Oracle 2008 Annual Report Download - page 125

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Table of Contents
ORACLE CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
May 31, 2009
its wholly owned subsidiary, SAP America, Inc., and its wholly owned subsidiary, TomorrowNow, Inc.,
(collectively, the SAP Defendants) alleging violations of the Federal Computer Fraud and Abuse Act and the
California Computer Data Access and Fraud Act, civil conspiracy, trespass, conversion, violation of the
California Unfair Business Practices Act, and intentional and negligent interference with prospective
economic advantage. Oracle alleged that SAP unlawfully accessed Oracle’s Customer Connection support
website and improperly took and used Oracle’s intellectual property, including software code and knowledge
management solutions. The complaint seeks unspecified damages and preliminary and permanent injunctive
relief. On June 1, 2007, Oracle filed its First Amended Complaint, adding claims for infringement of the
federal Copyright Act and breach of contract, and dropping the conversion and separately pled conspiracy
claims. On July 2, 2007 the SAP Defendants’ filed their Answer and Affirmative Defenses, acknowledging
that TomorrowNow had made some “inappropriate downloads” and otherwise denying the claims alleged in
the First Amended Complaint. The parties are engaged in discovery and continue to negotiate a Preservation
Order. At case management conferences held on February 12, 2008 and April 24, 2008, Oracle advised the
Court that Oracle intended to file a Second Amended Complaint, based on new facts learned during the
course of discovery.
On July 28, 2008, Oracle filed a Second Amended Complaint, which added additional allegations based on
facts learned during discovery. Among the new allegations contained in the Second Amended Complaint,
Oracle alleges that TomorrowNow’s business model relied on illegal copies of Oracle’s underlying software
applications and that TomorrowNow used these copies as generic software environments that TomorrowNow
then used to create fixes and updates, to service customers and to train employees. The Second Amended
Complaint also alleges that these practices may have extended to other Oracle products, including Siebel
products.
On October 8, 2008, Oracle filed a Third Amended Complaint pursuant to stipulation. The Third Amended
Complaint made some changes relating to the Oracle plaintiff entities (removing Oracle Corporation and
adding Oracle Systems Corporation, Oracle EMEA Ltd., and J.D. Edwards Europe Ltd.) but did not change
the substantive allegations. On October 15, 2008, the SAP Defendants filed a motion to dismiss portions of
the Third Amended Complaint, and after full briefing, the court heard oral argument on November 26, 2008.
On December 15, 2008, the court issued an order granting in part and denying in part the motion. The court
dismissed with prejudice the claims asserted by plaintiffs JD Edwards Europe Ltd. and Oracle Systems
Corporation, and denied the motion in all other respects. The parties are engaged in discovery.
On May 28, 2009, the court held a case management conference. On June 11, 2009, the court entered a
Stipulated Revised Case Management and Pretrial Order. Pursuant to the terms of that order, Oracle may
move to amend its complaint to add claims for infringement of Oracle’s Siebel software programs and any
other claims or allegations agreed to by the parties prior to July 15, 2009. The order allows SAP to file an
early motion for summary judgment directed to Oracle’s damages theory. The court set a new trial date of
November 2010 and made certain other changes to the pretrial schedule.
Other Litigation
We are party to various legal proceedings and claims, either asserted or unasserted, which arise in the
ordinary course of business, including proceedings and claims that relate to acquisitions we have completed
or to companies we have acquired or are attempting to acquire. While the outcome of these matters cannot be
predicted with certainty, we do not believe that the outcome of any of these claims or any of the above
mentioned legal matters will have a materially adverse effect on our consolidated financial position, results of
operations or cash flows.
117
Source: ORACLE CORP, 10-K, June 29, 2009 Powered by Morningstar® Document Research℠