HP, Oracle Dispute Over Itanium Now in Judge's Hands
Hewlett-Packard and Oracle will find out sometime after mid-July whether there is a contract between the two tech giants regarding Intel's Itanium platform.
The decision by Santa Clara Superior Court Judge James Kleinberg will end the first phase of the lawsuit between HP and Oraclewhich began June 4and will set the stage for the second one. Essentially, if Kleinberg agrees with HP's assertion that there was a contract in place, then a jury will decide whether Oracle violated that contract and how much in damages it should pay HP.
The court case is the result of Oracle's decision last year to no longer develop software for the Itanium platform, on which HP has standardized its high-end HP-UX systems. The decision and subsequent legal wrangling are part of a large set of issues that has eroded what had once been a strong partnership between the two companies.
Lawyers for both HP and Oracle gave their closing arguments before Kleinberg, with each making now-familiar assertions. HP counsel Jeffrey Thomas reportedly argued that wording in the 2010 settlement of a lawsuit over Oracle's hiring of ex-HP CEO Mark Hurd is essentially a contract in which Oracle agreed to continue to support HP products as it had before the legal dispute over Hurd.
According to Bloomberg, Thomas told Kleinberg that "for years, Oracle led HP to believe it would continue to make the products available," and that after the rift between the companies over Hurd, "HP asked Oracle to put those assurances in a binding contract," which Oracle agreed to.
"The negotiations are consistent with HP's interpretation and cannot be squared with Oracle's," Thomas said, according to Reuters.
Oracle lawyer Dan Wall disagreed, arguing that there is no mention in the Hurd settlement about future versions of software or in any of the reams of documents submitted as evidence by HP.
"Oracle and HP don't have any such forward-porting agreement," Wall said, according to Bloomberg. "HP never made any serious effort to get one," relying instead on the lawsuit and a "skillful use of e-emails and other documents to make it appear there was a porting agreement that manifestly does not exist."
Kleinberg reportedly said he won't have a decision until mid-July at the earliest.
HP is looking for $4 billion in damages. The company, which by far is the largest user of Itanium chips, has seen revenue for its Business Critical Systems (BCS) groupwhich includes its Itanium-based Integrity and NonStop systemstumble since Oracle executives announced their decision to no longer develop software for the Itanium platform. In the first three months this year, the BCS group saw revenue drop 23 percent, with HP executives putting much of the blame on Oracle's Itanium announcement.
Oracle officials said they made their decision after hearing from Intel engineers that the giant chip maker was planning to end development of Itanium in favor of its x86-based Xeon platform. In doing so, Oracle joined other software makers, including Microsoft and Red Hat, in ending support for Itanium.
However, both HP and Intel executives disputed Oracle's claims, saying that the Itanium road map is laid out for most of the decade. HP officials have argued that Oracle is using Itanium to try to drive HP server users to its own systems based on the SPARC platform that Oracle inherited when it bought Sun Microsystems.
Stuck in the middle are the 140,000 or so joint customers, many of whom run Oracle database or other enterprise software on HP Integrity servers. Oracle officials, in countersuing HP, claimed that HP was not being honest with the customers about Itanium's future or the fact that HP had paid Intel almost $500,000 to keep Itanium development going.