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Oracle sues SAP over alleged illegal access to support systems

Thursday, March 22, 2007
Oracle Corp. took its bitter rivalry with business applications vendor SAP AG up another notch, filing suit Thursday against SAP alleging violations of U.S. fraud legislation, unfair competition and civil conspiracy


This case is about corporate theft on a grand scale," the lawsuit contends. Oracle alleges it has discovered that SAP is "engaged in systematic, illegal access" to Oracle's computerized customer support systems.

Oracle filed the lawsuit against SAP, its SAP America division and its TomorrowNow subsidiary in U.S. Federal District Court in the Northern District of California. Details of the complaint can be found here. TomorrowNow provides third-party maintenance and support in large part for Oracle applications drawn from its PeopleSoft, Siebel and JD Edwards product families.

In the suit, the database, applications and middleware vendor alleges that SAP violated the Federal Computer Fraud and Abuse Act and California Computer Data Access and Fraud Act. Oracle also charges SAP with intentional and negligent interference with prospective economic advantage, unfair competition and civil conspiracy. The vendor demands a jury trial and is seeking both damages and injunctive relief. Through the complaint, Oracle seeks to stop SAP's illegal intrusions into its computer systems and theft, to prevent SAP from using the materials it has illegally acquired to compete with Oracle, and to recover damages and attorneys' fees," the lawsuit states.

"Through this scheme, SAP has stolen thousands of proprietary, copyrighted software products and other confidential materials that Oracle developed to service its own support customers," the lawsuit states.

The suit points to a period of unusually heavy download activity from Oracle's Customer Connection user support Web site for its PeopleSoft and JD Edwards applications in late November and December 2006. The site contains Oracle copyright material including software updates, bug fixes and patches. Customers paying Oracle for support log into the site with their passwords and download the software they require. Instead of genuine users, the suit alleges SAP employees used the log-in credentials of Oracle customers whose support rights had already expired or were about to expire in a few days' time. Those staffers then allegedly copied Oracle's software and support materials.

Through that access, SAP ended up with "an illegal library of Oracle's copyright software code," the complaint said. Using that information, SAP offered cut-rate support services to Oracle customers in the hopes of eventually migrating them over to use SAP's rival applications.

SAP could not be immediately reached for comment.

David Dobrin, founder and president of B2B Analysts in Cambridge, Massachusetts, said he does not think anyone at TomorrowNow's management did anything wrong.

"I don't see this as TomorrowNow's management trying to cross some line or cheat or steal," he said. "The most likely thing is some rogue employees were doing something they thought was legitimate and maybe it was and maybe it wasn't, but Oracle decided it wasn't and is filing suit against SAP."

Dobrin said that Oracle likely sued SAP even though TomorrowNow acts independently of its parent company because "they get a lot more publicity, and SAP has deeper pockets." However, he said from his experience in talking with executives from SAP and TomorrowNow, the companies do try to keep their businesses separate to avoid a conflict of interest. "(This situation) has nothing to do with SAP," Dobrin said.

Oracle representatives have not yet responded to a request for additional comment on the lawsuit.

-- IDG Newswire

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