Oracle Wants New Trial Against SAP After Judge Threw Out Verdict

By Karen Gullo - Feb 7, 2012 12:01 PM GMT+0700

Oracle Corp. decided it would rather have a new trial against SAP AG for copyright infringement than accept a judge’s $1 billion reduction in a jury verdict it won against its competitor.

U.S. District Judge Phyllis Hamilton in Oakland, California, threw out a $1.3 billion verdict against SAP in September, calling it “grossly excessive” and not supported by the evidence. SAP, the biggest maker of business-management software, should get a new trial if Oracle rejects her decision to reduce the amount to $272 million, Hamilton said in her ruling.

“Oracle’s objective is to obtain clarification of the law and, if it is right about what the law is and what the evidence supports in this case, to vindicate the verdict of the jury and Oracle’s intellectual property rights as a copyright owner,” Oracle attorney Geoffrey Howard said in a filing yesterday in federal court in Oakland.

In the 2010 trial, Oracle accused SAP’s TomorrowNow software-maintenance unit of making hundreds of thousands of illegal downloads and several thousand copies of Oracle’s software. Oracle said SAP’s aim was to avoid paying licensing fees and to steal customers.

SAP and Redwood City, California-based Oracle, the second- biggest maker of business software, are competitors in the market for programs that businesses use to automate payroll, human resources, accounting and other tasks.

Hypothetical License

SAP, based in Walldorf, Germany, didn’t contest that it was liable for the infringement by TomorrowNow, which it closed in 2008. Jurors based their award on the value of a hypothetical license that SAP would have needed to use Oracle’s software.

Hamilton said there was no evidence that Oracle had ever granted a license that would permit a competitor to use its software to compete for Oracle customers. Oracle can’t recover lost license fees because, without such evidence, any award would be subjective and speculative and not based on objective evidence, she said.

“We are disappointed that Oracle has passed up yet another opportunity to resolve this case,” Jim Dever, an SAP spokesman, said in an e-mail. “We will continue to work to bring this case to a fair and reasonable end.”

The case is Oracle v. SAP, 07-1658, U.S. District Court, Northern District of California (Oakland).

To contact the reporter on this story: Karen Gullo in San Francisco at kgullo@bloomberg.net

To contact the editor responsible for this story: Andrew Dunn at adunn8@bloomberg.net