SAP faces $1.7b bill for illegal downloads

Software giant SAP has been ordered to pay NZ$1.7 billion for stealing Oracle IP from its servers. Photo / Supplied

SAP, the world's largest maker of business application software, must pay US$1.3 billion ($1.7 billion) to Oracle for copyright infringement by a now-defunct software maintenance unit, a federal jury in California decided.

Yesterday's verdict is the largest jury award of this year, according to Bloomberg data.

It is the largest ever for copyright infringement and the 23rd-largest of all time for any jury award.

The jury awarded the damages following an 11-day trial in Oakland, California.

Oracle, the second-biggest maker of business software, sued Walldorf, Germany-based SAP in 2007 claiming its United States-based unit made hundreds of thousands of illegal downloads and several thousand copies of Oracle's software to avoid paying licensing fees and steal customers.

"We are, of course, disappointed by this verdict and will pursue all available options, including post-trial motions and appeal if necessary," Bill Wohl, an SAP spokesman, said.

"This will unfortunately be a prolonged process and we continue to hope that the matter can be resolved appropriately without more years of litigation."

Geoffrey Howard, an attorney for Redwood City, California- based Oracle, said before the verdict that the breadth of the illegal downloading was "unprecedented" in the software industry.

"The underlying theme of the case came down to damages," David Boies, another Oracle attorney, said after the verdict.

"The facts of damages proven by the contemporaneous record of both companies was quite clear."

SAP didn't contest that it was liable for the infringement by its TomorrowNow unit, which it acquired in 2005 and closed in 2008.

SAP lawyers told the jury at trial that Oracle's estimate that it was owed at least US$1.7 billion for the infringement was grossly exaggerated.

SAP said it owed about US$40 million.

The largest jury verdict in a copyright-infringement case previously was US$136 million awarded by a Los Angeles jury in 2002.

That lawsuit was brought by the Recording Industry Association of America against Media Group for copying and distributing 1500 songs by artists including Elvis Presley, Madonna and James Brown.

- Bloomberg