The Next Silicon Valley Battle: Oracle and Google

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I went to see a fight the other day when a hockey game broke out. The way lawsuits are flying in Silicon Valley, that wordplay could be used on tech stocks as well.

In the Android lawsuit issued by Oracle (Nasdaq: ORCL  ) against Google (Nasdaq: GOOG  ) , the typical war of words has turned both nasty and sneaky.

Oracle wants Google to pay "billions of dollars" in damages for the way it allegedly misused Java code to develop the Android platform. Ho-hum -- happens all the time. The database master made similarly outrageous claims in a recent tussle with rival SAP (NYSE: SAP  ) -- and got a $1.3 billion decision. SAP had set aside just $160 million to pay for the damages, which it reckoned in the "tens of millions." So there's a fresh precedent for massive damages here, at least in Oracle's mind.

Here's where it gets creepy.

Google filed a court document to strike Oracle's estimate of damages from the record, on the grounds that the hired expert's "legal errors are fundamental and disqualifying, and allowing him to testify about his conclusions to a jury would prejudice Google."

But the filing itself is full of blacked-out text in the public record and is marked this way: "Contains Confidential and Highly Confidential -- Attorneys' Eyes Only Information." The stricken portions appear to discuss exactly how much money Oracle is asking for, as well as the methodologies used to arrive at that estimate.

So Oracle shot back in a very non-redacted filing of its own, clearly showing that Google had censored "[a]ny and all references to the fact that Oracle's damages claims in this case are in the billions of dollars" along with isolated words such as "multi-billion" and "valueless."

Putting a damper on Android through court injunctions or enormous fees would have massive effects on the mobile market. Not only is Google's future at stake, but handset partners from Motorola Mobility (NYSE: MMI  ) to Samsung have a lot of poker chips in this hand, too. The companies that stand to gain from a short-circuited Android are also many, but Microsoft (Nasdaq: MSFT  ) must be watching this battle with a little bit of extra glee; that license-free model could never fly in Redmond, you know.

A lawsuit of this magnitude clearly deserves a bit of drama, and we're getting it aplenty. Google, the traditional champion of open information, comes off as secretive and sneaky, while Oracle gets to say, "We have nothing to hide!"

The way I read it is a bit different. It looks like Google was trying to abide by Oracle's own confidentiality requests and simply struck a bit more than necessary from the record -- an error Oracle is all too happy to point out. Then again, I'm a Google shareholder and perhaps a little biased. Moreover, I'm no lawyer.

Perhaps you know better or have a bar degree to back up your opinions. In that case, you can read Google's filing here and Oracle's over there, and then come back to explain what's really going on. The comments box is waiting below with bated breath.

Fool contributor Anders Bylund owns shares of Google, but he holds no other position in any company mentioned. Click here to see his holdings and a short bio. The Motley Fool owns shares of Google, Oracle, and Microsoft. Motley Fool newsletter services have recommended buying shares of Microsoft and Google, as well as creating a diagonal call position in Microsoft. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Read/Post Comments (3) | Recommend This Article (2)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On June 17, 2011, at 3:32 PM, md812 wrote:

    anyone who has been to google, knows friends at google knows how militarily secretive they are. all the bit about openness is BS and orthogonal to reality. they are about as opposite to open source as you can get. I don't blame them for wanting to zealously guard their IP, but I do blame them for the deceitful PR that claims otherwise.

  • Report this Comment On June 17, 2011, at 10:53 PM, swapsan wrote:

    Java is open source and it's reputation, wide acceptance is based on the fact it is open source. Oracle's claim is Java ME (mobile Edition not SE and EE editions) is open source but comes with restrictions i.e any Java compiled byte code must comply with JVM specifications. JVM (Java Virtual Machine) then interprets the compiled java byte code. But Android only uses Java "syntax". The code is actually compiled to be interpreted by Davlik Virtual machine which has nothing to do with Java. It is fairly common place to use syntax of one language and compile and interpret it according to another. The core of a language is compiler and interpreter not it's outer syntax.

    Without Android and Google, Apple would have swallowed the smart phone market. What has Oracle really done in the mobile space to start claiming a slice of the pie ? Google itself hasn't made any money out of Android. Without it's investments the smartphone market would have been a monopoly left to Apple. This looks like a case of sheer opportunism by arguing on finer technicalities.

  • Report this Comment On December 12, 2013, at 3:28 AM, THUFIRH wrote:

    err, kinda. the Java language is open sourced under the GPL through OpenJDK. Also, javac, and probably some other stuff is open sourced.

    Java ME is a strange beast because it's not Java SE. It's a subset of Java SE, yes, but then each vendor who licenses Java ME have their own proprietary API's -- so it more intersects with Java SE than anything else.

    You can easily take OpenJDK, again, open sourced, and fork it into something almost exactly like JavaME -- and that's fine.

    The fine print, though, is that there's an exception to the TCK for Java for OpenJDK. The exception says that OpenJDK, or anything forked from it and staying much the same, can pass the TCK and therefore get the Java name on it.

    However, if you stray far enough, towards JavaME, then probably Oracle wouldn't let you call it Java.

    However, you could call it whatever you wanted to! It's open source. You just couldn't call it Java.

    Google knows all this but chose to go another way, to find what they say is a work-around to the GPL, for all intents and purposes.

    It's reminiscent of what Android did with Linux header files -- they just stripped out the copyright notices and dared anyone to sue them. No one at, apparently, cares enough to roll the dice :(

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