Judge Vaughn Walker, presiding over the U.S. District Court, Northern District of Calif., handed down his ruling in the U.S. Department of Justices case to block Oracles hostile takeover of PeopleSoft Inc., according to court records released late Thursday.
The DOJ argued in its case that Oracles hostile buyout of PeopleSoft would sharply reduce competition in the ERP (enterprise resource planning) software market to the point where it could illegally control prices. Oracle argued that the tier-one ERP software market was much broader than the Justice Departments definition: comprised only of Oracle, PeopleSoft and SAP AG.
Citing issues with the Justice Departments depiction of the software market, Judge Walker denied its request for a federal injunction to block the deal.
"Plaintiffs failed to show ERP vendors distinguish midmarket customers from large customers on the amount of money spent in an ERP purchase. Yet … this was the basis on which plaintiffs attempted to quantify the ERP market," reads Judge Walkers ruling.
R. Hewitt Pate, assistant attorney general in charge of the Justice Departments antitrust division said in a statement that it is "considering its options."
"We are disappointed in the Courts decision. We believe the facts and evidence in this case support our position that Oracles proposed acquisition of PeopleSoft would result in a substantial lessening of competition in the markets for high function human resources management and financial management systems software," said Washington D.C.-based Pate, in the statement.