Clash of the Technology Titans - Jury Awards Oracle $1.3bn from SAP in Illegal Downloading Case

Home Knowledge Clash of the Technology Titans – Jury Awards Oracle $1.3bn from SAP in Illegal Downloading Case

Clash of the Technology Titans - Jury Awards Oracle $1.3bn from SAP in Illegal Downloading Case

January 21, 2011

A US jury has awarded Oracle $1.3 billion from SAP which is believed to be the largest ever award for a case involving copyright infringement. The infringement was conducted by TomorrowNow, a now obsolete subsidiary of SAP. Oracle claimed that TomorrowNow made copious illegal downloads and copies of Oracle’s software in order to lure customers away from Oracle and circumvent the payment of licensing fees. It is reported that the evidence at trial revealed an automated program which facilitated the illicit downloading of the software from Oracle’s customer service website. A statement issued by Oracle asserts that “SAP stole thousands of copies of Oracle software and then resold that software and related services to Oracle’s own customers.”

Liability was not contested by SAP. Oracle claimed damages based on the value of its intellectual property and the lost business. Interestingly, it is reported that SAP successfully lured away only 358 customers from Oracle. The level of the award highlights the scale of the value attributed to Oracle’s intellectual property.

Following the judgment, SAP said in a statement that it “will pursue all available options… This will unfortunately be a prolonged process and we continue to hope that the matter can be resolved appropriately without more years of litigation.”

There may yet be further repercussions for the company as it is reported that the US Department of Justice is conducting investigations into the matter.

Although this is a US case and consequently is not a legal authority in Ireland it still serves to illustrate the colossal value placed on the intellectual property of leading software providers. Notwithstanding the landmark award, the reputational damage suffered by SAP may be even higher. This case serves as a warning that intellectual property breaches will not be permitted and that the court system is willing to generously compensate the aggrieved party.

For further information, please contact John Magee or David Cullen of our Technology & Commercial Contracts Department.