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Oracle lawyers have a six-plus-hour video deposition taken in 2008 of then-SAP co-CEO Leo Apotheker discussing copyright infringement litigation against Oracle, but it may never be seen by the jury in the case because it was filmed before SAP actually admitted misusing Oracle’s IP.
Apotheker, who took over as CEO of Hewlett-Packard on Nov. 1, has been out of the country touring HP locations and talking to employees and has been unable to be subpoenaed to update his testimony in person in the damages phase of the complicated three-and-a-half-year-old IP theft case.
The case is being tried before U.S. District Court Judge Phyllis Hamilton and an eight-person jury in Oakland, Calif.
The court case, originated by an Oracle lawsuit first brought in 2007, is to determine how much SAP will be fined for the actions of a now-defunct, former wholly owned subsidiary, TomorrowNow.
Oracle originally said it wanted $2.15 billion in restitution; SAP believes a figure in the neighborhood of $40 million is fair.
SAP, which admitted corporate responsibility for TomorrowNow’s misdeeds just before the trial started, already has paid $120 million to cover court costs incurred by Oracle.
There is disagreement, even among Oracle staff, about the amount of restitution SAP should provide.
On Nov. 9, Paul Meyer, Oracle’s damages expert, told the court that SAP should pay Oracle $1.66 billion. Oracle CEO Larry Ellison had testified on the previous day that the eight million software images and thousands of pages of documentation downloaded by SAP was worth as much as $4 billion.
Better for the jury not to see deposition, lawyer says
Oracle attorney David Boies, well-known in IT circles for his many cases in the sector, explained Nov. 12 that it might be better for Oracle if Apotheker’s video deposition is not shown to the jury.
“Maybe we’ll just let the jury know that they’ve hidden him,” Boies told a group of reporters. “I think it may be better for the jury to know that here’s this guy who was at the center of all this [and Oracle can’t find him].”
In other words, there is the appearance of impropriety simply by Apotheker’s absence.
Boies argued Oracle’s case about the importance of Apotheker’s new testimony by issuing this statement Nov. 12:
“Shai Agassi [a former member of SAP’s board of directors] identified Leo Apotheker as being responsible for Safe Passage [SAP’s 2005-era program to acquire new business], with TomorrowNow as its cornerstone. Werner Brandt [SAP director and CFO] did the same and testified that Mr. Apotheker was a member of the SAP AG Executive Board that fully supported the acquisition of TomorrowNow. He is clearly a very important witness in this case, especially now.
“When he testified at his deposition more than two years ago, it was before SAP and its wholly owned subsidiary TomorrowNow admitted infringing Oracle’s intellectual property through massive downloading and copying of PeopleSoft, JD Edwards and Siebel software [owned by Oracle].
“We think it is very important that Mr. Apotheker testify now, as a live witness in court, to explain his and SAP’s conduct.”
SAP spokesman Saswato Das told eWEEK via e-mail that “Oracle’s heightened interest in Mr. Apotheker as a live witness came only subsequent to his appointment as HP’s CEO. This is PR sideshow that has little to do with the real issues of this case: the actual damages from the limited operations of TomorrowNow.”
HP has claimed Oracle simply wants to harass its new chief executive in an effort to discredit him. HP and Oracle, though partners in some product lines, are now bitter rivals in others — including sales of servers, storage and enterprise middleware.
SAP is expected to present its arguments beginning Nov. 15, Das told eWEEK.
Apotheker subject to subpoena if he’s seen in the neighborhood
Apotheker took over the top executive position at HP on Nov. 1. If he comes within 100 miles of the trial location in Oakland, Calif., he will become subject to a subpoena to testify in the case.
Apotheker was CEO of SAP when the company — through an American-based affiliate, TomorrowNow — illegally downloaded millions of instances’ worth of Oracle software and product documentation some three to five years ago. SAP already has admitted responsibility for TomorrowNow’s actions.
Therese Poletti of MarketWatch.com reported Nov. 12 that Apotheker has been sighted by HP employees during a tour of various non-California HP locations — most recently in Texas and Massachusetts.
HP, which has not been commenting on the record about the case, must have known that Apotheker was on a preliminary list of witnesses to be called in Oracle’s damages trial against SAP.
Although SAP and HP insist that his name only appeared on a list of witnesses after he was named CEO, Oracle claims that Apotheker was on a list of potential witnesses to be called before former CEO Mark Hurd left Hewlett-Packard on Aug. 6.
HP corporate spokeswoman Gina Tyler did send this statement to eWEEK late Nov. 12:
“As HP has said repeatedly, Oracle had ample opportunity to question L??«o in the two years after he gave a full-day deposition. L??«o was never asked to give an additional deposition. As HP and SAP have noted, Oracle chose not to include L??«o as a live trial witness until after he was named CEO of HP. L??«o had a limited role in the matter and Oracle’s current stance is clear proof that they have been trying to harass L??«o and interfere with his work at HP.”
Apotheker was named the new CEO of HP on Oct. 9, two months after his predecessor, Hurd, was forced to resign following charges of sexual harassment by a former HP contractor and a subsequent expenses-related coverup. Hurd has since settled the complaint out of court.
To add even more intrigue to the case, Hurd was named co-president of Oracle on Sept. 6, one month after leaving HP.
Case has been in play since 2007
HP refused to accept a subpoena requested by Oracle at its Palo Alto headquarters for Apotheker last week, when the trial began in federal court in Oakland. The company said it does not disclose the whereabouts of its executives.
Ellison, testifying in the punishment phase of the trial that started Nov. 1, told Judge Hamilton and a packed courtroom Nov. 8 that he was “deeply worried” about his company “bleeding customers” because of SAP’s actions to lure customers away from Oracle.
Ellison said that Oracle actually estimates that the copyright infringement has cost Oracle upwards of $4 billion, although he admitted in court that he does not have documentation to prove that he and his staff discussed this figure.
Under persistent questioning by SAP’s attorneys, Ellison admitted that the actions of SAP’s former subsidiary resulted in about 350 customers leaving Oracle and moving to SAP.
Two years after it was acquired by SAP, TomorrowNow was caught stealing Oracle’s intellectual property by gaining unauthorized access to a customer-support Oracle Website and downloading copyrighted instances of support software and thousands of pages of documentation.
Oracle claimed that more than 8 million instances of its enterprise support software worth $2.15 billion were stolen, stored on SAP’s servers and used without its permission.
It also charged that SAP/TomorrowNow deployed automated bots that used Oracle’s own software to lure customers from PeopleSoft (owned by Oracle) over to SAP.
Enterprise support software amounts to about half of Oracle’s annual revenue.
Editor’s note: This story has been updated with more details on the case and a statement from HP.