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Hewlett-Packard and Oracle are trading barbs over the latest step on the way to trial in their dispute over Intels Itanium chip platform, with HP officials applauding a judges decision to toss Oracles request to throw out HPs case.
Santa Clara County Court Judge James Kleinberg in a court document May 14 outlined his reasons for refusing Oracles summary judgment request, essentially saying that HPs positionthat an agreement laid out between the two companies in the 2010 settlement of a previous court obligated Oracle to continue supporting Itanium in its software development planswas reasonable enough to be considered at trial.
Kleinbergs order came two weeks after he refused requests by both companies to throw out key parts of the case, saying there was enough merit to all of them to let them go to trial.
At issue is the decision by Oracle executives last year to end software support of the Itanium platform, saying that Intel had plans to stop developing the high-end chip in favor of its much more popular Xeon processors. HP railed against the decision, calling it the latest in a series of moves to harm HP Itanium customers. HP estimates there are about 140,000 joint customers running Oracle software on HPs Itanium-based Integrity and NonStop servers.
The legal dispute is the most recent example of the deteriorating relationship between the one-time close partners that started with Oracles purchase of Sun Microsystems and its hardware business, bringing it into direct competition with HP. The acrimony was further heightened when Oracle in 2010 hired ex-HP CEO Mark Hurd as president. HP sued, and officials have argued that in the settlement of that case, Oracle had agreed to continue supporting technologies that benefitted joint customers.
Oracle officials have argued that the language in the settlement doesnt rise to the level of an official agreement.
In his May 14 order, Kleinberg said that such interpretation should be decided in court, arguing that it is not unreasonable to interpret the Reaffirmation Provision as imposing a prospective obligation on Oracle to continue to offer products for HPs platforms; the plain language is readily susceptible to that interpretation. If the prior, existing obligation before [Mark] Hurds hiring involved a clear and consistent practice in which Oracle offered its product suite on all HP platforms without written porting agreements or payments, then the Court sees no inherent contradiction in reaffirming that this arrangement will continue going forward.
HP officials praised the decision, saying they were pleased that the Court ruled that the language in the HP/Oracle agreement can be interpreted to require Oracle to continue porting its software products to the HP Integrity platform, as Oracle did for years before the agreement. As the ruling states, Oracles interpretation would make the agreement illusory and should be rejected. We look forward to trial, where the details of Oracles deliberate, anti-customer business strategy to drive hardware sales from Itanium to inferior Sun servers will be revealed.
In an email to the AllThingsD news site, Oracle attorney Dan Wall saw the decision in a different light.
HP cannot be happy with this decision, Wall wrote. The Court did not accept HPs interpretation of the Hurd settlement agreement; in fact, it rejected out-of-hand the most recent version of HPs argument, which equated the contract with terms HP proposed, but Oracle rejected. HPs lawsuit, like Itanium itself, is living on borrowed time and will never succeed.
Oracle executives have argued that Intel engineers informed them of Itaniums imminent demise, a statement that Intel officialsincluding President and CEO Paul Otellinihave denied, saying they have a product road map that stretches toward the end of the decade. Oracle has accused HP of false advertising for not telling Oracle or its customers that HP was paying Intel $88 million a year to continue development of Itanium.
In a court hearing earlier this month, Wall reportedly told Kleinberg that there was no chance of the two sides reaching a settlement in the case, where HP is looking for $4 billion in damages. The case is expected to go to trial late this month or in June.