is whether Oracle can prevail on the issue of protecting software APIs using a copyright in the first place. Jurors were instructed to proceed under the assumption that this was a matter of settled law, when in fact it is not. Judge William Alsup will decide on this issue later, and it is unclear exactly how the jury verdict in the first phase of this case will affect his decision.

Had Oracle won a more ringing endorsement from the jury, that portion of the argument might seem to be stronger. It’s an important point that Google argued against, saying APIs shouldn’t be subject to copyright protection, because they’re more like tools and techniques that programmers use to build software. You can copyright a given program because it’s unique, but you can’t copyright the language it’s written in. The possibly strained analogy I came up with before is this: You can copyright a musical composition like Miles Davis’s “So What,” but you can’t copyright the form of music known as jazz.

Oracle argued at trial that copyright law offers the only proper protection for original expression in software, mainly because software advances are incremental, building upon previous advances and innovations. Laws governing trade secrets and patents don’t get the job done. Oracle lawyers contended that copyright law, while still imperfect, protects innovations and advances at a more granular level, but mainly against copying.

Also still ahead is the patent phase of the trial, where Oracle will assert that Google violated Java patents in building Android. After that, there will be a third phase, where the two parties will wrangle over damages. So far, it seems — unless Oracle prevails in the patent portion — that there won’t be much to wrangle over.

At least for now, it appears that Google has escaped the worst of Oracle’s accusations. That was the conclusion of shareholders of both companies. Google shares rose by more than 2 percent on the news of the verdict yesterday, closing at $607.55 a share. Oracle shares fell by more than 1 percent to close at $27.92 a share. The case isn’t over, and Google hasn’t exactly come out of it looking virtuous. But if the point of defending against a lawsuit is to escape paying huge monetary damages, Google won the day.

Embedded below is the filled-out jury questionnaire:

Verdict

]]> http://allthingsd.com/20120508/oracles-narrow-victory-is-really-googles-win-in-java-trial/feed/ 0 Jury Rules for Oracle in Java Trial http://allthingsd.com/20120507/jury-rules-for-oracle-in-java-trial/ http://allthingsd.com/20120507/jury-rules-for-oracle-in-java-trial/#comments Mon, 07 May 2012 18:28:07 +0000 Arik Hesseldahl http://allthingsd.com/?p=204675 The Associated Press just flashed the news that there is a verdict in the Oracle-Google trial.

As the AP has it, the jury has decided against Google on Oracle’s copyright claim, but has reached an impasse on some key questions. There’s obviously more to this story as it develops. I’ll be updating as soon as I know more.

Update: The jury sided in part with Oracle, ruling that the Android mobile operating system infringes on some Java copyrights. However, it was deadlocked over the question of whether that use constituted “fair use,” and was therefore protected. This impasse appears to be the basis for a mistrial motion that Google lawyers say they intend to file.

Oracle has not prevailed on every point and, in fact, it’s looking like a messy victory. The jury found code in two files to be infringing, and that some elements of Android application programming interfaces or APIs were similar to Oracle’s Java APIs.

Attorneys for Google told Judge William Alsup that they intend to file a motion for a mistrial because of the impasse over the “fair use” question. Alsup told both sides to be prepared to argue that motion, which will come later.

A few other things are coming up: Judge Alsup still has to rule on whether APIs can be copyrighted as a matter of law. Jurors were instructed to deliberate, assuming that they could be copyrighted.

There is a clear finding that Google has infringed on nine lines of code. This came in Question 3A, concerning something called RangeCheck in Java. They decided that Google hadn’t infringed on two other blocks of code. With the jury out of the room, Judge Alsup said that there is “zero finding of copyright liability” on anything other than the nine lines.

That’s good for Google, because Oracle’s own expert at trial said they’re not worth much. An Oracle attorney suggested that the company should receive a share of Google’s profits on top of regular damages. Judge Alsup rejected that as “bordering on the ridiculous.”

From Google:

“We appreciate the jury’s efforts, and know that fair use and infringement are two sides of the same coin. The core issue is whether the APIs here are copyrightable, and that’s for the court to decide. We expect to prevail on this issue and Oracle’s other claims.”

And here’s Oracle’s statement:

“Oracle, the nine million Java developers, and the entire Java community thank the jury for their verdict in this phase of the case. The overwhelming evidence demonstrated that Google knew it needed a license and that its unauthorized fork of Java in Android shattered Java’s central write once run anywhere principle. Every major commercial enterprise — except Google — has a license for Java and maintains compatibility to run across all computing platforms.”

For reference, I’ve embedded the questionnaire that the jurors were required to fill out:

Jury Questions

]]> http://allthingsd.com/20120507/jury-rules-for-oracle-in-java-trial/feed/ 0 Will the Oracle-Google Jury Decide Today? Maybe. Maybe Not. http://allthingsd.com/20120507/will-the-oracle-google-jury-decide-today-maybe-maybe-not/ http://allthingsd.com/20120507/will-the-oracle-google-jury-decide-today-maybe-maybe-not/#comments Mon, 07 May 2012 17:49:38 +0000 Arik Hesseldahl http://allthingsd.com/?p=204562 It has now officially been a week since the jury in the Oracle-Google trial over Java heard the final arguments and began their deliberations. They’re back today, and it’s entirely possible that we’ll get a final verdict in the first phase of the case devoted to copyright.

Judge William Alsup is starting to talk about opening arguments for phase two of the trial, which will focus on patents. A third phase, assuming Oracle prevails, will focus on determining damages.

There was a false alarm late Friday when CNET and Bloomberg News reported that a partial verdict had been reached, when in fact it hadn’t. This happened after it became relatively clear that jurors were stuck and unable to agree on all four questions they have been tasked with answering.

