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The Oracle

Geoff Howard orchestrates Oracle’s landmark case against fellow tech giant SAP

Published in 2013 Northern California Super Lawyers magazine

By Larry Rosen on July 8, 2013


Geoff Howard’s watershed moment was like something out of The Graduate, except it was his father speaking—not a friend of the family—and Howard actually took the advice. In fact, he built a career out of it.

“My dad sat me down when I was a [high school] sophomore,” recalls the technology-focused Bingham McCutchen litigator. Dr. Matthew Howard placed a Kaypro II personal computer in front of his adolescent son and told him to listen closely: “You ought to learn this. This is the wave of the future.”

Howard spent the following summer at his father’s office, and in 1988, the elder Howard signed his son up for CompuServe so the first-year law student could send emails to his family. “He introduced me to the Internet,” Howard says. “I’m not a handy guy like him, but his curiosity about how things work and his passion for technical exploration definitely rubbed off on me.

“I’ve always been very curious about technology. Even though I don’t have a tech background, it’s something I’ve always sought out.”

Now technology seeks him out.

On Nov. 23, 2010, a jury ruled in favor of his client, Oracle Corp., against fellow tech giant SAP AG. The $1.3 billion judgment set a record for a copyright infringement case.

Of course, in many ways that trial was just the beginning.

In high school, Howard played on the basketball and tennis teams and ran track, spending hours honing his skills. His fastest 800-meter time, 1:56.14, still ranks among the all-time best for his high school region. Undergraduate years at UCLA were followed by law school at Harvard, where his father, the first full-time ear, nose and throat specialist in Ukiah, visited his son, sat in on some classes and caught law fever. Upon his return, Dr. Howard applied to U.C. Berkeley School of Law’s Boalt Hall, earning a J.D. and embarking on a second career practicing Social Security disability law.

When Howard’s father retired from his two careers, he and Howard’s mom took a trip through Alaska and across Canada. “They each brought their laptops,” their son says with a chuckle, “and blogged their entire trip.”

By then, the younger Howard was well into a successful career as a litigator at Bingham McCutchen, and his interest in technology had made him a key player in the fields of intellectual property and technology law. Twenty-one years after joining the firm, he’s still there, doing the mentoring where he was once mentored.

Early in his career, Howard worked in construction law but found ways to feed his appetite for technology. “If you’re a tech nut like I am, you can really have a lot of fun with the technology that’s employed in large construction projects,” he says.

Eventually, he gravitated toward intellectual property and technology law, the twin obsessions of his home base, the San Francisco Bay Area. He loved being part of the Zeitgeist, having a front-row seat in one of the biggest cultural revolutions in history. He loved the learning opportunities and how fast the tech world moved. “[The Internet] created a snowballing effect for us lawyers to keep up,” he says.

Over time, Howard began to feel protective of technology’s open-ended relationship with innovation; to him, his job was to make it easy—and profitable—for inventors to invent.

“We live in one of the world’s tech centers,” he says, “but these companies can only exist today, only employ the thousands of people they employ, only make the contributions to the economy they make, because their innovations are rewarded.

“If you thought the investment you were putting into innovation could be taken from you for no compensation, then what [would be] the incentives to innovate?”

This question would be at the crux of the biggest case of Howard’s two decade-plus career: Oracle v. SAP AG. It landed on his desk in 2007.

The timing wasn’t great. Howard had just been named managing partner of Bingham McCutchen’s San Francisco office. He had young children at home. He was just wrapping up another large case, representing Qualcomm Inc. in a successful patent-infringement case against Broadcom Corp.

Howard had worked extensively with Oracle in the past, so the new assignment made sense. Filed March 22, 2007, the suit accused SAP and its now-defunct subsidiary, TomorrowNow, a third-party technical support company, of downloading Oracle software and copying Oracle applications by using customer IDs and passwords, in order to offer technical support to Oracle licensees and to get customers to buy SAP’s products. “It was a computer-fraud case,” Howard says. “All we knew was that there was massive downloading.”

SAP, a German company whose scale almost matched that of Oracle, had purchased TomorrowNow in 2005. After Oracle filed an amended complaint, Howard says, SAP publicly admitted that TomorrowNow was involved in copying software. Whether that was acceptable—SAP at first said it was part and parcel of providing third-party customer support—and whether it occurred with SAP’s knowledge and tacit approval, were other matters.

