Update: The Acquisition That Keeps On Giving. SAP Agrees To Pay Criminal Fine of $20 million For TomorrowNow's Transgressions.

Posted on September 15, 2011 by Paul Stanfield

 In 2005, SAP acquired TomorrowNow, a company designed to provide third party maintenance for Oracle software.  Unfortunately, TomorrowNow chose to reduce its operating costs by pirating a bunch of Oracle software and then using it in its business.  

Oracle found that to be somewhat offensive and sued TomorrowNow and SAP and originally obtained a judgment against them for $1.3 billion dollars.  We recently noted that a judge had reduced this amount to a mere $272 million.

During the civil trial, federal prosecutors listened and then filed criminal charges against TomorrowNow.  TomorrowNow is basically defunct and has fewer than ten employees and no individuals were named in the indictment.  This was done as part of a plea bargain and SAP worked out a deal where they would pay a $20 million dollar fine for TomorrowNow, even though SAP was not named in the indictment either.  One would have to assume that some individual actually performed the criminal act of stealing the software, although in this case, it appears that Mitt Romney is correct in that: "Corporations are people, my friend."  At least for plea bargains.

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Court Reduces Oracle's Judgment Against SAP From $1.3 Billion (With a B) to $272 Million (With a M).

Posted on September 1, 2011 by Paul Stanfield

Once upon a time, SAP purchased a company called TomorrowNow.  TomorrowNow apparently downloaded Oracle software thousands of time in an effort to get the software cheaply (free) and obtain some of Oracle's customers.  Oracle sued and SAP did not contest the fact of the downloads but alleged that the damages to Oracle should be equal to the profits that Oracle would have realized from the pirated software.  The Court allowed the jury to find damages based on a "hypothetical license" that would have existed between Oracle and SAP if Oracle allowed SAP to use the software in question.  This allowed the jury to find damages in the amount of $1.3 billion, the largest copyright infringement verdict in history.  However, today, in the U.S. District Court for the Northern District of California, the judge found that there was no evidence that Oracle would have ever granted such a license and that damages must be based on evidence and not speculation or guesswork.  The judge then said that the judgment could be reduced to $272 million and if the parties could agree on that, then it would be settled.  If they do not agree, then a new trial will be ordered.

It's an interesting world when a $272 million dollar verdict is considered a victory for the defense.

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Oracle vs. Google, Godzilla vs. Mothra, Perseus vs. The Kraken and other Titanic struggles

Posted on August 17, 2010 by Paul Stanfield

Consider this abbreviated time line:

November 5, 2007 - Google, T-Mobile, HTC, Qualcomm and Motorola announce the release of Android and announce the creation of The Open Handset Alliance comprised of 34 companies that will free the mobile world of all restrictions (the last part is made up).  Nowhere in the announcement does Java get mentioned.

Same day (almost like they knew it was coming) - The Chairman and CEO of Sun (possessor of Java) heartily congratulates Google et al on the release of Android and hails the salutary effect it will have on the Java community.  The blog entry goes out of its way to call Android a "Java/Linux phone platform" and "a Java based platform".

April 20, 2009 - Oracle buys Sun.  In the press release announcing the sale, Oracle calls Java "the most important software Oracle has every acquired."

 August 12, 2010 - Oracle files suit against Google alleging "In developing Android, Google knowingly, directly and repeatedly infringed Oracle's Java-related intellectual property. This lawsuit seeks appropriate remedies for their infringement."

Now what happens?  Google will claim that they aren't using Java but built their own version of this platform called Dalvik using approved clean room methods and therefore haven't infringed on anything.  Google hasn't filed an answer yet and probably won't for some time.  Then the fun will start.  This has the potential to be a very visible and influential suit with ramifications for years to come.  Google is not likely to be the last company with Defendant after their name in this matter.  There are millions and millions of devices with Android running on them.  Plus it involves some heavyweights.

Of course, Oracle's Larry Ellison is involved.  He has some repute in the high tech world. 
Oracle's legal team in the case includes the mega firm Morrison and Foerster (whose domain name proudly is "mofo") and David Boies, a well-known attorney who represented the U.S. Justice Department in its antitrust action against Microsoft.  He also represented former Vice President Al Gore in the 2000 Florida recount battle and SCO in their 2003 suit against IBM over Linux. He also was recently involved in the Prop 8 battle in California, so he wins some and loses some.

If your Ambien prescription has run out, the complaint can be read here.  This case will be tried in the post-Bilski world, so who knows what that means.  Stay tuned.  This could get good.
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