Jurors have been asked to decide if Google’s use of 37 sections of Java source code — which Oracle owns, having acquired Sun Microsystems in 2010 — constitutes copyright infringement; or if, as Google argues, the copied sections are so insignificant as to amount to “no big deal.”

Oracle sued Google in 2010, after closing the Sun deal. Google stands accused of using some parts of Java to create Android without having first obtained the relevant licenses — first from Sun, then from Oracle — that, among other things, required compatibility with other flavors of Java.

]]> http://allthingsd.com/20120507/will-the-oracle-google-jury-decide-today-maybe-maybe-not/feed/ 0 Jury in Oracle-Google Trial Over Java Appears Stuck http://allthingsd.com/20120504/jury-in-oracle-google-trial-over-java-appears-stuck/ http://allthingsd.com/20120504/jury-in-oracle-google-trial-over-java-appears-stuck/#comments Fri, 04 May 2012 13:20:02 +0000 Arik Hesseldahl http://allthingsd.com/?p=203715 Thursday ended without a verdict in the Oracle-Google trial over Java, but there were notes to the judge from jurors asking questions, suggesting that the jury might be deadlocked.

The Associated Press reported that a note to Judge William Alsup asked what would happen if jurors were unable to come to a conclusion, and indicated that some jurors are not budging from their positions.

Alsup called jurors into the courtroom for a talk, then sent them home so they could “start fresh” today. Bloomberg Businessweek reported that Alsup told lawyers that it’s possible the jury is deadlocked. If that’s what happens, Alsup said, the parties would move immediately into the second phase of the trial, which covers patents.

Jurors have been asked to decide if Google’s use of 37 sections of Oracle-owned Java source code constitutes a copyright infringement, or if, as Google has argued, the copied sections are so insignificant as to amount to “no big deal.”

Oracle sued Google in 2010, after acquiring Sun Microsystems and becoming the owner of the Java programming language. Google stands accused of using some parts of Java to create Android without having first obtained the relevant licenses — first from Sun, then from Oracle — that, among other things, required compatibility with other flavors of Java.

The jury has been deliberating since lawyers for Google and Oracle wound up their arguments on Monday.

(Image courtesy of Icanhascheezburger)

]]> http://allthingsd.com/20120504/jury-in-oracle-google-trial-over-java-appears-stuck/feed/ 0 Galleon Witness Testifies of "Super Confidential" Deal Tips http://allthingsd.com/20110314/galleon-witness-testifies-of-super-confidential-deal-tips/ http://allthingsd.com/20110314/galleon-witness-testifies-of-super-confidential-deal-tips/#comments Mon, 14 Mar 2011 22:22:43 +0000 Michael Rothfeld and Susan Pulliam http://voices.allthingsd.com/?p=37642 A government witness at the insider-trading trial of Galleon Group founder Raj Rajaratnam told the jury Monday how he leaked details of “super confidential” negotiations between two technology companies to the hedge-fund chief, who was shocked at the terms of the possible deal.

The potential acquisition of ATI Technologies Inc., a Canadian graphics company, by chip maker Advanced Micro Devices Inc. was so secret that the project was at first code-named “Supernova,” and then “Go Big,” said Anil Kumar, a former McKinsey & Co. consultant who advised AMD on the deal. In discussions, AMD was referred to as “Los Angeles” and ATI was called “San Antonio,” he said.

But for months before the deal was announced in July 2006, Mr. Kumar testified, he had been discussing AMD’s plans with Mr. Rajaratnam. Mr. Kumar has testified that Mr. Rajaratnam had been paying him $500,000 a year for inside information, which was reinvested in Galleon through an account in India under his housekeeper’s name.

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]]> http://allthingsd.com/20110314/galleon-witness-testifies-of-super-confidential-deal-tips/feed/ 0 Searching for Details Online, Lawyers Facebook the Jury http://allthingsd.com/20110222/searching-for-details-online-lawyers-facebook-the-jury/ http://allthingsd.com/20110222/searching-for-details-online-lawyers-facebook-the-jury/#comments Tue, 22 Feb 2011 12:30:47 +0000 Ana Campoy and Ashby Jones http://voices.allthingsd.com/?p=36618 Facebook is increasingly being used in courts to decide who is–and who isn’t–suitable to serve on a jury, the latest way in which the social-networking site is altering the U.S. court system.

Prosecution and defense lawyers are scouring the site for personal details about members of the jury pool that could signal which side they might sympathize with during a trial. They consider what potential jurors watch on television, their interests and hobbies, and how religious they are.

Josh Marquis, district attorney of Clatsop County in Oregon, did background searches on Facebook to help pick a jury for a penalty trial last summer to determine if a convicted murderer should get the death penalty. He was looking for clues on how potential jurors might feel about the defendant, a man who killed a couple as a teenager in 1988. The jury imposed the death penalty.

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]]> http://allthingsd.com/20110222/searching-for-details-online-lawyers-facebook-the-jury/feed/ 0 SAP Plans to Fight $1.3 Billion Judgment in Oracle Case http://allthingsd.com/20110203/sap-plans-to-fight-1-3-billion-judgment-in-oracle-case/ http://allthingsd.com/20110203/sap-plans-to-fight-1-3-billion-judgment-in-oracle-case/#comments Thu, 03 Feb 2011 23:03:30 +0000 Arik Hesseldahl http://newenterprise.allthingsd.com/?p=2799 A federal judge in Oakland, Calif., reaffirmed what a jury had already decided–that the German software company SAP owes Oracle $1.3 billion for the theft of Oracle’s intellectual property by SAP’s now defunct TomorrowNow unit. The order came down from Judge Phyllis J. Hamilton today.

