Industry Insights

Oracle Won Whopping $46M in Legal Fee Against Rimini Street

Venus Tamturk

By Venus Tamturk

September 23, 2016

Google, HP, Oracle

The U.S. District Court for the District of Nevada has awarded Oracle $46.2 million in attorneys’ fees and costs against rival software company Rimini Street, and Rimini Street CEO Seth Ravin personally, due to continued computer access violations. This is on top of the $50 million in damages awarded by the jury last year, including a $14 million award against Ravin personally. U.S. District Judge Larry Hicks found that Rimini's copyright infringement arose from a "clear misreading of Oracle's software licensing agreements and a conscious disregard for the manner that Rimini used and housed Oracle's copyrighted software programs on its own servers."

Dorian Daley, Executive Vice President, General Counsel and Secretary at Oracle, said: "The court's order sends a powerful message to protect innovators. This order helps to protect Oracle's investment in its software to benefit its customers and confirms that Rimini's infringement was unrepentant. Rimini and Ravin continue to falsely assert that their conduct is permissible. Their customers and prospective customers are on notice of their grave misconduct and the consequences of that misconduct."     
In total Rimini Street has been ordered to pay Oracle $124.3m. In a statement, Rimini Street said it accepts the award of a one-off license payment to Oracle of $35.6m but intends to appeal the remaining $88.7m of the total $124.3m. Rimini Street touched on the fact that Oracle didn't win as much in damages as it had hoped in a statement: 

“Oracle, in a consistent pattern of business conduct, over-reached and claimed more than $350 million in total damages and costs. The Court only awarded Oracle a total of $124.3 million, which included a one-time fair-market license payment of $35.6 million for Rimini Street's "innocent infringement" of certain Oracle software copyrights. The total award is less than 36% of the total sought by Oracle.

The Court will issue an "injunction," which is a court order to simply prohibit the previous conduct by Rimini Street that was found by the Jury and Court to be infringing. However, since Rimini Street had ceased said conduct by July 2014, there is no expected impact on any current or future service offering, or on Rimini Street's current or future ability to service any of its clients.”

In 2010, Oracle sued Las Vegas-based Rimini and Ravin for copying three of Oracle's copyrighted programs, PeopleSoft, JD Edwards and Siebel, onto Rimini’s own computer systems. Rimini had used the copies, Oracle alleged, to provide “software support” services to four of its customers: the City of Flint, the Pittsburgh Public Schools, Giant Cement and Novell. The trial was five years in the making and, in the end, Oracle was granted $50 million in damages

The news comes hot on the heels of the press release Rimini Street issued, stating that the company has achieved a combined 39% revenue growth across all Oracle product lines for the 12-month period ending June 30, 2016, compared to the prior 12-month period. The growth was led by Oracle Database and Middleware product lines which grew by 205% and Oracle E-Business Suite (EBS) which grew by 48% during the same time period.

Oracle’s Other Litigations

The recent court decision hit the spot for Oracle only because it was granted $46.2 million but it also came along after Oracle’s recent litigation setbacks against Google and Hewlett-Packard Enterprise

In 2010, Oracle attempted to sue Google for $9 billion, claiming that Google had infringed its copyright by using 11,500 lines of Java code in its Android operating system. Last May the jury announced that they couldn’t find copyright violations of Oracle’s Java APIs by Google while developing its Android operating system. The jury said it was “fair use” as Google was found to have used 37 APIs from Java, or about 11,000 lines of code, out of Android's millions of lines of code. However, Oracle has recently appealed the May verdict of the lawsuit, demanding a share of Google’s profit of $42 billion gained from Android powered by its Java APIs, and stated that "Google's financial rewards are as 'conspicuous' as they come, and unprecedented in the case law."

In 2011, HP Enterprise, which was formed after its parent company Hewlett-Packard split into two separate entities as HP Inc. and HP Enterprise in Nov 2015, sued Oracle after the database giant stopped porting its database and other products to Itanium. Last July, Oracle lost the lawsuit against HP Enterprise. The state court of California directed Oracle to pay $3 billion in damages. Oracle's lawyer said that Oracle still thinks that it's in the right and will appeal. 

Besides Google and HPE, in June, Oracle’s former senior Finance Manager, Svetlana Blackburn filed a lawsuit against the company, alleging that the company had terminated her service when she resisted some manipulative accounting practices in Oracle’s cloud-computing business, while an Oracle investor Grover M. Klarfeld also filed a lawsuit that alleged Oracle of “improper accounting practices to inflate the company’s cloud-computing revenues by millions of dollars”.

Maintenance and support are a big revenue source for legacy companies like Oracle and players like Rimini are always a big threat. However, law proceedings can be a double-edged sword of interest and hindrance from outside observers. The good news is, the field of intellectual property law is gaining traction in all sectors so we may just see more and more news items like this in the near future. 

Venus Tamturk

Venus Tamturk

Venus is the Media Reporter for CMS-Connected, with one of her tasks to write thorough articles by creating the most up-to-date and engaging content using B2B digital marketing. She enjoys increasing brand equity and conversion through the strategic use of social media channels and integrated media marketing plans.

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