Disclosure: I work for Microsoft but that is a very new thing (the J++ dispute was many years ago)
IIRC, the J++ suit had to do with the specific terms of a license agreement that Sun and Microsoft had entered into. I don't think it was much like this where Google claimed to have done a non-infringing clean-room reimplementation claiming this didn't require a license from Sun/Oracle at all.
Google did a clean room implementation, while making a clear distinction between Java the language and Java the VM, while avoiding doing any kind of public statement that could violate the Java licensing trademark.
So now you have an environment, where Java the language version 6 can be used, while Java the language version 8 is going to appear next year, without any signs of ever appearing in Android.
Now, quite possibly as consequence of the litigation, Java developers targeting Android have to live with Java the language version 6 forever.
The end result is no different than the fragmentation Microsoft attempted with J++, but since it is Google, it is ok to do so.
Yeah. My sense is that Android developers aren't nearly as interested in 'Java the write once run everywhere platform' as developers who were adopting Java in the 1990s. So, like Apple and ObjectiveC, mobile developers are just willing to go where the platform takes them rather than push for evolution of the language per se.
Maybe it's just that mobile apps are much smaller than the monsters enterprise devs need language help to manage.
Speaking as a sometime Android developer, I use Java for Android because I have to, not because I'm particularly fond of Java. The biggest upside of a JVM on Android in this respect is that I have alternative languages like Kotlin available.
Dart is excellent in few cases on the client. First, if you can forget about older browsers, and second if you don't need to use a lot of pre-existing JavaScript libs in your app, and third if you don't need to use the web control on iOS. Dart as a Chrome Packaged App should shine. I really enjoy developing in it. I don't have any experience with it on the server, so couldn't say there.
IIRC, the J++ suit had to do with the specific terms of a license agreement that Sun and Microsoft had entered into. I don't think it was much like this where Google claimed to have done a non-infringing clean-room reimplementation claiming this didn't require a license from Sun/Oracle at all.