SAP apparently has other plans. Having won in December a small victory over the amount of interest it will have to pay, today SAP said it plans to argue that it shouldn’t have to pay quite as much to Oracle.

In a statement, it called the judge’s order a “procedural matter,” and said it plans to make post-trial motions challenging the amount the jury awarded. If not successful, it may appeal, the company said. Its full statement is below.

“Today the Court entered judgment in the Oracle v. SAP/TomorrowNow litigation, which is a procedural matter that occurs after a jury verdict. As stated before, we have accepted liability for the actions of TomorrowNow and have been willing to fairly compensate Oracle, but we believe that the amount awarded by the jury is disproportionate and wrong. Once the judgment is entered, SAP is permitted to challenge the jury’s award by way of “post-trial motions,” which are made to the trial judge. SAP will file these motions in the coming weeks asking the Court to reduce the amount of damages awarded or to order a new trial. We look forward to the Court’s resolution of the issues we will raise in our post-trial motions. Depending on the outcome of the post-trial motion process, SAP may also consider an appeal.”

Oracle, on the other hand, was happy to take another victory lap. “We are very pleased that the court’s final judgment for $1.3 billion, plus the court-awarded interest and the $120 million SAP paid during trial to settle additional charges, confirms the jury’s verdict against SAP for its massive intentional copyright infringement,” Oracle said in an emailed statement.

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]]> http://allthingsd.com/20110203/sap-plans-to-fight-1-3-billion-judgment-in-oracle-case/feed/ 0 Court Undoes Microsoft Win in Patent Case http://allthingsd.com/20110104/court-undoes-microsoft-win-in-patent-case/ http://allthingsd.com/20110104/court-undoes-microsoft-win-in-patent-case/#comments Tue, 04 Jan 2011 22:37:24 +0000 Beth Callaghan http://voices.allthingsd.com/?p=34751 The U.S. Court of Appeals for the Federal Circuit ruled today to reinstate a jury decision from an April case that found Microsoft’s anti-piracy software installation system infringed a patent held by Uniloc Singapore Private Ltd. The judge in the original case had thrown out the jury’s finding. The court also ruled, though, that a new trial is required to determine how much Microsoft should pay, stating that the jury’s $388 million award to Uniloc was “fundamentally tainted.”

]]> http://allthingsd.com/20110104/court-undoes-microsoft-win-in-patent-case/feed/ 1 SAP Granted Lower APR Damages Award in Oracle Case http://allthingsd.com/20101229/sap-seeks-0-apr-damages-award-in-oracle-case/ http://allthingsd.com/20101229/sap-seeks-0-apr-damages-award-in-oracle-case/#comments Wed, 29 Dec 2010 12:35:01 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=54745
SAP would rather not pay Oracle interest on top of the $1.3 billlion in damages awarded the company last month. But it has to, now that a court has granted Oracle’s demand for prejudgment interest.

Late Tuesday a Federal judge ordered SAP to pay interest on the gargantuan sum Oracle won against it in a November copyright infringement trial. But it also agreed to calculate that interest using a different method from the one employed by Oracle. And in doing so it lopped about $195 million dollars off the prejudgment interest Oracle had originally sought.

So good news or, rather, significantly better bad news. Certainly, SAP was pleased to learn it’s not obligated to pile quite as much prejudgment interest atop Oracle’s award as it might have been.

“While we believe that Oracle should only be awarded damages, we appreciate that the Court agreed with SAP on the proper calculation of interest in this case which dramatically lowered the amount,” an SAP spokesman told me. “The interest the Court ordered, based on the statutorily-set interest rate of .3 percent and the accrual period of September 29, 2006 through December 23, 2010, is approximately $16.5 million, rather than the over 200 million Oracle was seeking.”

Of course, that doesn’t make Oracle’s damages award any less massive. But then SAP hopes to whittle that down as well. As the company said in its filing last week: “Defendants plan to challenge that verdict on a variety of grounds in their post-judgment motions, including that it is excessive and overcompensates Oracle.”

Oracle declined comment.

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]]> http://allthingsd.com/20101229/sap-seeks-0-apr-damages-award-in-oracle-case/feed/ 0 Oracle-SAP Verdict: SAP Owes Oracle $1.3 Billion http://allthingsd.com/20101123/oracle-sap-verdict/ http://allthingsd.com/20101123/oracle-sap-verdict/#comments Tue, 23 Nov 2010 22:54:44 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=53149 Billions or millions. That was the central question in the Oracle vs. SAP case and in the end, the jury determined its answer to be billions with “b.” For the theft of Oracle’s intellectual property by its now shuttered TomorrowNow division, SAP must pay Oracle $1.3 billion.

This in addition to the $120 million in attorneys’ fees SAP agreed to pay when the trial first began.

SAP, which believed that the damages amounted to about $28 million, had argued that Oracle was looking for an undeserved bonanza out of the jury, while Oracle contended the market value of licensing the IP was between $1.65 billion and $3 billion.

As Nucleus Research’s Rebecca Wettemann notes, the damage award is “a drop in the bucket” to Oracle, but a stern warning to the industry. Looking forward, she said, “You have to bet Oracle will be reminding customers they’re choosing between thought leaders and intellectual property thieves–and what that indicates more broadly about how SAP does business.”

In a statement issued after the verdict , SAP was contrite:

“We are, of course, disappointed by this verdict and will pursue all available options, including post-trial motions and appeal if necessary. This will unfortunately be a prolonged process and we continue to hope that the matter can be resolved appropriately without more years of litigation. The mark of a leading company is the way it handles its mistakes. As stated in court, we regret the actions of TN, we have accepted liability, and have been willing to fairly compensate Oracle. Throughout this matter, our customers, employees and partners have stood by us and, for that, we are grateful. Our focus now is looking forward, helping our customers be best run businesses, and extending our legacy of industry leadership well into the future. We thank the jury for its diligent service through this lengthy trial and the Court for its supervision of this complex case.”

