SAP Watch

May 21 2007   1:05PM GMT

Oracle vs. SAP lawsuit: Hardball or posturing?

JackDanahy Jack Danahy Profile: JackDanahy

The Oracle lawsuit against SAP has kind of faded into the background since the news broke in March. There’s been a flurry of acquisitions on both sides of the fence, SAP and Microsoft have deepened their relationship, and a bunch of other stuff popped up around the Sapphire events in Atlanta and Vienna.

But the fight is far from over. The alleged misdeeds of SAP’s support organization TomorrowNow are not forgotten by Oracle, even as the first judge recused herself from the case. Indeed, first the Oracle team pushed through a measure to make sure SAP kept all relevant records around the alleged incident and now Larry Ellson has gone on the record stating that he would not accept an out-of-court settlement with SAP.

Not so fast there, Larry. Is SAP really on the ropes, trying to weasel it’s way out from under certain defeat? Columnist and veteran SAP expert Josh Greenbaum doesn’t think so.

In the absence of a definitive statement offering a settlement — and there has been no such offer — Larry’s statement to the German press is pure posturing. SAP is on record as being willing to see this battle through, and I expect them to. But I’m not surprised at Ellison’s statement: this lawsuit is all about posturing, and has no real merit with respect to its principle allegations, particularly those that allege direct senior managment involvement and approval in the actions Oracle is saying happened.

At some point I think Oracle should worry that this lawsuit could backfire: there’s a danger for Oracle is pursuing this, as discovery would put a large amount of unflattering information regarding Oracle’s maintenance fees and contracts into the public domain.

That’s a valid point for sure. We asked Steve Bauer, SAP’s VP of global communications, to comment on SAP’s side of the story on Ellison’s latest play. Here’s the official response:

Through this suit, Oracle seeks to limit customer choice and impede competition. SAP and TomorrowNow offer a viable alternative to Oracle support that the marketplace has embraced. SAP firmly believes that third-party support, which meets a growing customer need, plays a vital role in the enterprise software industry. SAP will vigorously defend against the charges brought by Oracle.

Our take on this: Oracle is trying to pull a fast one to confuse the market. SAP never offered a settlement, and those of you who attended Sapphire Atlanta may recall SAP Americas CEO Bill McDermott making SAP’s stance quite clear weeks before Ellison made this latest move. “We will, in the coming days, vigorously respond to this allegation, and the strength of our response will be clear and decisive,” McDermott said.

There’s a good chance that Oracle is trying to blow as much hot air as possible into this debacle now in an attempt to shame and discredit SAP, only to fold before the rubber hits the road. There has already been an extension to give Oracle more time to put together an “amended complaint,” allowing Oracle two more weeks to strut around. Will there be a second extension request? Will Oracle really have the guts to lay all the cards on the table? Time will tell, but Ellison’s latest move reeks to high heavens.

Matt Danielsson
Editor

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  • JackDanahy
    Good news to hear that the truth is surfacing and that common sense will prevail. I think Oracle should focus their efforts on patching together all that software they acquired over the last few years. Perhaps, that might be in their customers best interest, rather than wasting everyone's time in court.
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