"Oracle Corporation and its subsidiaries, including Plaintiffs Oracle International Corporation and Oracle America, Inc., are notorious around the globe for their predatory audit practices. Essentially, Oracle and its related entities utilize the limited audit rights granted to them under their software license agreements as a tool to improperly drive further sales of Oracle software products."
Tactical Law Group LLP Motion to Dismiss Oracle Complaint for Copyright Infringement and Breach of License Agreement
| 2016-10-13_018_fulmer_wares_motion_to_dismiss_oracle_complaint[5].pdf |
Our Experience
Has your company been the victim of a predatory software audit by Oracle or another enterprise software publisher? Have you been subjected to Oracle's infamous "Audit, Bargain, Close" ("ABC") audit tactics? Has a software publisher threatened to terminate your license or actually terminated your license based on disputed findings in a software audit? We have advised companies of all sizes, as well as governmental entities including municipalities, universities and non-profit organizations how to save on licensing fees and resolve software audits conducted by aggressive software publishers. We have also developed successful strategies to push back on threats of license termination or actual terminations and resolve the dispute most often without the necessity of litigation. Although software publishers such as Oracle, Micro Focus and Quest are often in the news for filing litigation against their customers stemming out of super aggressive software audits, other publishers including IBM, SAP, Microsoft, Adobe, Autodesk, Cisco and others are also very active in the audit space. Enterprise software customers must be prepared for the inevitable audit, and be ready to fight back against overreaching and baseless software audit findings. Tactical Law attorneys have successfully resolved audits involving multiple software publishers and understand the typical issues that often arise, and have developed strategies to successfully resolve audit related licensing disputes.
Oracle Software Audit Defense
We have deep experience with Oracle audits. Oracle customers have seen the Oracle audit playbook. Has Oracle tried to collect licensing fees for your entire VMware farm even though no Oracle software is installed on many of the servers? Has Oracle or another software publisher insisted on imposing its non-contractual "policies" on your business rather than looking to the binding contract? Are you an Oracle Partner, where Oracle claims you have utilized the incorrect Oracle license type, such as an embedded license, and is threatening to terminate your Oracle license unless you pay Oracle exorbitant licensing fees? Has Oracle reached out to you about how you are licensing Java? Are you an Amazon AWS RDS customer who licenses Oracle software and has been contacted by Oracle about a claimed compliance gap? If so, we can help.
When we are first retained many of our clients are shell shocked about how they have been treated by Oracle during a software audit. It is no wonder as former Oracle executives have confirmed in federal court filings how Oracle uses predatory audits to boost sales of its cloud and other software. Here is how one former Oracle employee (known as Former Employee ("FE") 1 in the Sunrise Firefighter's Class Action Complaint described the way Oracle uses software audits to drive sales of enterprise software:
Former Employee ("FE") 1 "confirmed that the sales teams and LMS [Oracle's internal audit arm] closely coordinated to use audits in order to sell unwanted cloud subscriptions. FE 1 also stated that sales would direct LMS to target clients for audit. In particular, FE 1 stated that the sales team would “identify large clients they thought they could get more money out of and threaten them with audits,” instructing LMS to say the Company had suspicions that they were out of compliance. Indeed, FE 1 stated that the sales teams would actually write out the threatening audit letters and give them to LMS to then send to the client. FE 1 stated that frequently, neither sales nor LMS had real evidence that customers targeted for audits were noncompliant, but that the mere threat of an audit would put the customers under so much pressure, because of the enormity of the potential penalties, that customers had no choice but to agree to Oracle’s demands that the client purchase cloud products. FE 1 stated that once the cloud sale was complete, the sales team would tell LMS that the customer had trued up, and LMS would close the file without even following-up with the client (making clear that the audit was initiated as a mere pretext to push the cloud sale through). FE 1 stated that “any statements from Oracle that LMS was independent from sales are a lie.”