On behalf of Oracle, President Safra Catz sounded as clinical as Jack Webb wrapping up an episode of “Dragnet.” “For more than three years, SAP stole thousands of copies of Oracle software and then resold that software and related services to Oracle’s own customers,” she said in a statement. “Right before the trial began, SAP admitted its guilt and liability; then the trial made it clear that SAP’s most senior executives were aware of the illegal activity from the very beginning. As a result, a United States Federal Court has ordered SAP to pay Oracle $1.3 billion. This is the largest amount ever awarded for software piracy.”

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

]]> http://allthingsd.com/20101123/oracle-sap-verdict/feed/ 0 QOTD: What Happened to "He Is Clearly a Very Important Witness in This Case"? http://allthingsd.com/20101123/qotd-343/ http://allthingsd.com/20101123/qotd-343/#comments Tue, 23 Nov 2010 15:35:23 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=53107

“I think it would have been helpful and important for the jury to hear from him. On the other hand, it wasn’t essential. We were able to put our case in anyway.”

– Oracle attorney David Boies changes his tune on the importance of HP CEO Léo Apotheker’s testimony in the company’s copyright infringement lawsuit against SAP

]]> http://allthingsd.com/20101123/qotd-343/feed/ 0 Oracle-SAP: Closing Statements Followed by Closing Insults http://allthingsd.com/20101123/oracle-sap-closing-statements-followed-by-closing-insults/ http://allthingsd.com/20101123/oracle-sap-closing-statements-followed-by-closing-insults/#comments Tue, 23 Nov 2010 09:00:14 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=53083 With closing arguments said and done, the Oracle-SAP case is nearly over, but the companies continue to trade sucker punches outside the courtroom. In dueling statements issued Monday night, Oracle branded SAP an IP plunderer and SAP upbraided Oracle for its impolitic behavior and what it seems to view as poor form. Below, both statements in their entirety.

ORACLE on SAP
“Oracle brought suit to stop the illegal conduct and hold SAP fully accountable for its actions. Four years ago we discovered massive and indiscriminate downloading of software and support materials from an Oracle support Web site.

SAP immediately and, for three and a half years, repeatedly denied wrongdoing and responsibility. But on the eve of trial SAP began a series of admissions to claims of copyright infringement, violations of state and federal computer fraud laws, unfair competition, breach of contract, interference and other claims that settled liability before the trial began. Trial evidence and testimony showed that the SAP Executive Board was fully aware of the illegal activity and still acquired TomorrowNow to unlawfully take Oracle support revenues and move Oracle customers to SAP products and to disrupt and discredit Oracle. SAP not only failed to take action to stop the behavior, but it expanded it for 18 months after Oracle filed suit.

The pre-trial admissions and testimony over the last few weeks have exposed SAP’s scheme to capitalize on the use of stolen intellectual property. While Oracle seeks damages to fairly compensate it for this massive theft, it is perhaps more important to expose the illegal conduct by a dominant player in the industry and to send a message that intellectual property rights must be respected.”

SAP on ORACLE
The time for testimony and sidewalk claims by plaintiff’s counsel are over. The actual testimony took place in court.

We are very proud of the SAP legal team and our counsel Jones Day for their work in presenting our defense. We believe we have presented a solid case for the reasonable and appropriate compensation for damages by the limited actions of TomorrowNow. This case is not about who knew what, did what or supervised what…those issues were handled by stipulations prior to trial. This case is only about the damages, and we trust now in the jury to examine the evidence and testimony and reach a fair and just conclusion.

SAP has a long history as a trusted partner and we believe our legacy will extend beyond this matter. Throughout this matter over these three years, our customers and partners have stood by us and for that we are grateful. The mark of a successful leading company is the way it handles it’s mistakes. As indicated in court, we regret the mistakes of TN, we apologize to Oracle, and we have sought to address these mistakes by compensating Oracle for the damages. All along, we have done the responsible thing by admitting to the mistakes, taking care of the customers, winding down the TN business, and accepting liability. We are confident we can put this matter behind us and continue our leadership of this industry.

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]]> http://allthingsd.com/20101123/oracle-sap-closing-statements-followed-by-closing-insults/feed/ 0 Oracle-SAP Case Closes With $1.67 Billion Difference of Opinion http://allthingsd.com/20101122/oracle-sap-case-closes-with-1-67-billion-difference-of-opinion/ http://allthingsd.com/20101122/oracle-sap-case-closes-with-1-67-billion-difference-of-opinion/#comments Mon, 22 Nov 2010 23:54:07 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=53070 Closing arguments in the Oracle vs. SAP trial went about as expected, with Oracle attorney David Boies urging the jury to drop the hammer on SAP by awarding $1.7 billion in damages for infringement of intellectual property, and SAP attorney Robert Mittelstaedt arguing that to do so would be asinine.

“The defendants have admitted that their infringement was massive and prolonged,” Boies said in his closing statement. “It is clear that SAP’s board and top executives expected it would be worth billions of dollars.” And just because SAP wasn’t able to generate that kind of value from Oracle’s pilfered IP, doesn’t mean it shouldn’t pay full fare for its infringement. “They took it and they have to pay for it regardless of whether they did well or didn’t do well using it.”

But SAP would rather not pay what it describes as a poorly caluclated “bonanza” award. “This case comes down to what is the best measure of compensation,” SAP attorney Robert Mittelstaedt argued. “Oracle’s [proposed damages] are based on guesswork,” while SAP’s are “based on reality.”

