Oracle wins biggest-ever copyright infringement award

A jury has awarded Oracle $1.3 billion for copyright infringement from SAP after an 11-day federal court trial in California.

Oracle claimed that SAP had made hundreds of thousands of illegal downloads and thousands of copies of its software, avoiding paying licensing fees. The illegal copying was carried out by TomorrowNow, SAP’s now-defunct third party support subsidiary.

“For more than three years, SAP stole thousands of copies of Oracle software and then resold that software and related services to Oracle’s own customers,” says Oracle President Safra Catz.

“Right before the trial began, SAP admitted its guilt and liability; then the trial made it clear that SAPs most senior executives were aware of the illegal activity from the very beginning.”

The verdict marks the biggest ever award for copyright infringement, which Forrester analyst Paul Hammerman believes shows a lack of understanding on the part of the jury. SAP had argued that it owed $41 million at most, representing Oracle’s probably lost earnings for support services.

“The $1.3 billion verdict in the Oracle v SAP case is surprising, given that… TomorrowNow was fixing glitches and making compliance updates, not trying to resell the software,” says Hammerman.

“The jury felt that the appropriate damage award was based on the fair market value of the software that was illegally downloaded rather than Oracle’s lost revenues for support.”

SAP is expected to appeal, and has a good chance of getting the award cut dramatically, say analysts. There could be years more litigation to come.