All this started when SAP acquired TomorrowNow Inc., in year 2005, a third-party support provider for customers running PeopleSoft and J.D. Edwards (JDE) software, and started offering an incentive program in order to lure customers away from rival Oracle Corp.
This acquisition took place during the same time when Oracle was acquiring PeopleSoft Inc. (Including JD Edwards), therefore, being a prominent third party support provider for PeopleSoft & JD Edwards, TomorrowNow was used as a “Sales driver” to take business away from Oracle resulting in Copyright Infringements of Oracle’s Intellectual property rights, For more than 3 years, It’s not only illegally downloaded Oracle’s software, Source codes but millions of Oracle files too and then reselling that software and related services to its own existing customers. (Means huge loss in reverse business)!!!
Interesting fact is that, prior to acquisition SAP’s top officials (Including Ex- SAP CEO Leo Apotheker, Now CEO at HP) were quite aware of TommorrowNow indulged in illegal practices even though it din’t stop until Oracle filed suit in year 2007 and within the following year itself on Oct 22nd 2008, SAP closed TomorrowNow.
Some board executives from SAP said; they had assumed that this practice has been freezed however nobody ever followed up; according to their official testimony, SAP admitted liability, damages and copping to contributory liability which includes its own negligence in the matter.
To read SAP’s statement visit; http://www.tnlawsuit.com/
On Nov15, 2010, in a recent statement given by SAP AG Co-CEO Bill McDermott told a jury that “TomorrowNow was not a big driver of software sales and wasn’t a very successful concept” during the trial at federal court (Oakland, CA)
Oracle counted it’s monetary damages around $1.65 Billion for abusing the intellectual property rights while SAP’s legal panel came with a figure nearby $40 Million (way less than what oracle claimed) leaving the fact that SAP-TomorrowNow must have made around $800-900 Million over three years (2005-08)
The jury had to decide first based on Hypothetical situation for both sides, from the day SAP acquired TomorrowNow (Knowing the fact that it’s a reputed Third party service provider to PeopleSoft & JD Edwards) with a mindset of 3 years strategic plan for luring PeopleSoft & JD Edwards customers and shifting them to SAP platform later on adding good numbers in SAP’s customer base through it’s “Safe Passage” programme.
PS: An overview about SAP’s “SAFE PASSAGE” programme.
By year 2005 till 2007, TomorrowNow was the only company reputedly known for third party maintenance for PeopleSoft, at that time they had about 65 customers, including 24 out of Fortune 500.
Now under the blockbuster “Safe Passage” programme SAP clearly meant to help existing PeopleSoft customers who avails services from TomorrowNow would get a credit towards the purchase of SAP Software to replace the existing PeopleSoft system.
Not sure, whether the settlement amount has to be paid by SAP or not but certainly it looks that this case will get stretched further for quite some time. An SAP spokes person told Bloomberg that “We are, of course, disappointed by this verdict and will pursue all available options, including post trial motions and appeal if necessary.” This will unfortunately be a prolonged process and we continue to hope that the matter can be resolved appropriately without more years of litigation. The mark of a leading company is the way it handles its mistakes. As stated in court, we regret the actions of TomorrowNow, we have accepted liability, and have been willing to fairly compensate Oracle. Throughout this matter, our customers, employees and partners have stood by us and, for that, we are grateful. Our focus now is looking forward, helping our customers be best run businesses, and extending our legacy of industry leadership well into the future. We thank the jury for its diligent service through this lengthy trial and the Court for its supervision of this complex case."
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