Oracle to Put New HP CEO on the Stand in TomorrowNow Lawsuit

Published: October 18, 2010

by Timothy Prickett Morgan

The soap opera between Oracle and Hewlett-Packard has taken another bizarre turn and now it looks like Oracle is going to drag Leo Apotheker, former CEO at SAP and recently named CEO at HP, up on the stand in its ongoing lawsuit against SAP concerning its former TomorrowNow unit.

In August, several months after Apotheker had been shown the door and two new co-CEOs had been running SAP for a while, SAP's lawyers said that SAP accepted financial responsibility for the damage that might have been done by TomorrowNow, but balked at the idea that the damages were in excess of $1 billion, which Oracle said in its March 2007 lawsuit.

TomorrowNow was founded by some ex-PeopleSoft employees to provide third-party support for PeopleSoft applications, which was eventually expanded to cover Siebel Systems and JD Edwards software suites. SAP has no great love of Oracle, and acquired TomorrowNow in 2005. In 2007, Oracle sued SAP and TomorrowNow in the U.S. District Court for the Northern District of California in San Francisco alleging "corporate theft on a grand scale" and in July of that year, after reviewing how TomorrowNow gained access to and used Oracle's intellectual property in its third-party support biz, SAP conceded that mistakes were made, and in July 2008, SAP shut the unit down completely.

In January of this year, Oracle sued Rimini Street, another third-party provider of support for Oracle applications, in the U.S. District Court for the District of Nevada in Las Vegas, and two months later, Rimini Street sued Oracle back, alleging that Oracle has been engaging in illegal and anti-competitive business tactics for the last five years by trying to thwart its software updating business.

Last week, SAP confirmed to the Wall Street Journal that Apotheker has been added to a witness list for the trial, which begins on November 1.

Ray Lane, Oracle's new chairman, came out swinging a day later after New York Times columnist Joe Nocera ripped into HP's board for hiring Apotheker because of the lingering TomorrowNow suit and the obvious animosity that exists between Apotheker and Larry Ellison, Oracle's co-founder and chief executive officer. (You can read Nocera's column here, and note that Nocera's wife is a flack at Boies, Schiller & Flexner--yes, of course, that is Oracle's lawyers in the TomorrowNow and Rimini Street suit--so no conflict of interest there.)

This is a messy little snit, for sure. Lane was president of Oracle a few presidents ago. And now, of course, Ellison's tennis buddy, Mark Hurd, the ousted former president, CEO, and chairman of HP, is the one who Apotheker replaced. Lane came out swinging about the tactics of his former boss and Nocera's column. "Oracle has been litigating this case for years and has never offered any evidence that Mr. Apotheker was involved," Lane wrote in an open letter to the Times.

I will stand by what I thought as soon as Apotheker was named CEO at HP. They should have picked Lane out of the two, and they should have gone with Ann Livermore, who knows more about HP than Apotheker will even many years from now. If he lasts that long. Outside HP CEOs have had a short shelf life in the past decade.

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