And evidently factoring “reality” into the equation cuts a hell of a lot of fat off the damages award at issue here. Because Mittelstaedt says SAP feels it owes Oracle just $28 million, which is, remarkably, even less than the $40.6 million its high-paid damages expert suggested.

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]]> http://allthingsd.com/20101122/oracle-sap-case-closes-with-1-67-billion-difference-of-opinion/feed/ 0 LOLCatz: Safra on The Stand Again in Oracle-SAP Trial http://allthingsd.com/20101120/lolcatz-safra-on-the-stand-again-in-oracle-sap-trial/ http://allthingsd.com/20101120/lolcatz-safra-on-the-stand-again-in-oracle-sap-trial/#comments Sat, 20 Nov 2010 10:00:48 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=52879
Testimony in the Oracle vs SAP trial wrapped up on Friday with a second appearance by Oracle co-President Safra, who said SAP should pay at least $1.6 billion in damages for the copyright infringement’s of its TomorrowNow subsidiary and chided the company for its offer of $40 million.

“[Their offer] doesn’t value our intellectual property at all,” she said, adding that TomorrowNow’s infringement encompassed more than just support documentation. “Yes, there were documents and help guides and things like that, but there was also the software itself–probably millions of lines of code, which is what the products really are….And we spend billions a year on R&D. This is a business where intellectual property is worth billions.”

Greg Lanier, a Jones Day attorney representing SAP, pressed her on that point insisting that Oracle isn’t owed such a large damages award because the value that the company lost to TomorrowKnow’s infringement is that “Oracle doesn’t get the chance to sell that software to someone else.”

But Catz wasn’t having any of it.

“You know, if Warner Brothers had a little subsidiary that copied Disney’s entire library and started selling it for $2 a copy, and they got caught and then offered to give Disney back half of what they made, is Disney’s library only worth $50?” she asked. “I mean, really. It’s valuable. The fact that it was copied doesn’t change that it’s valuable.”

Lanier quickly dismissed Catz’s point as a “colorful analogy,” reminding her that there are only 358 lost customers at issue in this case. Hard to imagine that such a “colorful analogy” in an otherwise tedious enterprise software case didn’t resonate with the jury, though.

Closing arguments in the case begin on Monday, with jury deliberations to follow.

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]]> http://allthingsd.com/20101120/lolcatz-safra-on-the-stand-again-in-oracle-sap-trial/feed/ 0 Oracle Rests SAP Case, Slams HP CEO http://allthingsd.com/20101119/no-hp-ceo-testimony-in-oracle-sap-case/ http://allthingsd.com/20101119/no-hp-ceo-testimony-in-oracle-sap-case/#comments Fri, 19 Nov 2010 19:05:54 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=52955 Just a day or so left now before the jury in the Oracle-SAP trial begins its deliberations. Oracle called its last rebuttal witness early Friday and closing arguments will soon follow. In the end, Oracle opted not to show former SAP chief Léo Apotheker’s videotaped deposition following the advice of lead attorney David Boies, who last week suggested leaving the Hewlett-Packard CEO’s role in all this to jurors’ imaginations might be a better move strategically than showing them Apotheker’s now very dated testimony.

Indeed, speaking to reporters in the courtroom hallway this morning, Boies said that the evidence Oracle presented during the trial proved that Apotheker had knowledge of the copyright infringement scheme at issue in the case. “The testimony and evidence prove that Mr. Apotheker oversaw the copyright infringement scheme,” Boies said. “We did not show the 2 year old video deposition because it was taken before SAP stipulated to liability.”

Of course if Apotheker was as pivotal a figure as Boies maintains, one would think that there would at least be some content in his video deposition worth showing the jury. Certainly, that’s the view of SAP, which continues to maintain that Oracle’s repeated shots at Apotheker are more about the PR trial being conducted outside the courtroom than anything else.

“Today’s proceedings focused on the damages, and we remain confident that we have demonstrated a clear case for fair compensation to Oracle for the limited operations of TomorrowNow,” an SAP spokesperson said in a statement. “We trust now in the jury to bring this matter to an appropriate conclusion.”

HP has not yet commented on Boies’s remarks. The company reports earnings next week, and Oracle would obviously not be unhappy if any of this legal unpleasantness happened to lodge in investors’ minds.

UPDATE: Here’s HP’s official comment: “Oracle’s current stance is clear proof that they have been trying to harass Léo and interfere with his work at HP. As HP has said repeatedly, Oracle had ample opportunity to question Léo in the two years after he gave a full-day deposition. Léo was never asked to give an additional deposition. As HP and SAP have noted, Oracle chose not to include Leo as a live trial witness until after he was named CEO of HP. Léo had a limited role in the matter.”

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]]> http://allthingsd.com/20101119/no-hp-ceo-testimony-in-oracle-sap-case/feed/ 0 Plattner and White No-Shows at Oracle-SAP Trial http://allthingsd.com/20101118/sap-orcl/ http://allthingsd.com/20101118/sap-orcl/#comments Thu, 18 Nov 2010 11:50:33 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=52818 Oracle’s long-running legal battle with SAP and its now-shuttered TomorrowNow subsidiary is heading toward its climax. SAP is expected to rest its case Thursday, after which Oracle will call rebuttal witnesses, among them one of its strongest to date–President Safra Catz, who last week described SAP’s offer of $40 million in damages as “a reward for their bad behavior.” Presumably, Catz will have a bit more to say on that matter, now that SAP’s high-priced damages expert has outlined the calculation that got him to that figure.

