This gives CedarCrestone "the ability to promise prospects a quick -- though infringing -- first deliverable," the suit adds.
In addition, CedarCrestone intentionally misled customers about the nature of its relationship with Oracle, according to the suit. For example, company representatives told officials in Oklahoma City that CedarCrestone's services are done "in a manner that is free of intellectual property infringement," it states.
CedarCrestone should know the restrictions in Oracle's software licenses all too well, since itself is a heavy user of Oracle's PeopleSoft application, according to the suit.
Oracle is suing for copyright infringement, breach of contract and unfair competition. It is seeking an injunction against CedarCrestone along with unspecified damages and costs.
The allegations Oracle has made against CedarCrestone only hint at the broader issues in play.
Third-party maintenance providers charge less for their services than vendors, appealing to customers who have stable, generally older systems and don't wish to immediately upgrade, which is only possible to do legally by remaining on vendor-provided support.
But for software companies, annual maintenance revenue is lifeblood, as it keeps rolling in from the installed base every year even when new license sales are slow and carries huge profit margins.
Oracle's allegations against CedarCrestone are generally similar to those lodged against SAP, TomorrowNow and Rimini Street, the latter of which Oracle is also suing. Rimini Street has maintained no wrongdoing and says it acts within the boundaries of its customers licensing rights.
SAP admitted liability for wrongdoing on the part of TomorrowNow, which offered Oracle software support, and a jury awarded Oracle $1.3 billion in 2010, but a judge set that award aside and the case has yet to be fully resolved. Last week, Oracle lodged an appeal of a US$306 settlement that it had reached with SAP.
While CedarCrestone competed with Oracle for tax and regulatory support services, the companies had a close relationship on other fronts, even signing a co-development pact at one point "to enhance Oracle's PeopleSoft Enterprise Pension Administration and related products," according to a 2009 press release. Those ties may have helped stave off litigation on Oracle's part.
Meanwhile, CedarCrestone is now also an implementation partner for Workday, a cloud-based ERP vendor that is giving Oracle increasingly stiff competition for some deals.