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Oracle demands 'billions' in damages from Google
2011-06-17 Article Rating:  / 0
Oracle disclosed that it's asking for damages running in the billions of dollars in its patent lawsuit against Google regarding the use of Java patents in Android. The damage figure is based in part on Oracle's estimation that Google makes $3.35 a year per Android device via mobile ads.
Google could rue the day it built the Android operating system with Java code and spun it out to the world under an open source license. Oracle, which sued the search giant for patent and copyright infringement last August, is seeking damages "in the billions of dollars," according to Reuters. This stunning revelation came one week after we learned that Oracle is asking for 50 percent of Google's mobile ad sales. Yet, this is the first time we've heard officially from Oracle how much in damages the company is seeking. Even so, patent expert Florian Mueller called it when he wrote June 15 that Oracle was seeking at least a billion dollars from Google: "Having analyzed Google's latest filings in the case, I have no more doubt that Oracle's damages expert calculated damages that would, at least, if tripled due to willful infringement, amount to a billion-dollar figure." In addition, Google could also face an injunction and be forced to negotiate a license deal, according to Mueller. "In the alternative, all existing Dalvik-based apps would have to be ported to a new app platform," he added. Google doesn't make money directly from Android because it doesn't license the technology. Rather, it makes money from ads related to mobile searches performed on those 100 million-plus devices people use all over the world. Clearly, Android's ubiquity is a big part of Oracle's seemingly greedy position. $3.35 a year per Android device Oracle estimated that Google earns $3.35 a year per device via mobile ads, so if you multiply that number by 100 million, you get $335 million, half of which amounts to more than $165 million. Then you add $200 million for lost profits, and the figure could move into the billions for Google's alleged fragmentation of Java into "numerous incompatible sub-standards," according to Oracle's legal verbiage. Google is, of course, asking the U.S. District Court in Northern California to dismiss the damage report. Meanwhile, the court could conceivably award Oracle triple damages, in the event it finds Google willfully triggered all the damages. eWEEK asked Mueller what Google is looking at it in payouts if the infringement is found to be non-willful versus willful. Mueller, who has updated his coverage of the case to address Oracle's "billions" claim, replied that based on Oracle's latest filing, it looks like the amount will be in the billions of dollars even independently of the willful infringement question. If the court determines there was willful infringement, then the question is when it began. That could be the time when the infringement as a whole began, but it could also be a later point in time, such as when Google was put on notice. (That is, if notice was needed at all -- maybe it's clear they knew it even without notice.) The tripling of damages would then relate to that period, but not to the period before. This could end up being the biggest business-altering, multi-billion-dollar mistake Google ever made in its 13 years of existence. Google makes $30 billion a year, give or take. It doesn't want to end up paying billions back, never mind pay Oracle for Android licensing in perpetuity.
But it may have to if it loses in court.
Clint Boulton is a writer for eWEEK's Google Watch blog.
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