HP's Livermore Describes Handshake Deal in Oracle Itanium Case

By Chris Preimesberger  |  Posted 2012-06-05 Print this article Print

It was made clear in court that the HP-Oracle relationship was founded on Oracle porting its software to HP servers--essentially without any written agreements and without any payments between the parties.

Day 2 of the Hewlett-Packard vs. Oracle lawsuit in California state Superior Court in San Jose, Calif., June 5 brought forth more testimony from HP's then-head of enterprise business, board of directors member Ann Livermore.

The issue at hand is this: Did Oracle violate contract agreements when it decided to stop making new versions of database software for Intel's Itanium processors that HP uses in its servers? HP thinks so and is asking for damages totaling about $4 billion.

Santa Clara Superior Court Judge James Kleinberg will decide the first phase of the trial on his own. Phase 1 will focus specifically on whether there is a viable contract between HP and Oracle. If Judge Kleinberg decides the original contract stands, a jury then will decide whether Oracle violated the contract, and figure out what damages are due.

On June 5, Livermore described in detail the negotiations that took place between Oracle Co-President Safra Catz and her regarding a settlement agreement involving the 2010 move of former HP CEO Mark Hurd to Oracle to be co-president with Catz. In particular, Livermore explained that the language grew out of both companies' desire to preserve their relationship and to continue to work together as they had before.

After Hurd joined Oracle in late 2010, HP became concerned, Livermore said in Day 1 testimony. "I was concerned that Mark was leaving HP with ill will toward HP. My concern was that he knew our financials. He also knew our dependence on Itanium; he knew lots and lots of things," Livermore said.

It was made clear that the HP-Oracle relationship was founded on Oracle porting its software to HP servers€”essentially without any written agreements and without any payments between the parties. Oracle continues to rely on the four contracts that existed over the course of the parties' 25-year relationship, Livermore said.

HP contends that this is a miniscule number when compared with the hundreds of instances in which Oracle ported its software to HP servers without a contract and without charge.

Livermore also said that it was fiction that Oracle decided to stop developing software for the Itanium microprocessor because it allegedly was nearing the end of its life. Livermore explained that Oracle's position was baseless because the HP-UX/Itanium platform comprised about one-third of the high-end Unix market, was extremely profitable for HP, and that HP's road map and its agreements with Intel extended the life of the Itanium road map toward the end of this decade.

Oracle, in its opening statement on June 4, argued that HP's actions immediately following the announcement proved that HP did not believe that Oracle had agreed to port its software to HP's Itanium-based servers.

Livermore testified, however, that immediately after she learned about Oracle's announcement that said it would no longer develop its software for Itanium servers, she called Catz to express her outrage over the announcement and that she informed Catz that Oracle had breached the settlement agreement signed by the parties just six months earlier.

Oracle has posted documents relating to the case here. They are regularly updated.

The expected schedule for next two days (this is subject to change):

  • Wednesday, June 6: Mike Holston, HP's former general counsel, testifies: David Tucker, an HP software engineer, testifies (if time permits); Holston will testify on topics relating to the Mark Hurd lawsuit, the negotiation of the contract at issue and related matters. Tucker will testify about the parties' course of dealing regarding the porting of Oracle software to HP's Itanium-based servers.
  • Thursday, June 7: Conclude Tucker (if necessary), conclude Ann Livermore, call Tim Aylott (if time permits).
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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