The massive case was tried by a combined team of Bingham and in-house Oracle lawyers as well as co-counsel from Boies, Schiller & Flexner—including legendary litigator David Boies, of United States v. Microsoft fame.

As for Howard, his co-workers paint a picture of him as a sort of latter-day Atticus Finch: dedicated, inspirational, loyal to his team and his client. In person, the trim, buzz-cut Howard looks every inch the former track star. He is soft-spoken and deflects attention whenever possible. Discussing Oracle v. SAP, he doesn’t use the term “I.” Instead, he lauds Bingham McCutchen’s “deep, talented team.”

“I’m part of that [team], but everyone contributed equally,” he says.

His colleagues at the firm give him more credit:

“Geoff was the leader from day one,” says Bree Hann. “He drove the strategy.”

Donn Pickett concurs. “Geoff was the unquestioned leader,” he says. “Understand, you’re dealing with a small army of lawyers. They need direction, guidance and assignments to make sure everything gets done. Geoff played that role very well.”

Howard says, “Our primary damages theory at trial revolved around what some people call a ‘hypothetical license,’ [which] involves what the party’s expectations were at the time of infringement.” Oracle argued that it should receive damages based on the licensing fees SAP would have paid to use Oracle’s software legally.

Howard’s team also argued that Oracle had lost many potential customers.

Early in the case, SAP said it had no prior knowledge of illegal actions by TomorrowNow. But Oracle believed SAP had purchased TomorrowNow with eyes wide open.

As the Oracle team leafed through reams of evidence, it came across documentation that Howard says showed that SAP had acquired TomorrowNow knowing a large part of the smaller company’s reason for being was to copy software from Oracle.

Finding this, he says, became the team’s “aha” moment: the turning point upon which its case was made.

“There aren’t many Perry Mason moments in the course of discovery,” Howard says, “but when you discover something like that, it’s significant.”

“I had to take a deep breath,” says Hann. “It was an ‘oh, wow’ moment.”

“You have to understand,” Howard says with six years of hindsight, “nothing like this had ever happened.”

After this new development, SAP admitted contributory liability for TomorrowNow’s sins. As a result, the trial was limited to copyright infringement, with a jury determining the damages, which SAP had calculated as being somewhere between $28 million and $408.7 million. The jury disagreed, accepting Oracle’s argument regarding “hypothetical licenses.”

The 11-day trial was the talk of Silicon Valley. CNNMoney said it had “all the makings of an industrial espionage flick.” Then, in July 2011, SAP motioned to have the award tossed out, claiming it should not have been based on hypothetical licenses. U.S. District Court Judge Phyllis Hamilton agreed. On Sept. 1 that year, she threw out the jury verdict, saying that hypothetical licenses—and losses—had no basis in law.

“We were very surprised when Judge Hamilton vacated the jury award,” Howard says. “We thought the jury got it right; that there was unusually strong evidence to support the award.”

Howard immediately rallied his troops for the next phase. Hann says it was Howard’s unwavering belief in Oracle’s case that prevented a single member of his team from jumping ship after Judge Hamilton’s decision. “He had a real faith that we were right,” she remembers. “It was like, ‘Okay, now let’s saddle up.’”

Oracle’s consolation prize was the judge’s offer of a $272 million damages award. But Oracle rejected the judge’s offer, first requesting a new trial, then opting to appeal Judge Hamilton’s reduction of the damages. In August 2012, in an effort to bring the issue to a close in lieu of a second trial, the companies stipulated to a judgment in which SAP would pay Oracle $306 million, in addition to $120 million it had already ponied up for Oracle’s legal fees. So whatever the outcome of the appeal, Oracle will end up with at least $426 million. But Howard is hoping the 9th Circuit will reinstate the jury verdict.

“The rules [of conduct] between competitors are very important,” Howard says. “That’s what [Oracle v. SAP] is largely about. There’s probably nothing more important than seeing that these rules are applied in the right way to protect innovation.

“This case goes beyond Oracle’s individual harm. There’s an industry at stake.”

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