No Split Decision On Oracle

JP Morgan has published a research report on Oracle Corporation (NASDAQ: ORCL) after an Oakland, California jury awarded the company $1.3B in damages in a copyright-infringement case with SAP's TomorrowNow business.

In the report, JP Morgan writes "SAP (rated Overweight by JPM European Software and IT Services Analyst Stacy Pollard) purchased TomorrowNow, a provider of third-party maintenance to package application software, in 2005. Oracle sued SAP on the basis that TomorrowNow made hundreds of thousands of illegal downloads and several thousand copies of Oracle's software to avoid paying licensing fees and to steal customers. SAP did not contest that it was liable for the infringement but did underestimate the value of the damages at up to $40M versus Oracle's estimate of $1.65bn. If paid out, this will be the largest award for a copyright-infringement case. We estimate that the $1.3bn will translate into a one-time nonoperational benefit of $0.26 to GAAP EPS, assuming no tax effects."

JP Morgan maintains its Overweight rating on Oracle Corporation, which closed yesterday at $27.19.