Supreme Court Cuts Extra Costs From Award to Oracle

WASHINGTON (CN) – After prevailing in a copyright case, software giant Oracle USA was improperly awarded costs that went beyond those allowed by federal law, the Supreme Court ruled Monday. 

Oracle initiated the dispute here some years ago in Nevada, complaining that a firm named Rimini Street Inc. had copied its programs without a license to offer tech support to Oracle customers.

In addition to taking home some $50 million in damages, Oracle won an award of $28.5 million in attorneys’ fees, $3.4 million more in costs and $12.8 million for litigation expenses including witnesses, jury consulting and e-discovery.

The District Court arrived at the $12.8 million figure by focusing on the reference to “full costs” in Section 505 of Title 17, but Rimini Street balked that this finding went beyond the six categories of costs the statute otherwise specifies.

On Monday, the Supreme Court was unanimous in reversing for Rimini.

“The adjective ‘full’ in §505 … does not alter the meaning of the word ‘costs,’” Justice Brett Kavanaugh wrote for the court. “Rather, ‘full costs’ are all the ‘costs’ otherwise available under law. The word ‘full’ operates in the phrase ‘full costs’ just as it operates in other common phrases: A ‘full moon’ means the moon, not Mars. A ‘full breakfast’ means breakfast, not lunch. A ‘full season ticket plan’ means tickets, not hot dogs. So too, the term ‘full costs’ means costs, not other expenses.”

Kavanaugh also took issue with the history lesson that Oracle offered to support keeping its award.

“If Oracle’s account of the history were correct, federal courts starting in 1831 presumably would have interpreted the term ‘full costs’ in the Copyright Act to allow awards of litigation expenses that were not ordinarily available as costs under the applicable costs schedule,” the opinion states. “But Rimini points out that none of the more than 800 available copyright decisions awarding costs from 1831 to 1976 — that is, from the year the term ‘full costs’ first appeared in the Copyright Act until the year that the act was last significantly amended — awarded expenses other than those specified by the applicable state or federal law. Oracle has not refuted Rimini’s argument on that point. Oracle cites no §505 cases where federal courts awarded expert witness fees or other litigation expenses of the kind at issue here until the Ninth Circuit’s 2005 decision adopting the interpretation of §505 that the Ninth Circuit followed in this case.”

Mark Perry, an attorney for Rimini Street at the firm Gibson Dunn, noted in a statement Monday that today’s opinion “brought cost awards under the Copyright Act back into line with hundreds of other federal statutes.” 

Rimini Street also noted that the $12.8 million refund awarded today “is in addition to the $21.5 million that Oracle previously returned to Rimini Street, following a decision by the Ninth Circuit.”

The Ninth Circuit is still considering Rimini Street’s appeal of the $28.5 million awarded to Oracle for attorneys’ fees.

“We are pleased with this latest victory in the highest court, and look forward to continuing our fierce competition with Oracle in the marketplace by providing the best enterprise software support service and value for Oracle licensees worldwide,” Rimini Street CEO Seth A. Ravin said Monday in a statement. 

Rimini Street has emphasized that Oracle prevailed on only one of its its 24 claims when the case went to trial in 2015.

“Rimini Street was found liable only for ‘innocent’ copyright infringement,” the company said, adding that Ravin individually was exonerated on all claims. 

Kirkland & Ellis attorney Paul Clement represents Oracle but has not returned an email seeking comment.

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