Ellison Tells HP Jury Itanium Retreat Was Just Business

  • Oracle co-founder denies mischief behind 2011 press release
  • HP seeks $3 billion in damages over abandoned software support

Larry Ellison.

Photographer: Kiyoshi Ota/Bloomberg

Oracle Corp. Chairman Larry Ellison told a jury he wasn’t trying to drop a bomb on Hewlett-Packard Co. shareholders when he announced an end to a partnership five years ago.

Hewlett-Packard is seeking $3 billion in damages over claims Oracle bailed out of a pact to develop software using the once-promising Itanium chip.

Ellison denied that he meant Hewlett-Packard harm in 2011 when he issued a press release, just ahead of that company’s shareholder meeting, announcing Oracle would no longer support Itanium, which had been created by Intel Corp.

“It’s just not true,” Ellison testified Wednesday. “It was a business decision to stop investing in Itanium because the maker of the chip, Intel, had stopped investing in Itanium.”

The trial, now its fourth week, is a continuation of a battle that played out four years ago in the same state court in San Jose, California.

2012 Trial

In 2012, a judge ruled that Oracle was contractually obligated to continue developing software for Itanium. The current jury must decide whether both companies have complied with their agreement.

Hewlett-Packard claims that after Oracle abandoned a commitment to support servers running the Itanium chips, the product floundered.

Oracle has argued that chip-makers including Intel and International Business Machines Corp. had produced superior products to Itanium and there was no point in continuing to support it.

“Even though HP has all of the Oracle software, they are now asking for an extra $3 billion dollars because of a press release that told the truth, that Intel was getting out of Itanium,” Oracle spokeswoman Deborah Hellinger said in an e-mailed statement. “But technology doesn’t die because of a press release, it dies because better technology leaves it behind.”

Hewlett-Packard contends Itanium was humming along when Oracle pulled out of the partnership.

‘Long Life’

“The record in the trial, including statements under oath by Intel executives, clearly show that Itanium was not at or near the end of its life, in fact it had a long life ahead and innovation was occurring to make it a better prospect,” said Mark Ferguson, a lawyer for Hewlett-Packard.

Jurors heard earlier from Oracle Co-Chief Executive Officer Mark Hurd, whose defection from Hewlett-Packard, where he was CEO for more than five years until August 2010, sparked turmoil between the tech giants. Hewlett-Packard’s attorney questioned Hurd about his role in Oracle’s decision to mothball Itanium services after his arrival.

When asked what information he shared with Oracle after his departure from Hewlett-Packard, he replied, “none.”

Hewlett-Packard split in November into Hewlett Packard Enterprise Co. and HP Inc.

The case is Hewlett-Packard Co. v. Oracle Corp., 11-cv-203163, California Superior Court, Santa Clara County (San Jose).

(An earlier version of this story corrected Mark Hurd’s tenure at Hewlett-Packard.)

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