Then it’s on to closing arguments, now scheduled for Monday, and finally deliberation. Odd to think that the case has reached this point with so few SAP board members actually testifying live in court. Looking over the final witness list for the trial reveals a number of noteworthy no-shows (beyond Hewlett-Packard CEO Léo Apotheker): Former SAP CEO Henning Kagermann, COO and board member Gerhard Oswald, co-founder and board chairman Hasso Plattner, and, most interestingly, CFO Mark White, SAP’s designated corporate representative for the trial and the guy tapped by its board to clean up the TomorrowNow mess.

Why didn’t SAP put them on the stand? Perhaps it’s because Werner Brandt and SAP co-Chief Executive Officer Bill McDermott, the only board members to take the stand, fared so poorly there.

Or perhaps it’s simply because of the way the trial has played out. “We’ve said from the start that our focus is on damages, that we are interested in resolution of this dispute and determining a reasonable number for damages, and putting the matter behind us,” an SAP spokesperson told me. “The witnesses we call support that focus. Please keep in mind that there were 73 names on the witness list when it was submitted. Since that list was submitted, the scope of the trial has been narrowed considerably and the length of the trial has been shortened.”

UPDATE: I’m told Kagermann was prepared to testify live, but did not due to time constraints. His video deposition was played instead.

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]]> http://allthingsd.com/20101118/sap-orcl/feed/ 0 Damages Expert to SAP: You Owe Me $14 Million and Oracle Four Times That http://allthingsd.com/20101117/damages-expert-to-sap-you-owe-me-14-million-and-oracle-four-times-that/ http://allthingsd.com/20101117/damages-expert-to-sap-you-owe-me-14-million-and-oracle-four-times-that/#comments Wed, 17 Nov 2010 11:09:36 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=52754 Oracle CEO Larry Ellison says SAP owes it $4 billion in damages for infringing its IP. Paul Meyer, its damages expert, puts that sum at about $1.7 billion.

But SAP damages expert Stephen Clarke argues it shouldn’t be more than $40.6 million.

Which is ironic considering SAP paid Clarke’s firm $14 million in fees to determine how much the company owed Oracle for infringing its IP. That’s more than 25 percent of the sum Clarke ultimately settled on (and $10 million more than the fees Oracle’s expert collected for his testimony).

But, according to Clarke, calculating damages accurately requires a certain detached objectivity and evidently it comes at a price. “There’s no anger or punishment allowed,” Clarke said Tuesday. “What happened as a result of that infringement is what matters. The only way to do that is focus on the actual number of contracts at issue here.”

And that number is just 358, well shy of the “thousands” of contracts SAP hoped to win away from Oracle.

Too bad there’s no dollar value on SAP co-CEO Bill McDermott’s apology to Oracle yesterday.

Oracle’s cross-examination of Clarke is expected to continue into Thursday, after which SAP will likely show a bit of testimonial footage and rest its case. Presumably that will be followed by some rebuttal witnesses from Oracle on Friday and closing arguments sometime the following week.

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]]> http://allthingsd.com/20101117/damages-expert-to-sap-you-owe-me-14-million-and-oracle-four-times-that/feed/ 0 Oracle, SAP and the Apotheker Sideshow http://allthingsd.com/20101116/oracle-sap-tk/ http://allthingsd.com/20101116/oracle-sap-tk/#comments Tue, 16 Nov 2010 11:00:01 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=52700

Why is Oracle so intent on putting former SAP CEO and new HP chief Léo Apotheker on the stand in the trial that will determine damages in Oracle’s long-running IP battle with its German rival?

SAP insists it’s to create a “PR sideshow”–which is true to an extent. But sometimes there’s more to a sideshow than meets the eye. Which is not to say that some nefarious scheme lies at the heart of all this, just that there is a lot of subtext to make sense of in this case. And it’s being written from two very different views of how damages should be calculated and how important Apotheker is as a variable in that calculation.

SAP’s view is that now that it has stipulated to liability, damages should be determined according to the actual number of contracts won by TomorrowNow and their value–not according to the number of contracts it hoped to win.

Oracle’s view is that damages should be determined by value of the intellectual property stolen from it and SAP’s ambitions for it. And while SAP’s stipulation to liability prevents Oracle from introducing evidence on liability, it leaves it free to introduce evidence for “context” on damages.

And that’s where Apotheker comes in.

According to evidence presented in the case, Apotheker chaired the launch of the Safe Passage program, of which the TomorrowNow acquisition was one part. And in his depositions, former SAP board member Shai Agassi clearly identified Apotheker as having some responsibility for TomorrowNow post acquisition, along with Gerd Oswald.

“I was the guy who led the the evaluation [of TomorrowNow] with Werner Brandt, who managed the acquisition teams at the time,” Agassi said. “The day of the acquisition, it was basically moved to Gerd Oswald, and the sales effort was moved over to Apotheker. So Safe Passage was managed by Apotheker and Oswald.”

Add to this the fact that Apotheker reported on TomorrowNow and the Safe Passage program in SAP earnings calls and was the only senior SAP exec quoted in a company release touting the program’s success, and it seems reasonable to expect that he might be able to provide some of the “context” Oracle is looking for (click document below to enlarge). One could argue that his expectations and forecasts for the program’s success speak directly to Oracle’s damages.

Or one could argue, as SAP and HP do, that his involvement was incidental and that he had no responsibility for TomorrowNow’s day-to-day operations and hence no knowledge of its transgressions.

But unless he testifies under oath, we’ll never know who’s right. And with Apotheker quietly going about his business at an undisclosed location, it’s looking like that’s how things will end up.

