<quote>
In his testimony last week, Schwartz explained his "grit our teeth" strategy after Android had its public debut as an incompatible variant of Sun's Java. "We saw a handset bypass our brand and licensing restrictions...we decided to grit our teeth and support it so anyone supporting it would see us as part of the value chain," he said. Apparently, continuing to seek a way to work with Google -- to turn lemons into lemonade, as Gosling wrote -- was preferable to engaging in a costly lawsuit.
</quote>
So Sun chose not to sue Google, because it would be costly (and because they knew they'd lose). They could have afforded it, but they chose not to.
History shows that was probably the right decision - As previously mentioned Google kept Android Java close to Sun Java, while now they have stopped updating it and may be considering other platforms.
BTW, you realise Gosling isn't exactly an impartial player here, right? He's always been against open sourcing Java (and open source generally: the EMACS wars probably had something to do with that), and sees what Google did as justification for his opposition. Others (including myself) see Google's actions as vindication of the Java Open Source strategy: it expanded the Java ecosystem into new fields, and made Java more important, not less.
http://news.cnet.com/8301-1035_3-57423754-94/java-creator-ja...
<quote> In his testimony last week, Schwartz explained his "grit our teeth" strategy after Android had its public debut as an incompatible variant of Sun's Java. "We saw a handset bypass our brand and licensing restrictions...we decided to grit our teeth and support it so anyone supporting it would see us as part of the value chain," he said. Apparently, continuing to seek a way to work with Google -- to turn lemons into lemonade, as Gosling wrote -- was preferable to engaging in a costly lawsuit. </quote>