One myth that pops up in our industry is whether third-party support is legal. But where did this myth come from? In this post, we cover the story so far of Rimini Street vs Oracle (the lawsuit that led to the lie). We also discuss what the results of the court trials mean today.
CEO Seth Ravin founded Rimini Street in 2005. It currently provides support services for Oracle, SAP, Microsoft, and other ERP applications.
Starting around 2006/2007, as part of its support model, Rimini Street was downloading software from Oracle’s website. It posed as the Oracle customer it was providing support for. This was its method of providing customers with configuration, maintenance, problem resolution, and other support services.
Naturally, Oracle wasn’t happy about this. Its complaint was:
But this wasn’t its only complaint. Oracle accused Rimini Street of the following:
Rimini Street was, in a manner of speaking, using Oracle’s software against it. The third-party support provider was using its downloads from Oracle’s website and bypassing the user terms. It did this to lure Oracle’s own customers away for a fraction of the cost.
Rimini Street’s practices led to Oracle filing suit against Rimini Street in January 2010.
The trial between Rimini Street and Oracle ran from September to October 2015. At the end of the trial, the results were as follows:
At the end of the 2015 trial, Rimini Street was issued with a permanent injunction, prohibiting “further illegal acts of copyright infringement and computer fraud.” Oracle’s basis for this was that it had taken Rimini Street to court on the grounds of copyright infringement. Therefore, the injunction would stop Rimini from doing it again.
Rimini cannot reproduce, distribute, or prepare derivative works from Oracle software, unless it meets specific conditions. These are as follows:
The end of the trial was certainly not the end of the story. It wasn’t the end of the legal battle between Rimini Street and Oracle either.
Rimini Street appealed on all charges, though less so on the charge of computer fraud. Its main concern was appealing the charges for copyright infringement. It was also trying to dismiss the injunction set against it, and challenging Oracle’s legal costs.
This was another lengthy legal battle. Both sides appealed and counter-appealed verdicts in different courts. A summary of the major results is below:
On 19 August 2019, Rimini Street released a press release:
Oracle’s claims of copyright infringement had fallen flat, bar one marked down as “innocent infringement.” Rimini Street made sure to reiterate that it had already dropped the infringing conducts (which had led to the whole lawsuit in the first place) in July 2014; before the 2015 trial had even happened.
Rimini Street appeared pleased with this latest ruling (despite it costing an estimated $90 million to get there).
Rimini Street’s press release also stated that it’s evaluating its options in reclaiming the $28.5 million Oracle won in legal fees in August 2018.
Rimini Street was ordered by the Court to ‘show cause why it should not be held in contempt for violating the Permanent Injunction in this action’.
A seven-day hearing commences to hear the response of Rimini Street and the counter-responses of Oracle.
Both parties then ‘filed proposed findings of fact and conclusions of law on October 19’.
The Court finds Rimini Street in contempt of the 2018 court ruling on five issues. Rimini Street are ordered to pay $630,000, plus Oracle’s legal costs. For a further five issues Oracle raised, the Court found no case to answer. (Source)
Oracle general counsel Dorina Daley commented, “Our rights have been vindicated once again, and the court recognises Rimini [Street] as a bad actor that violates federal law”. (Source)
In response Rimini Street stated, “Despite extensive discovery by Oracle that commenced over two years ago and included million of pages of documents, only 10 items were ultimately before the Court. […] The Court ruled in favour of Rimini Street on five”. (Source)
The Court issued Rimini Street with a permanent injunction ordering the organisation to ‘permanently discontinue the use and operation’ of various of its support programmes while further limiting others. The organisation was also ordered to issue a 14-point press release within 30 days of the ruling titled, ‘Court-ordered Statement Regarding Rimini Street’s False and Misleading Statements’. It was also required to limit statements it makes in marketing materials and communications about various Oracle products and services related to the trial that includes, “Oracle’s CPUs provide little to no value to customers and are no longer relevant,” as well as that “Rimini did not copy or share Oracle software between clients between February 2014 and January 2020”, amongst others. (Source)
Rimini Street released a statement disagreeing with several of the Court’s findings, comments, and rulings as well as filing a notice to appeal. It also listed several points where it felt it had succeeded in the trial.
This story looks far from over yet.
Five years of lawsuits, legal battles, and court cases leading to a 2015 trial. Then, eight years of appeals cases; a secondary phase of Rimini Street and Oracle basically chasing their own losses.
After well over a decade, and an ordeal that had ended badly for Rimini Street, organisations naturally drew their own conclusions about the validity of third-party support.
The story became, in its simplest terms, “there’s a third-party support provider that stole from Oracle and was sued.”
Rimini Street had familiarised the term and, unfortunately, damaged its reputation. It had demonstrated that third-party support can offer low-cost support services. It also “illustrated” that this was achieved through avoiding the costs of creating applications and stealing them instead. Rimini had set an incorrect example.
The good news that came out of this whole process: third-party support has been officially deemed legal.
The way Rimini Street was delivering its service was ruled as illegal. According to Rimini Street’s own website:
Detailed testimony and evidence provided by Oracle executives and witnesses in the 2015 trial confirmed that third-party support is lawful for Oracle licensees to purchase and use. The evidence presented at trial supported several important principles:
We do not condone Rimini Street’s illegal activities. However, we do agree on the above four points. Oracle licensees can switch to third-party support, rather than renewing and paying Oracle’s prices.
We have an additional advantage: a background as both an Oracle and SAP partner. Beginning as an Oracle and SAP consultancy in 1998 with our sister company, PDG Consulting, we have over 25 years of experience in the industry. We’re also the only third-party support provider in the world that can make this claim.
We actively encourage all Oracle and SAP customers to ensure they have the proper licences. When a customer joins Support Revolution, we check their licensing and their requirements. We let them know if they’re under or over-licensed.
And finally, we have been recognised by HMRC. Our customers include the National Audit Office, the Bank of England, and several other central government bodies. Each organisation has evaluated our services and agreed to our support.
To date, Rimini Street still has the permanent injunction set against it.
Here at Support Revolution, we have nothing in place against us.
We will soon be releasing a white paper on why third-party support IS legal. Check back here at a later date to be the first to read it.