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]]> http://allthingsd.com/20101116/oracle-sap-tk/feed/ 0 Better Late: SAP Co-CEO Apologizes for Oracle IP Theft http://allthingsd.com/20101115/sap-co-ceo-apologizes-for-oracle-ip-theft/ http://allthingsd.com/20101115/sap-co-ceo-apologizes-for-oracle-ip-theft/#comments Mon, 15 Nov 2010 18:55:46 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=52643 What an uncomfortable moment this must have been for SAP co-Chief Executive Officer Bill McDermott. Under cross-examination by Oracle attorney David Boies in the trial to determine damages for the theft of Oracle IP by SAP subsidiary TomorrowNow, McDermott rolled over and offered up something that we’d not yet seen since this case began: An apology.

“Has SAP ever apologized?” Boies asked. “Would you like to do so now?”

McDermott’s reply, “I am sorry to Oracle.”

As I said, an uncomfortable moment–and evidently one of many. Boies subsequently asked McDermott if SAP had ever disciplined anyone at TomorrowNow for its misdeeds. McDermott said it hadn’t. “We were focused on a resolution with Oracle,” he said. “It’s a matter of priorities.” To which Boies replied, “I don’t mean any disrespect, but what is taking so long?”

To be fair, McDermott did offer some testimony supportive of SAP, noting that TomorrowNow didn’t generate a lot of software sales. “Not only was it not a big driver of software sales, it wasn’t a very successful [concept],” he said.

Maybe that’s why it took so many years for SAP to apologize.

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[Image credit: Someecards]

]]> http://allthingsd.com/20101115/sap-co-ceo-apologizes-for-oracle-ip-theft/feed/ 0 SAP Co-CEO Expected to Testify in Oracle Trial Today http://allthingsd.com/20101115/sap-co-ceo-expected-to-testify-in-oracle-trial-today/ http://allthingsd.com/20101115/sap-co-ceo-expected-to-testify-in-oracle-trial-today/#comments Mon, 15 Nov 2010 11:01:12 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=52572 Oracle may not get former SAP CEO Léo Apotheker on the stand in its trial against its Teutonic archrival, but it will get a shot at its current executive leadership. SAP co-CEO Bill McDermott is expected to testify as a witness for the defense today, if Oracle concludes its case, as the company’s legal team indicated last Friday.

SAP tapped McDermott as co-CEO earlier this year, but he’s been on the company’s executive board since 2008 and was serving as CEO of SAP America when SAP acquired TomorrowNow. Ironically, one of his first acts as co-CEO was to scrap an internal program examining SAP’s corporate values.

“Companies that are too internally focused are sick,” McDermott said at the time. “There’s nothing healthy about being obsessed with your own internal nonsense. If there was a project that built bureaucracy into the company or required people to think about our internal stuff, we’ve killed those projects.”

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]]> http://allthingsd.com/20101115/sap-co-ceo-expected-to-testify-in-oracle-trial-today/feed/ 0 HP to Oracle: Leave Léo Alone! http://allthingsd.com/20101113/hp-to-oracle-leave-leo-alone/ http://allthingsd.com/20101113/hp-to-oracle-leave-leo-alone/#comments Sat, 13 Nov 2010 09:00:45 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=52550 Oracle attorney David Boies’s call for Hewlett-Packard CEO Léo Apotheker to testify in its trial against SAP drew a quick response from HP, which continues to dismiss Oracle’s efforts to put him on the stand as harassment and nothing more.

“As HP has said repeatedly, Oracle had ample opportunity to question Léo in the two years after he gave a full-day deposition,” a spokesperson told me Friday evening. “Léo was never asked to give an additional deposition. As HP and SAP have noted, Oracle chose not to include Léo as a live trial witness until after he was named CEO of HP. Léo had a limited role in the matter and Oracle’s current stance is clear proof that they have been trying to harass Léo and interfere with his work at HP.”

Point meet counterpoint. That said, Oracle likely would have been most interested in deposing Apotherker a second time after SAP’s stipulation to liability for contributory infringement. And that didn’t occur until October 29, 2010.

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]]> http://allthingsd.com/20101113/hp-to-oracle-leave-leo-alone/feed/ 0 Oracle Still Hoping to Snag HP's Apotheker for SAP Trial http://allthingsd.com/20101112/with-no-apotheker-at-sap-trial-oracle-lawyers-may-choose-insinuation-over-deposition/ http://allthingsd.com/20101112/with-no-apotheker-at-sap-trial-oracle-lawyers-may-choose-insinuation-over-deposition/#comments Fri, 12 Nov 2010 23:10:42 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=52498 Hewlett-Packard describes Oracle’s efforts to subpoena CEO Léo Apotheker to testify in its trial against archrival SAP as “an effort to harass” him and “interfere with his duties and responsibilities.” But to Oracle, Apotheker is a central player and one it desperately wants to put on the stand. So much so, that Oracle attorney David Boies said today it may rest its case without showing Apotheker’s videotaped deposition in order to give itself more time to subpoena him to testify in person at the trial.

In a statement this afternoon, Boies reiterated the importance to Oracle of getting Apotheker in front of the jury, an effort thwarted so far because he has stayed out of range of a subpoena.

“[Former SAP director] Shai Agassi identified Leo Apotheker as being responsible for Safe Passage, with TomorrowNow as its cornerstone,” Boies said. “Werner Brandt [SAP director and CFO] did the same and testified that Mr. Apotheker was a member of the SAP AG Executive Board that fully supported the acquisition of TomorrowNow. He is clearly a very important witness in this case, especially now.

“When he testified at his deposition more than two years ago, it was before SAP and its wholly owned subsidiary TomorrowNow admitted infringing Oracle’s intellectual property through massive downloading and copying of PeopleSoft, JD Edwards and Siebel software. We think it is very important that Mr. Apotheker testify now, as a live witness in court, to explain his and SAP’s conduct.”

