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Jury orders Oracle to pay HP $3 billion in damages in a 4 year old suit over HP’s Itanium servers

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In a four year old lawsuit between HP and Oracle over the former’s Itanium servers, a San Jose jury has ruled that Oracle must pay Hewlett-Packard Enterprise $3 billion in damages. The case was filed by HP after Oracle breached its contract to provide Itanium support in its namesake database and Linux distribution.

Oracle decided to stop supporting Itanium systems running HP’s HP-UX operating system in 2011 after Intel made it clear that the chip was nearly obsolete. Intel had said then that it would be focusing on its x86 microprocessor. Following this, HP claimed that it had an agreement with Oracle that support for Itanium would continue, without which the equipment using the chip would become useless.

The contract HP was quoting was a 2010 agreement between the two companies in which the database firm promised to support HP’s Itanium systems. Sure enough, after HP filed a lawsuit, a jury decided in 2012 in HP’s favour.

The judge ordered Oracle to continue supporting the Itanium architecture and finalized the decision stating that HP was eligible to claim damages. Following this, the former kept supporting HP’s Itanium since late 2012. But HP’s due damages were not determined.

Four years later, the two companies are back in court to determine what the exact amount is.

HP stated that the act of dropping support for Oracle’s important database software greatly affected the commercial feasibility of its Itanium products. It added that the whole ploy as to drive sales of Oracle’s own Sun hardware.

The jury agreed with HP and awarded it the full amount it was seeking. The result– HP got compensated for both lost sales and damages.

HP is gratified by the jury’s verdict, which affirms what HP has always known and the evidence overwhelmingly showed,

John Schultz, executive vice president and general counsel of Hewlett Packard Enterprise, told Reuters in an e-mailed statement, saying that Oracle’s decision to stop the software development

was a clear breach of contract.

Oracle, on the other hand, says that it will appeal to the jury against this decision. The facts the company is piling forward are that the Itanium processor was clearly near the end of its life by 2011. It adds that Intel has not introduced any new models since November 2012 proving that the products were near obsolete. The company also states that the contract never obligated the database firm to support HP’s hardware indefinitely.

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