Other allegations in the Complaint are also instructive. For example, "[t]o start, Oracle installed its main on-premises products with extra options and management packs enabled by default, but did not inform its customers that these features had been installed and must be disabled in order to avoid license overages. Once a customer fell into this trap, Oracle’s sales and LMS teams worked in a highly coordinated fashion to audit the client for its license violations and push cloud products."
Tactical Law Group LLP has successfully pushed back on these and similar tactics saving our clients hundreds of millions of dollars in licensing fees. We understand the Oracle audit playbook and use our familiarity with Oracle's audit practices to identify baseless audit findings and areas of overreach. This includes combatting audit findings where Oracle attempts to use non-contractual policy documents to inflate the alleged compliance gap. One such overreach that we commonly see is Oracle's attempted utilization of its non-contractual partitioning policy to inflate VMware virtualization related non-compliance assertions.
Our firm advises clients on a myriad of issues involving the defense of software audits involving other software publishers as well. We have defended such audits on behalf of a number of clients and have particular expertise with defending audits brought by Oracle. Often these audits involve advising on issues relating to hosting, the cloud, facilities or other restrictions in license agreements, or VMware virtualization technology. Tactical Law Group is also a thought leader on the topic of software audits, publishing articles in addition to the firm's blog. For example, read a article on page 4 of the Northern California Oracle Users Group Journal discussing Licensing Oracle Software in Cloud Environments.
Pam was a partner at Arent Fox LLP in the San Francisco office, when the Mars v. Oracle lawsuit was filed in San Francisco Superior Court. Tactical Law Group also defended telecommunications company Cogent Communications, in a lawsuit brought by Oracle in federal court in San Francisco alleging copyright infringement and breach of software license agreement arising out of an Oracle software audit.
With regard to Oracle licensing in particular, our firm understands and has experience with the relevant California contract law, and we are able to offer our clients economical and pragmatic advise to resolve their Oracle related licensing issues. Also with regard to Oracle, our attorneys have years of experience litigating cases in state and federal courts in the San Francisco Bay Area, which is typically the venue mandated for dispute resolution by Oracle license agreements.
If you are an Oracle or other enterprise software customer and have received an audit notification letter or you have received audit findings claiming a large licensing compliance gap, our attorneys are here to help. Please contact us for a free case evaluation.
Has your company been the victim of a predatory software audit by Oracle or another enterprise software publisher? Have you been subjected to Oracle's infamous "Audit, Bargain, Close" ("ABC") audit tactics? Has a software publisher threatened to terminate your license or actually terminated your license based on disputed findings in a software audit? We have advised companies of all sizes, as well as governmental entities including municipalities, universities and non-profit organizations how to save on licensing fees and resolve software audits conducted by aggressive software publishers. We have also developed successful strategies to push back on threats of license termination or actual terminations and resolve the dispute most often without the necessity of litigation. Although software publishers such as Oracle, Micro Focus and Quest are often in the news for filing litigation against their customers stemming out of super aggressive software audits, other publishers including IBM, SAP, Microsoft, Adobe, Autodesk, Cisco and others are also very active in the audit space. Enterprise software customers must be prepared for the inevitable audit, and be ready to fight back against overreaching and baseless software audit findings. Tactical Law attorneys have successfully resolved audits involving multiple software publishers and understand the typical issues that often arise, and have developed strategies to successfully resolve audit related licensing disputes.
Oracle Software Audit Defense
We have deep experience with Oracle audits. Oracle customers have seen the Oracle audit playbook. Has Oracle tried to collect licensing fees for your entire VMware farm even though no Oracle software is installed on many of the servers? Has Oracle or another software publisher insisted on imposing its non-contractual "policies" on your business rather than looking to the binding contract? Are you an Oracle Partner, where Oracle claims you have utilized the incorrect Oracle license type, such as an embedded license, and is threatening to terminate your Oracle license unless you pay Oracle exorbitant licensing fees? Has Oracle reached out to you about how you are licensing Java? Are you an Amazon AWS RDS customer who licenses Oracle software and has been contacted by Oracle about a claimed compliance gap? If so, we can help.
