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Jury verdict: Oracle must pay $3 billion in damages to HP

Texas business owners may be interested in learning that Oracle has been ordered to pay Hewlett-Packard $3 billion in a breach of contract action. The verdict was handed down by a jury in Santa Clary County, California, on June 30. An Oracle spokesperson indicated that the company will appeal the decision.

The contract breach concerned an agreement between Hewlett-Packard and Oracle through which Oracle would maintain Hewlett-Packard's Itanium-based servers. The Itanium chips are made by Intel, another California company. Oracle stopped developing software for the servers in 2011 and claimed that Hewlett-Packard had indicated it was moving away from Itanium chips in favor of its x86 processors.

In 2012, a judge found that a contract between the companies had existed. The jury handed down its verdict in the damages phase of the trial. Oracle said it is appealing both the judge's initial 2012 ruling as well as the verdict. A spokesperson for Oracle said that the company has provided software since the 2012 ruling for the Itanium servers. Hewlett-Packard had stated that the lack of software made the servers obsolete.

Contract disputes sometimes arise in the course of doing business. When the alleged breaches are so severe that they destroy the heart of the contract, it may be necessary to litigate them fully in order to recover damages that fairly compensate the party that was harmed by the breach. In other cases, attorneys who have experience with these types of matters may be able to negotiate settlements for their clients with the breaching party so both parties can move forward.

Source: NBC News, "Oracle to pay $3B for Hewlett-Packard contract breach," July 1, 2016.

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