HP and Oracle head to court in $4 billion ‘divorce’ case over chip

LAWYERS for computing giants HP and Oracle fired the opening salvos in a bitter $4 billion (£2.6bn) court battle yesterday after Oracle stopped making software for one of HP’s servers.

Big names from both sides – including Oracle chief executive Larry Ellison, Oracle president Mark Hurd and HP board member Ann Livermore – could take the stand during the trial.

Oracle last year stopped developing software for use with Itanium chips made by Intel, which are used in some of HP’s servers. According to Oracle, Intel had made it clear the chip was nearing the end of its life.

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But HP argues that Oracle and HP had agreed that support for Itanium would continue, without which the HP equipment using the chip would become obsolete.

HP said the commitment was affirmed when it settled an earlier lawsuit over Oracle’s hiring of former HP chief executive Mark Hurd. HP sued Oracle in California’s state court last year, calling Oracle’s recruitment of Hurd “anti-customer”.

Oracle says HP’s claims “cannot support” its damages estimate, and has counter-sued HP for false advertising, asserting that HP failed to disclose the terms of its contract with Intel.

Instead of a jury, Santa Clara Superior Court Judge James Kleinberg will decide the first phase of the trial – whether there is a contract between HP and Oracle, and its terms, said HP spokesman Michael Thacker.

If Kleinberg decides in HP’s favour, then a jury will decide whether Oracle violated the contract, and damages, Thacker said.

In court last month, Kleinberg compared the case to a divorce, saying “this case appears to be the end of a marriage” between the technology giants.

Although Intel is not a party in the lawsuit, its chief executive, Paul Otellini, might also testify.