Oracle sues SAP over alleged corporate theft

23 Mar 2007

Oracle yesterday filed a lawsuit against enterprise software rival SAP, alleging the European software company broke into its computer system to steal confidential information.

The case, lodged at the District Court in San Francisco, has been described by Oracle as being about “corporate theft on a grand scale”.

Oracle claims it discovered SAP was engaged in systematic and illegal access to Oracle’s computerised customer support systems and alleges that SAP stole thousands of proprietary, copyrighted software products and other confidential materials.

“From that website, SAP has copied and swept thousands of Oracle software products and other proprietary and confidential materials onto its own servers. As a result, SAP has compiled an illegal library of Oracle’s copyrighted software code and other materials,” Oracle alleged in its case filing.

Oracle claims that this storehouse of allegedly stolen Oracle intellectual property would enable SAP to offer cut-rate support services to customers who use Oracle software and lure them to SAP’s rival platform.

In its filing Oracle said that in late November last year it discovered unusually heavy download activity on Oracle’s password-protected customer support site for its PeopleSoft and JD Edwards product lines, which contains proprietary software for download.

It said that there were more than 10,000 illicit downloads from the site between September last year and January of this year, a systematic sweeping of Oracle’s support website from SAP TN servers prior to the expiry of customer licenses.

Oracle said it has invested billions of dollars in research and development (R&D) for these products – which include patches, updates, bug fixes and instructional documents – and regards them as a vital subset of technical support.

The acquisitions of JD Edwards and PeopleSoft alone amounted to US$20bn and Oracle is seeking to protect the recurring annual technical support fees of 22pc of the original cost of the software that it sells.

Oracle alleges that SAP employees used the log-in credentials of Oracle customers with expired or soon-to-expire support rights and within days accessed and copied thousands of individual software and support materials. These companies included manufacturing company Honeywell International and pharmaceutical giant Merck & Company.

Oracle said the alleged thefts did not originate from a customer location but from an IP address belonging to an SAP America branch office in Texas.

Alleging SAP employees used the log-in IDs of multiple customers combined with phoney log-in information, Oracle said: “All of these customers whose IDs SAP appropriated had one critical fact in common: they were, or were just about to become, new customers of SAP TN – SAP AG and SAP America’s software support subsidiary whose sole purpose is to compete with Oracle.”

By John Kennedy