BSF Wins Landmark $1.3 Billion Copyright Infringement Verdict for Oracle
Firm Newsletter Spring 2011
On November 23, 2010, a federal court jury in the Northern District of California, after one day of deliberations, ordered SAP AG and its subsidiary TomorrowNow to pay BSF’s client Oracle Corporation $1.3 billion for copyright infringement. It was the largest copyright infringement verdict in history – by a factor of ten. In a story published by The New York Times the verdict was described as a “game-ending homerun type of result.”
BSF Chairman David Boies as lead trial counsel, led Oracle's legal team, which included BSF partners Steve Holtzman, Fred Norton, Kieran Ringgenberg and associate Beko Richardson, as well as Bingham McCutchen partners Geoff Howard, Donn Pickett and Holly House. Oracle alleged that SAP's subsidiary, TomorrowNow, improperly downloaded files from Oracle's customer support website; that SAP used the software to divert customers from Oracle, and that SAP's top executives were aware of TomorrowNow's infringing business model.
SAP argued that damages should be limited to Oracle’s lost profits and disgorgement of the profits TomorrowNow gained from the infringement. (Copyright law gives a successful plaintiff both the plaintiffs’ loss and the defendants’ gain rather than requiring a plaintiff to elect one or the other.) This approach, SAP argued, would result in damages of $40 million or less. In contrast, Oracle argued damages should not be measured by the customers SAP took, but by the amount SAP would have been required to pay, in January 2005 when the infringement began, for a license to use the copyrighted materials it infringed. Given SAP’s own contemporaneous internal projections (which turned out to have been overly optimistic), Oracle argued that such a license would have cost $1.65 billion if paid up front.
The jury accepted Oracle’s argument that it was entitled to the value of the infringed intellectual property, regardless of whether the infringer was successful.
For media coverage of this case, please click here.
Related Practice: Intellectual Property