Oracle-HP ruling highlights risks of IT vendor partnerships

03.08.2012
The by a California judge saying Oracle has to keep porting its software to Hewlett-Packard's Itanium-based servers is not the end of the between the two companies, but it could have an effect on the broader IT industry.

Oracle has to keep porting its database and other software to servers based on HP's Itanium HP-UX platform for as long as those servers remain on sale, Judge James Kleinberg of the Santa Clara County Superior Court wrote in a proposed ruling on Wednesday. Oracle said it would appeal the decision, and it has 15 days to do so.

The judge's decision concludes the first part of the trial, which was limited to determining whether the two companies had a contract and what its terms were. Assuming the decision becomes final, the case will move on to a second phase in which a jury will determine whether Oracle breached that contract and what damages it should pay HP. The next court date will be a case management hearing on Aug. 22.

But Kleinberg's order on Wednesday signaled that the so-called Hurd Agreement, which the companies negotiated after former HP CEO Mark Hurd left the company and joined Oracle, will be taken seriously as a legal commitment. Oracle co-President Safra Catz had dismissed the first part of the document, in which the companies said they would keep working together just like before the fight over Hurd, as a non-binding "public hug."

The judge saw things otherwise. He interpreted the Hurd Agreement as a contract, pointing to a key sentence in the first paragraph: "Oracle will continue to offer its product suite on HP platforms ... in a manner consistent with that partnership as it existed prior to Oracle's hiring of Hurd."

"The sentence can only be reasonably interpreted as requiring Oracle to continue offering its product suite on HP's Itanium platforms," Kleinberg wrote. He then said Oracle must continue porting all products that it made available for Itanium at the time of the deal, on Sept. 20, 2010, until HP discontinued the chip platform. That would include all new releases, versions and updates, he wrote.