JDA Software Group Inc. said its i2 Technologies unit lost a software-licensing dispute against Dillard's Inc. and was ordered to pay $246 million in damages.

Dillard's had alleged i2 failed to meet obligations regarding two software-license agreements for which the department-store operator had paid $8 million. The award by a state jury in Dallas included $238 million in punitive damages, which isn't meant to be compensatory but is instead meant to deter the defendant and others from engaging in similar conduct.

JDA said it "is evaluating the outcome and intends to pursue all available paths to overturn the verdict." The maker of supply-chain software said it believes there are several grounds for reversing the decision or significantly reducing the damages.

Chief Executive Hamish Brewer added, "We believe this verdict is unjustified given the nature of this commercial dispute."

Write to Matt Jarzemsky at matthew.jarzemsky@dowjones.com