OAKLAND, Calif. (CN) — Oracle faced off against Hewlett Packard in federal court Tuesday, in a yearslong battle over whether HP violated copyrights to Oracle’s software upgrades.
Oracle sued HP in 2016, accusing the company of selling unauthorized updates to Oracle’s Solaris software — operating systems with security to protect customers from hackers — to customers who did not have support contracts with Oracle. In 2021, a federal judge denied HP's motion for summary judgment, opening the door to the trial that kicked off this week.
Oracle claims HP knew the IT support company Terix, which partnered with some of its customers, illegally used Solaris patches and updates. Attorneys for HP told jurors Tuesday that HP did not infringe on any of Oracle’s copyrights or relationships with clients or benefit from alleged acts of infringement, and that “none of the alleged conduct caused Oracle any harm.”
U.S. District Judge Jon Tigar had found a material dispute as to whether HP was “willfully blind” to Terix giving clients of both companies the copyrighted patches to Oracle’s Solaris software.
In 2015, Terix admitted to installing Solaris patches onto servers not covered by Oracle support contracts, and was later ordered to pay Oracle $58 million.
In his opening statements before the jury and Tigar on Tuesday, Oracle attorney Christoper Yates said, “This is a case about theft and accepting responsibility,”
Yates argued HP knew Terix was using Oracle's copyrighted property, profited from Terix's winning over Oracle support customers by promising the licensed updates and caused financial harm to Oracle as a result. He said many customers require Solaris updates and HP “allowed” Terix to win customers over by offering access to new patches.
HP also knew Terix was being sued and found guilty of stealing Oracle’s property, but continued to work with them, he told jurors.
“You may ask, why would a company like HPE do this?” Yates said. “It did this because it was the only way to win the business of customers who had Oracle servers.” He said one of these customers was Comcast, which was persuaded to end an Oracle contract worth over $7 million per year.
“The bottom line is, the only lawful source of Solaris patches and updates is Oracle, “ Yates said.
He argued HP knew Terix wasn’t authorized to provide access to Oracle patches, but “If HPE did not provide the connection to Terix, the customers would not have left Oracle support.” He said customers left HP support after Terix’s bankruptcy and brought “thousands of servers” back to Oracle support. However, Oracle still lost numerous contracts, some of which totaled millions of dollars over multiple years, he said.
In his opening statement, HP’s lawyer Jeffrey Thomas argued Oracle’s claim for damages based on patches for servers did not apply to many customers who did not have support contracts.
He said many customers owned Sun servers, which were older than Oracle’s version of Solaris and were not required to purchase a support contract to use server software updates. He said Oracle only enforced contracts on newer servers.
“Almost all of the nearly 15,000 servers that Oracle is saying would have been under contracts were those older servers, that the customers had bought before Oracle,” he said.
Thomas argued Terix was not involved with HP’s multivendor service business customers and was a competitor. He said after Terix’s bankruptcy, all customers who had worked with Terix stayed with HP, except for Comcast.
Among nearly 11,000 of about 15,000 servers not covered by Oracle support contracts, “there is no evidence that a single patch was installed on any of them," Thomas told jurors.
He added: “Providing patches was just not what the customers hired HPE to do."
When Terix was found guilty of intellectual theft, there was no finding of wrongdoing by anybody outside Terix and “the government did not accuse HPE of doing anything wrong," Thomas argued.
Oracle called as its first witness Ellen Eder, its senior vice president of global business practices.
Eder testified that when Oracle acquired Sun Microsystems in 2010, many customers had Sun servers. New policies in March 2010 requiring customers to purchase Oracle support contracts for software use did not apply to customers who had contracts with Sun.
Before the acquisition, Sun made some patches available for free, but "very few were available when we acquired,” Eder said. She said Sun customers were encouraged to purchase an Oracle support contract for new updates and can only seek third-party support for hardware, not software.
When HP's attorney asked if Eder knew “the majority of the Solaris updates were available for free at the time Oracle acquired Sun,” Eder said she didn’t think that was true.
Oracle has been embroiled in another lawsuit with HP, in which HP claimed Oracle breached an agreement to continue supporting its software for HP's Itanium server platform. This month, the U.S. Supreme Court declined to hear Oracle's request to take up its appeal of a $3 billion verdict for HP.
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