Judge Rules SAP Must Pay Interest on $1.3B Judgment to Oracle

By Chris Preimesberger  |  Posted 2010-12-29 Print this article Print

Oracle had asked for $211 million extra in interest from its longtime competitor but will get a lot less.

Adding insult to injury, a federal court judge ruled Dec. 28 that enterprise software maker SAP must pay Oracle prejudgment interest on its Nov. 23 $1.3 billion copyright infringement verdict, but it was about $195 million less than the amount requested by Oracle.

After it won the monthlong jury-trial case in the Oakland, Calif. federal district court, Oracle had asked presiding Judge Phyllis Hamilton for about $211 million in interest from its longtime competitor.

SAP, the largest enterprise application provider in the world, contended in court documents that it shouldn't have to pay interest on the $1.3 billion judgment, which already is the largest intellectual property-connected financial penalty in U.S. legal history.

Sometimes in cases that involve a jury award, interest is awarded to the plaintiff dating back to when the case started in proceedings.

SAP lawyers subsequently asked Hamilton to use a different methodology should she decide interest was necessary. The judge agreed to use SAP's formula without detailing the actual amount SAP would have to pay.

In an email to eWEEK, SAP spokesman Saswato Das revealed the number to be about $16.5 million. An Oracle spokesperson declined comment in answer to an eWEEK query.

"While we believe that Oracle should only be awarded damages, we appreciate that the Court agreed with SAP on the proper calculation of interest in this case which dramatically lowered the amount," Das told eWEEK. "The interest the Court ordered, based on the statutorily-set interest rate of .3% and the accrual period of Sept. 29, 2006 through Dec. 23, 2010, is approximately $16.5 million, rather than the over $200 million Oracle was seeking."

Oracle, in its lawsuit filed in 2007, claimed that SAP -- through a since-liquidated affiliate division called TommorowNow -- illegally downloaded more than 8 million instances of its customer-support software and hundreds of thousands of pages of supporting documentation from one of its Web sites, then used those tools to lure some 350 customers away from Oracle and over to SAP.

SAP took corporate responsibility for the misdeeds in a court document filed Oct. 28 and officially apologized on Nov. 16.  

SAP already has paid $120 million for court costs to Oracle and had argued that another $40 million in restitution would constitute a fair amount. Oracle originally claimed in court documents that its lost assets were valued at $2.15 billion, although CEO Larry Ellison testified in court Nov. 8 that $4 billion was closer to the actual amount.

Ultimately, the eight-person jury settled on the $1.3 billion figure. Now there's another $16.5 million for SAP to pay out.

Chris Preimesberger Chris Preimesberger was named Editor-in-Chief of Features & Analysis at eWEEK in November 2011. Previously he served eWEEK as Senior Writer, covering a range of IT sectors that include data center systems, cloud computing, storage, virtualization, green IT, e-discovery and IT governance. His blog, Storage Station, is considered a go-to information source. Chris won a national Folio Award for magazine writing in November 2011 for a cover story on Salesforce.com and CEO-founder Marc Benioff, and he has served as a judge for the SIIA Codie Awards since 2005. In previous IT journalism, Chris was a founding editor of both IT Manager's Journal and DevX.com and was managing editor of Software Development magazine. His diverse resume also includes: sportswriter for the Los Angeles Daily News, covering NCAA and NBA basketball, television critic for the Palo Alto Times Tribune, and Sports Information Director at Stanford University. He has served as a correspondent for The Associated Press, covering Stanford and NCAA tournament basketball, since 1983. He has covered a number of major events, including the 1984 Democratic National Convention, a Presidential press conference at the White House in 1993, the Emmy Awards (three times), two Rose Bowls, the Fiesta Bowl, several NCAA men's and women's basketball tournaments, a Formula One Grand Prix auto race, a heavyweight boxing championship bout (Ali vs. Spinks, 1978), and the 1985 Super Bowl. A 1975 graduate of Pepperdine University in Malibu, Calif., Chris has won more than a dozen regional and national awards for his work. He and his wife, Rebecca, have four children and reside in Redwood City, Calif.Follow on Twitter: editingwhiz

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