Oracle to expand SAP lawsuit, may target execs

by James Niccolai

April 18, 2008 —

Oracle plans
to expand its lawsuit against SAP
to include charges that its TomorrowNow
subsidiary stole software applications from Oracle, and that it did so with
the knowledge of SAP executives, according to court papers filed Thursday.

Oracle said it plans to file a second amended complaint against SAP and TomorrowNow
that will reveal "a pattern of unlawful conduct that is different from,
and even more serious than," the conduct described in its initial complaint.

SAP's lawyers accused Oracle of exaggerating its claims, using court filings
as "press releases" and trying to prolong the case unnecessarily.
"Ignoring Judge Jenkins's admonitions, Oracle continues to submit hyperbolic
argument in the guise of (court documents)," SAP's lawyers wrote.

Oracle filed its suit against SAP a year ago, alleging that TomorrowNow employees
posed as Oracle customers in order to download software patches and other support
materials from an Oracle support Web site. TomorrowNow used the materials to
provide cut-price services to Oracle customers, and try to switch them to SAP's
platform, Oracle said.

Based on recent depositions, Oracle now claims that TomorrowNow workers downloaded
Oracle business applications, as well as just its support materials. "TomorrowNow
then used the software "to service other customers, train its employees,
and create fake 'SAP' branded fixes, updates and related documentation for distribution,"
Oracle said.

It also said SAP executives may have been complicit -- something SAP has vehemently
denied. "It appears that SAP AG and SAP America knew -- at executive levels
-- of the likely illegality of TN's [TomorrowNow's] business model from the
time of their acquisition of TN and, for business reasons, failed to change
it," Oracle said. It did not name any SAP executives.

The new charges are outlined in a 30-page joint filing submitted ahead of a
case management conference scheduled for next week at the U.S. District Court
for the Northern District of California in San Francisco. Oracle said it hopes
SAP will agree to its filing the amended complaint, otherwise it will amend
the new charges to the current one.

SAP did not return a call for comment Thursday evening. It posted
the documents on its Web
site about the case. Oracle also has a Web
page about the suit.

SAP has admitted that TomorrowNow may have made some "inappropriate downloads"
from Oracle, and has replaced top executives at the subsidiary since the case
was filed. But it has characterized any wrongdoing as isolated incidents, rather
than the pattern of illegal behavior that Oracle alleges.

Oracle is seeking damages to be proven at trial, an injunction for SAP to return
any Oracle software, and legal costs.

SAP reluctantly agreed with Oracle to push the jury trial date back by a year
to February 2010, the new documents show. Oracle said it needs the time to complete
discovery. SAP wants to retain the date for a settlement conference this October,
but Oracle asked the court to delay that by a year also.

SAP's lawyers repeatedly expressed frustration at Oracle for what they view
as delaying the case by demanding "limitless discovery." They asked
the court to make Oracle explain soon how SAP's conduct has damaged the company.

"Oracle recites essentially every element of every one of its claims as
a factual dispute, ignoring that its repetitive claims all boil down to the
same basic issues -- what was allegedly copied; was that copying permissible;
how was Oracle harmed? Those are the factual issues in dispute," SAP said.

"Oracle does not want to be focused, nor does it apparently want to effectively
or timely resolve this case," it said.

Oracle said the case involves an "extraordinary" amount of discovery,
including terabytes of computer records that take weeks just to copy, forensic
scientists, and "potentially hundreds of third parties." It also asked
to extend the length of the trial from four weeks to six.

IDG News Service