By Agency Reporter

Wednesday, 24 Nov 2010

CALIFORNIA: Oracle Corporation‘s chief, Larry Ellison, pulled numbers ”out of the air” when he estimated SAP AG owed billions of dollars in damages for the theft of Oracle software, a SAP lawyer told a United States court on Monday, Reuters reported on Tuesday.

For his part, lead Oracle attorney, David Boies, said the high-profile case was about the sanctity of the software industry‘s intellectual property, not just a highly public battle of two technology heavyweights.

”Protection of intellectual property is at the heart of the software industry,” Boies said.

With that, each side concluded its closing arguments and a federal court jury began deliberating on Monday afternoon in a trial that has captivated Silicon Valley because of the high profile of the executives and companies involved.

From the outset of the trial, SAP acknowledged that a now-defunct subsidiary, TomorrowNow, stole Oracle software. But it also contested Oracle claims that damages for the theft should be in the billions of dollars.

SAP said Oracle should be paid at most $40m, while Oracle argued it was owed at least $1.65bn.

A decision on the amount of compensation SAP will pay Oracle could come as early as next week.

Oracle‘s CEO called for damages of $4bn, but SAP attorney, Robert Mittelstaedt, said testimony from Oracle‘s own expert showed even he thought Ellison‘s demand was too high.

Ellison ”just said it, as if when he says something, you have to believe it,” Mittelstaedt told the jury.

Testimony in the trial wrapped up on Friday without a hoped-for appearance by former SAP chief and current Hewlett-Packard Company CEO, Leo Apotheker.

Apotheker instead addressed analysts and reporters on separate calls after HP posted stronger-than-expected quarterly results on Monday, but he did not comment directly about the trial.

During the trial, Oracle linked Apotheker to the operations of TomorrowNow. But it did not appear to produce evidence to prove he knew of the theft.

Ellison has publicly charged Apotheker with overseeing an ”industrial espionage scheme” to steal Oracle software. But both SAP and HP have characterised the Apotheker issue as a sideshow and say Oracle has offered no proof to back up its allegations about him.

In court on Monday, Boies said SAP believed it could use its TomorrowNow subsidiary, which wrongfully downloaded millions of Oracle files, as a ”liability shield” that could take the fall for copyright infringement.

SAP‘s executive board must have known about the infringement, Boies said, because there was no other way for TomorrowNow to offer the services that it did. The subsidiary devoted scant resources to research and development, Boies said.

But Mittelstaedt responded that Oracle was trying to get jurors to award damages far in excess of TomorrowNow‘s true value.

”They are trying to trick you into doing that,” Mittelstaedt said.

Mittelstaedt said SAP never used the software downloaded, and that the subsidiary only netted a handful of customers, representing little profit.

At a news conference outside the courtroom, Oracle attorney Geoffrey Howard said that, regardless of what the jury does, SAP will never again be known as ”a trusted adviser.”

SAP‘s spokesman, William Wohl, countered that the mark of corporate leadership is how a company corrects its mistakes.

Source: Punch