When we are first retained many of our clients are shell shocked about how they have been treated by Oracle during a software audit. It is no wonder as former Oracle executives have confirmed in federal court filings how Oracle uses predatory audits to boost sales of its cloud and other software. Here is how one former Oracle employee (known as Former Employee ("FE") 1 in the Sunrise Firefighter's Class Action Complaint described the way Oracle uses software audits to drive sales of enterprise software:
Former Employee ("FE") 1 "confirmed that the sales teams and LMS [Oracle's internal audit arm] closely coordinated to use audits in order to sell unwanted cloud subscriptions. FE 1 also stated that sales would direct LMS to target clients for audit. In particular, FE 1 stated that the sales team would “identify large clients they thought they could get more money out of and threaten them with audits,” instructing LMS to say the Company had suspicions that they were out of compliance. Indeed, FE 1 stated that the sales teams would actually write out the threatening audit letters and give them to LMS to then send to the client. FE 1 stated that frequently, neither sales nor LMS had real evidence that customers targeted for audits were noncompliant, but that the mere threat of an audit would put the customers under so much pressure, because of the enormity of the potential penalties, that customers had no choice but to agree to Oracle’s demands that the client purchase cloud products. FE 1 stated that once the cloud sale was complete, the sales team would tell LMS that the customer had trued up, and LMS would close the file without even following-up with the client (making clear that the audit was initiated as a mere pretext to push the cloud sale through). FE 1 stated that “any statements from Oracle that LMS was independent from sales are a lie.”
Other allegations in the Complaint are also instructive. For example, "[t]o start, Oracle installed its main on-premises products with extra options and management packs enabled by default, but did not inform its customers that these features had been installed and must be disabled in order to avoid license overages. Once a customer fell into this trap, Oracle’s sales and LMS teams worked in a highly coordinated fashion to audit the client for its license violations and push cloud products."
Tactical Law Group LLP has successfully pushed back on these and similar tactics saving our clients hundreds of millions of dollars in licensing fees. We understand the Oracle audit playbook and use our familiarity with Oracle's audit practices to identify baseless audit findings and areas of overreach. This includes combatting audit findings where Oracle attempts to use non-contractual policy documents to inflate the alleged compliance gap. One such overreach that we commonly see is Oracle's attempted utilization of its non-contractual partitioning policy to inflate VMware virtualization related non-compliance assertions.
Our firm advises clients on a myriad of issues involving the defense of software audits involving other software publishers as well. We have defended such audits on behalf of a number of clients and have particular expertise with defending audits brought by Oracle. Often these audits involve advising on issues relating to hosting, the cloud, facilities or other restrictions in license agreements, or VMware virtualization technology. Tactical Law Group is also a thought leader on the topic of software audits, publishing articles in addition to the firm's blog. For example, read a article on page 4 of the Northern California Oracle Users Group Journal discussing Licensing Oracle Software in Cloud Environments.
Pam was a partner at Arent Fox LLP in the San Francisco office, when the Mars v. Oracle lawsuit was filed in San Francisco Superior Court. Tactical Law Group also defended telecommunications company Cogent Communications, in a lawsuit brought by Oracle in federal court in San Francisco alleging copyright infringement and breach of software license agreement arising out of an Oracle software audit.
With regard to Oracle licensing in particular, our firm understands and has experience with the relevant California contract law, and we are able to offer our clients economical and pragmatic advise to resolve their Oracle related licensing issues. Also with regard to Oracle, our attorneys have years of experience litigating cases in state and federal courts in the San Francisco Bay Area, which is typically the venue mandated for dispute resolution by Oracle license agreements.
If you are an Oracle or other enterprise software customer and have received an audit notification letter or you have received audit findings claiming a large licensing compliance gap, our attorneys are here to help. Please contact us for a free case evaluation.
|
| ||
BlogFollow our blog for updates relating to relevant issues involving California contract and federal copyright law and how they may impact your software audit defense.
|
Subscribe |
