John Paczkowski

Recent Posts by John Paczkowski

Oracle, SAP and the Apotheker Sideshow

Why is Oracle so intent on putting former SAP CEO and new HP chief Léo Apotheker on the stand in the trial that will determine damages in Oracle’s long-running IP battle with its German rival?

SAP insists it’s to create a “PR sideshow”–which is true to an extent. But sometimes there’s more to a sideshow than meets the eye. Which is not to say that some nefarious scheme lies at the heart of all this, just that there is a lot of subtext to make sense of in this case. And it’s being written from two very different views of how damages should be calculated and how important Apotheker is as a variable in that calculation.

SAP’s view is that now that it has stipulated to liability, damages should be determined according to the actual number of contracts won by TomorrowNow and their value–not according to the number of contracts it hoped to win.

Oracle’s view is that damages should be determined by value of the intellectual property stolen from it and SAP’s ambitions for it. And while SAP’s stipulation to liability prevents Oracle from introducing evidence on liability, it leaves it free to introduce evidence for “context” on damages.

And that’s where Apotheker comes in.

According to evidence presented in the case, Apotheker chaired the launch of the Safe Passage program, of which the TomorrowNow acquisition was one part. And in his depositions, former SAP board member Shai Agassi clearly identified Apotheker as having some responsibility for TomorrowNow post acquisition, along with Gerd Oswald.

“I was the guy who led the the evaluation [of TomorrowNow] with Werner Brandt, who managed the acquisition teams at the time,” Agassi said. “The day of the acquisition, it was basically moved to Gerd Oswald, and the sales effort was moved over to Apotheker. So Safe Passage was managed by Apotheker and Oswald.”

Add to this the fact that Apotheker reported on TomorrowNow and the Safe Passage program in SAP earnings calls and was the only senior SAP exec quoted in a company release touting the program’s success, and it seems reasonable to expect that he might be able to provide some of the “context” Oracle is looking for (click document below to enlarge). One could argue that his expectations and forecasts for the program’s success speak directly to Oracle’s damages.

Or one could argue, as SAP and HP do, that his involvement was incidental and that he had no responsibility for TomorrowNow’s day-to-day operations and hence no knowledge of its transgressions.

But unless he testifies under oath, we’ll never know who’s right. And with Apotheker quietly going about his business at an undisclosed location, it’s looking like that’s how things will end up.

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