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Oracle owes HP $3 billion in damages for breach of contract, jury says

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Oracle must pay HP $3 billion in damages, a California jury has ordered, for breaching a contract relating to HP's servers. HP says Oracle broke an agreement to keep developing software for servers based on Intel's Itanium chips, while Oracle had argued that Intel made it clear in 2011 that the chip type was on its way to obsolesce, and that it didn't have a contract to keep developing the software forever.

A judge decided there was a contract in 2012

The jury's order comes four years after judge James Kleinberg originally ruled that the two companies did indeed have a contract in place. "HP is gratified by the jury's verdict, which affirms what HP has always known and the evidence overwhelmingly showed," HP executive vice president John Schultz said to Reuters, calling Oracle's halting of Itanium software development "a clear breach of contract." Oracle says it will appeal both Kleinberg's ruling that the agreement was a contract, and the jury's decision on damages.

Oracle and HP have a tumultuous history. In 2010, Oracle CEO Larry Ellison said it would be "virtually impossible" for the two companies to work together in the future after HP sued its former CEO Mark Hurd for taking a position as Oracle's co-president. Those wounds apparently healed enough for the companies to cooperate soon after, but today's ruling might sow yet more seeds of distrust.