HP defeats Oracle in legal battle
Wednesday, August 1, 2012
SAN JOSE, Calif. -- In a legal tussle industry observers had billed as a battle between two tech titans, Hewlett-Packard Co. won a major victory Wednesday when a judge ruled that Oracle Corp. violated a contract by not continuing to provide new software for an HP computer server.
The decision following several weeks of trial testimony before Santa Clara County (Calif.) Superior Court Judge James Kleinberg paves the way for a second trial to determine if Oracle should pay damages, as HP has alleged. It is the second major recent legal defeat for Oracle against another Silicon Valley corporation. On May 31, a federal judge rejected its claim that Google Inc. had improperly used key elements of Oracle's software.
"Today's proposed ruling is a tremendous win for HP and its customers," the Palo Alto, Calif., technology giant said in a prepared statement. "We expect Oracle to comply with its contractual obligation as ordered by the court."
Oracle spokeswoman Deborah Hellinger said the Redwood City, Calif., company plans to appeal the ruling.
The trial before Kleinberg revolved around a settlement Oracle and HP negotiated following Oracle's hiring of Mark Hurd as co-president in 2010, a month after he resigned as HP's CEO after unproved harassment allegations stemming from his relationship with a contractor. Fearing Hurd might give proprietary information to Oracle, HP filed suit, and the two companies worked out a settlement.
Oracle characterized the settlement as merely a general pledge of mutual cooperation, but HP claimed it was a contract requiring Oracle to keep making new versions of software for a type of HP servers that use Itanium microprocessors from chipmaker Intel Corp. When Oracle announced in March that it would stop updating its software for the Itanium system, HP sued, claiming it could lose $4 billion in server sales through 2020 because of Oracle's decision.