And if Apotheker still can’t be found? What then?

“Maybe we’ll just let the jury know that they’ve hidden him,” Boies said earlier. “I think it may be better for the jury to know that, here’s this guy who was at the center of all this [and we can't find him].”

In other words, jurors’ imaginations might be more powerful than the actual contents of Apotheker’s now very dated deposition. Better to tell them that the exec has been sequestered, and allow them to conclude that his testimony must be very damaging.

Of course, the flip side of this is that Apotheker and his deposition are inconsequential to the case and Oracle’s main goal in pursuing him has been to create a media circus around him to embarrass HP–which is what HP and SAP have been saying all along. And indeed, SAP repeated it again today in response to Boies’s comments. Said a spokesman, “Oracle’s heightened interest in Mr. Apotheker as a live witness came only after his appointment as HP’s CEO, a PR sideshow that has little to do with the real issues of this case–the actual damages from the limited operations of TomorrowNow.”

UPDATE: Reached for comment on Boies’ statement, HP maintained that Oracle’s efforts to put Apotheker on the stand are harassment and nothing more.

“As HP has said repeatedly, Oracle had ample opportunity to question Léo in the two years after he gave a full-day deposition,” a spokesperson told me. “Léo was never asked to give an additional deposition. As HP and SAP have noted, Oracle chose not to include Léo as a live trial witness until after he was named CEO of HP. Léo had a limited role in the matter and Oracle’s current stance is clear proof that they have been trying to harass Léo and interfere with his work at HP.”

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]]> http://allthingsd.com/20101112/with-no-apotheker-at-sap-trial-oracle-lawyers-may-choose-insinuation-over-deposition/feed/ 0 HP CEO to Oracle: Here's Looking at You, Kid–Suntory Time! http://allthingsd.com/20101110/hp-ceo-to-oracle-heres-looking-at-you-kid-suntory-time/ http://allthingsd.com/20101110/hp-ceo-to-oracle-heres-looking-at-you-kid-suntory-time/#comments Wed, 10 Nov 2010 20:37:11 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=52306 The process servers Oracle’s hired to track down former SAP Chief Léo Apotheker can take a few days off. Apotheker, who’s just begun his new gig as CEO of Hewlett-Packard, is far beyond their 100-mile reach.

He’s in Japan. Or at least he was a few days ago, when he gave an interview to Nikkei BP while in Tokyo. Of course that doesn’t mean he’s still there now–unless he’s shooting whisky ads on the side or has struck up an unlikely friendship with a neglected newlywed.

HP continues to refuse to divulge his location and, to be fair, that’s company policy and were you to put the same question to Oracle about one of its execs you’d likely get a similar answer. Said an HP spokesperson, “We don’t discuss the schedules or specific whereabouts of our executives.”

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]]> http://allthingsd.com/20101110/hp-ceo-to-oracle-heres-looking-at-you-kid-suntory-time/feed/ 0 Ellison to Self: Damn, Damn. I Knew I Should Have Said $4.5 Billion http://allthingsd.com/20101110/ellison-to-self-damn-damn-i-knew-i-should-have-said-4-5-billion/ http://allthingsd.com/20101110/ellison-to-self-damn-damn-i-knew-i-should-have-said-4-5-billion/#comments Wed, 10 Nov 2010 19:25:01 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=52292 Whatever damages Oracle is awarded in its suit against SAP, they’ll be $500 million lighter, thanks to an order by the judge presiding over the case. Judge Phyllis Hamilton has prevented Oracle from including in its damages estimates any potential lost profits from products it might have sold to customers it lost because of the SAP-TomorrowNow debacle.

So when Oracle’s damage expert, Paul Meyer, offered his estimate of what SAP should pay Oracle it ended up being $1.66 billion, which is obviously a substantial sum, but less than the one Oracle has been seeking and significantly less than the $4 billion figure Oracle CEO Larry Ellison was tossing around on Monday.

Good news for SAP–particularly after yesterday–and one that the company hopes is the beginning of a trend. “The ruling of the Court has an immediate and demonstrable impact on Oracle’s damages presentation, reducing the total by $500 million, from $2.2 billion down to $1.6 billion,” an SAP spokesperson told me. “This is the second such reduction by the Court and we are confident that, when the jury hears our case presentation, the outcome of the case will reflect the actual damages the limited actions of TommorowNow had upon Oracle.”

Oracle declined to comment on the matter.

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]]> http://allthingsd.com/20101110/ellison-to-self-damn-damn-i-knew-i-should-have-said-4-5-billion/feed/ 0 SAP Attorney: Board Knew TomorrowNow Was Infringing at Time of Acquisition http://allthingsd.com/20101109/sap-attorney-board-knew-tomorrownow-was-infringing-at-time-of-acquisition/ http://allthingsd.com/20101109/sap-attorney-board-knew-tomorrownow-was-infringing-at-time-of-acquisition/#comments Tue, 09 Nov 2010 20:15:33 +0000 John Paczkowski http://digitaldaily.allthingsd.com/?p=52194 Proceedings in the Oracle-SAP trial kicked off today with a comment, startling in both its source and content.

While discussing instructions to be given to the jury before it begins deliberations, SAP attorney Greg Lanier remarked that “at time of acquisition, the board was aware of [infringing] software on TomorrowNow’s computers.”

The jury wasn’t present to hear Lanier’s admission, but still it seems a rather bold one to make in open court, considering SAPs’ stance up until today–even when it decided in October not to contest Oracle’s claim for contributory infringement–has been that its executives didn’t know its TomorrowNow unit was illegally pillaging Oracle’s IP.

SAP declined comment on Lanier’s remarks.

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