Oracle Corporation et al v. SAP AG et al

Filing 484

Declaration of Lawrence J. Ellison in Support of 483 Memorandum in Opposition, Plaintiffs' Opposition to Defendants' Motion for Partial Summary Judgment Regarding Plaintiffs' Hypothetical [Fair Market Value] License Damages Claim filed byOracle EMEA Limited, Oracle International Corporation, Oracle USA Inc., Siebel Systems, Inc.. (Related document(s) 483 ) (House, Holly) (Filed on 9/23/2009)

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Oracle Corporation et al v. SAP AG et al Doc. 484 Case4:07-cv-01658-PJH Document484 Filed09/23/09 Page1 of 4 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 BINGHAM McCUTCHEN LLP DONN P. PICKETT (SBN 72257) GEOFFREY M. HOWARD (SBN 157468) HOLLY A. HOUSE (SBN 136045) ZACHARY J. ALINDER (SBN 209009) BREE HANN (SBN 215695) Three Embarcadero Center San Francisco, CA 94111-4067 Telephone: (415) 393-2000 Facsimile: (415) 393-2286 donn.pickett@bingham.com geoff.howard@bingham.com holly.house@bingham.com zachary.alinder@bingham.com bree.hann@bingham.com DORIAN DALEY (SBN 129049) JENNIFER GLOSS (SBN 154227) 500 Oracle Parkway, M/S 5op7 Redwood City, CA 94070 Telephone: (650) 506-4846 Facsimile: (650) 506-7114 dorian.daley@oracle.com jennifer.gloss@oracle.com Attorneys for Plaintiffs Oracle USA, Inc., Oracle International Corp., Oracle EMEA Ltd., and Siebel Systems, Inc. UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA OAKLAND DIVISION ORACLE USA, INC., et al., v. Plaintiffs, CASE NO. 07-CV-01658 PJH (EDL) DECLARATION OF LARRY ELLISON IN SUPPORT OF ORACLE'S OPPOSITION TO DEFENDANTS' MOTION FOR PARTIAL SUMMARY JUDGMENT REGARDING PLAINTIFFS' HYPOTHETICAL LICENSE DAMAGES CLAIM [REDACTED] Date: October 28, 2008 Time: 9:00 a.m. Courtroom: TBD Judge: Hon. Phyllis J. Hamilton SAP AG, et al., Defendants. Case No. 07-CV-1658 (PJH) DECLARATION OF LARRY ELLISON A/73151891.1/2021039-0000324170 Dockets.Justia.com Case4:07-cv-01658-PJH Document484 Filed09/23/09 Page2 of 4 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 I, Lawrence J. Ellison, declare as follows: 1. I am the Chief Executive Officer of Plaintiff Oracle USA, Inc. ("Oracle"). I have personal knowledge of the facts set forth in this declaration and would competently testify to them if called upon to do so. 2. I understand that for purposes of damages in this case, any retroactive "hypothetical" license award can only cover the exact scope and duration of the infringement by Defendants. I do not have access to all highly confidential information in this case due to the Protective Order limitations, so I do not know the full nature, scope, terms and duration of Defendants' actual use of Oracle's intellectual property. I have not received any analysis regarding a retroactive license by Oracle's damages experts in this case and so have no details concerning the "hypothetical" license damages model and parameters. 3. During my May 5, 2009 deposition, Counsel for Defendants, Mr. Lanier, asked me a series of questions regarding a hypothetical license negotiation between Oracle and SAP/TomorrowNow that would have occurred in January 2005. Mr. Lanier did not ask me to assume any limitations on that license. I assumed that the hypothetical license that he referred to would have been for SAP not just TomorrowNow to take all of Oracle's intellectual property and between 70 and 100% of Oracle's share of the business software applications market. That is why I testified at the time: "So the thought process is, we're moving all of our IP. They've got a license to the PeopleSoft/JD Edwards IP. All of it." And, that is why I testified that my understanding of such a license meant that Oracle "would have been saying good-bye to the applications business forever." Even under those extreme circumstances, as I stated at my deposition, "we would still discuss the license" with SAP to see if it would make business sense. 4. Limitations on the nature, scope, terms and duration of the licensing proposal including the specific Oracle software to be licensed, to whom, for what uses, and for how long would be critical information for me to attempt to estimate the terms and cost of any such license. At my deposition, I either was not provided with any factual limitations on the proposed license to consider in providing my testimony about the possibility and price of the license. The factual assumptions I made based on the broad questions asked were in fact 1 Case No. 07-CV-1658 (PJH) DECLARATION OF LARRY ELLISON Case4:07-cv-01658-PJH Document484 Filed09/23/09 Page3 of 4 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 different from what I understand to be the necessary inquiry in determining a hypothetical license value, which is to focus on the actual use by SAP's subsidiary, TomorrowNow, for a finite time period, of certain specified Oracle intellectual property, with specific results in the marketplace. For example, Mr. Lanier did not ask me to assume any limit on the time period of the proposed license that would match the time period that TomorrowNow actually operated as part of SAP. He did not ask me about a simultaneous license for TomorrowNow's operations relating to Oracle's database software. Mr. Lanier also did not explain or ask me to assume that the license would involve limited use and access by TomorrowNow alone, and would have not allowed SAP or TomorrowNow to openly market their access to and use of Oracle's intellectual property as part of a competitive service offering. My responses during my deposition would have been different if any or all of these factual limitations had been explained. (I do not intend to say that the illustrative list of limiting facts above is comprehensive, but they illustrate how different factual scenarios would affect how I would consider the final license terms in a negotiation.) In particular, taking into account the types of factual differences described above, I would not have assumed that Oracle's license to SAP would have resulted in Oracle selling all of its intellectual property and 70 to 100% of its share of the business applications software market to SAP. Though my estimation of the fair market value of a more limited license would still be considerable, it would have been significantly lower than my estimation during my deposition based on selling Oracle's entire share of the business applications software market to SAP. 5. When presented with the final parameters of licenses for the actual infringement by Defendants of Oracle's copyrighted materials from Oracle's damages experts, I will analyze those parameters rigorously before opining on what I believe the fair value would be. Among the things I would consider are exactly what intellectual property was being licensed, to whom, how it was used, SAP/TomorrowNow access to the software, the limitations on SAP's ability to communicate to customers about the license, Oracle's expected profit from using the software in the absence of any such licenses, what Oracle expected to lose in business from granting such a license, how much Oracle had spent developing or acquiring the material to be licensed, how much time and cost Defendants could avoid by licensing the material when they 2 Case No. 07-CV-1658 (PJH) DECLARATION OF LARRY ELLISON Case4:07-cv-01658-PJH Document484 Filed09/23/09 Page4 of 4

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