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2/8/2012
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Oracle Rejects $272 Million SAP Award, Demands Retrial

Five-year-old copyright infringement lawsuit will continue, as Oracle seeks to put SAP execs back on the witness stand.

Oracle turned down $272 million in court-ordered damages from SAP to resolve the copyright infringement lawsuit in which Oracle's rival admitted its now-shuttered TomorrowNow services unit stole proprietary information in order to provide third-party support services to Oracle's business customers.

SAP ultimately accepted liability for TomorrowNow's actions in the five-year-old legal brawl in which a jury awarded Oracle a $1.3 billion award. But in September, U.S. district judge Phyllis Hamilton lopped more than $1 billion from the jury's award after concluding it was "grossly excessive."

Hamilton gave Oracle the choice of either accepting the reduced damages or seeking a new trial. Oracle took that latter approach through a court filing Monday, making it clear it will try to prove the jury got it right and creating another chance to put SAP executives on the witness stand.

"We are disappointed that Oracle has passed up yet another opportunity to resolve this case," SAP spokesman James Dever said in a statement on Tuesday. "We will work to bring this case to a fair and reasonable end."

Oracle originally sued SAP in March 2007, claiming that its TomorrowNow tech services unit "copied and swept thousands of Oracle products and other proprietary and confidential materials into its own servers" using fake log-ins or credentials stolen from legitimate, high-profile Oracle customers such as Honeywell, Merck, Bear Stearns, and others.

[ Want more on the Oracle-SAP rivalry? Read SAP Reports Record Revenue, Gains On Oracle. ]

SAP acquired TomorrowNow for $10 million in 2005. During the trial, SAP executives denied knowledge of TomorrowNow's actions but ultimately accepted blame and publically apologized to Oracle.

Legal expert Eric Goldman, director of the High Tech Law Institute at Santa Clara University, told InformationWeek he was not surprised that Hamilton reduced the $1.3 billion jury award, describing the damages as guesswork. "Oracle's lawyers did a very good sales job to the jury, but they couldn't provide any supporting data to back up their numbers," Goldman said.

In a new trial, Oracle will presumably bolster the case that TomorrowNow's actions cut into Oracle revenue. But the real motivation may be to put SAP on the defensive and rehash SAP board and executive oversight of the ill-fated TomorrowNow acquisition.

Oracle declined to comment on its latest legal moves.

Oracle has a similar lawsuit going against Rimini Street, another third-party provider. Filed in 2010, that suit alleges that the vendor swiped Oracle software and intellectual property so it can provide cut-rate, third-party support to Oracle customers.

More than 700 IT pros gave us an earful on database licensing, performance, NoSQL, and more. That story and more--including a look at transitioning to Win 8--in the new all-digital Database Discontent issue of InformationWeek. (Free registration required.)

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