Feeds

Oracle demands another $211.6m from SAP

'Ahem, where's our interest on the $1.3bn?'

Boost IT visibility and business value

Oracle just keeps rubbing it in with application software rival SAP over the TomorrowNow fiasco.

In a court filing on Friday, which was reported by various news outlets (see here and there, Oracle has gone back to the US District Court for the Northern District of California in Oakland, where a jury just awarded Oracle a $1.3bn payout an SAP a very large spanking. SAP's former third party software support organization, TomorrowNow, which peddled tech support for Oracle's PeopleSoft, Siebel, and JD Edwards ERP suites and which was acquired by SAP in January 2005.

The problem with TomorrowNow, as SAP found out too late, is that TomorrowNow was indeed using Oracle's own copyrighted documents and software patches to fulfill its support contracts, which is what Oracle alleged in its March 2007 lawsuit, seeking billions of dollars in damages. SAP eventually admitted this was the case, as if that would somehow placate Oracle CEO and co-founder, Larry Ellison.

Uh, not so much.

With the $1.3bn in damages awarded to Oracle over the TomorrowNow theft, SAP acquisition of the small support company could go down as the worst software acquisition in history. And whoever did due diligence on the deal deserves to be sued by SAP. (Don't be surprised when that happens.)

In its Friday filing, Oracle's lawyers argued that SAP should pay "prejudgment interest" for 2005 and 2006. SAP has already agreed to pay $120m in legal fees to Oracle and was thinking the damages might be on the order of $28m to $41m for the 358 customers that TomorrowNow lured away from paying Oracle for support for its ERP stacks.

"We don't believe that Oracle is entitled to any additional compensation beyond the final judgment in this case," an SAP spokesperson told the Wall Street Journal.

Uh, no kidding.

SAP paid $10m to acquire TomorrowNow, which was supposed to be a thorn in Oracle's side, more of a PR stunt than a big-time revenue generator. SAP has not said how much revenue TomorrowNow generated between 2005 when SAP acquired it and when it was shut down in the summer of 2008, but assuming SAP was thinking about treble damages, then the unit drove maybe $14m in revenues across those 358 customers.

But if you do the math and if the US District Court in California gives Oracle the interest it is asking for, then SAP will end up paying $1.64bn for TomorrowNow, including the acquisition cost, fines, and interest. That's 4.58m per customer - a very big number. None of this takes into account the PR damage from buying a company that was stealing software and being harangued by Larry Ellison.

When does Oracle ask for interest on the interest? Sometime after SAP's appeal, if the company doesn't just cut the check to Oracle to make this whole thing go away. ®

Application security programs and practises

More from The Register

next story
HIDDEN packet sniffer spy tech in MILLIONS of iPhones, iPads – expert
Don't panic though – Apple's backdoor is not wide open to all, guru tells us
Apple fanbois SCREAM as update BRICKS their Macbook Airs
Ragegasm spills over as firmware upgrade kills machines
Captain Kirk sets phaser to SLAUGHTER after trying new Facebook app
William Shatner less-than-impressed by Zuck's celebrity-only app
Do YOU work at Microsoft? Um. Are you SURE about that?
Nokia and marketing types first to get the bullet, says report
Microsoft takes on Chromebook with low-cost Windows laptops
Redmond's chief salesman: We're taking 'hard' decisions
Cheer up, Nokia fans. It can start making mobes again in 18 months
The real winner of the Nokia sale is *drumroll* ... Nokia
EU dons gloves, pokes Google's deals with Android mobe makers
El Reg cops a squint at investigatory letters
prev story

Whitepapers

Seven Steps to Software Security
Seven practical steps you can begin to take today to secure your applications and prevent the damages a successful cyber-attack can cause.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
Designing a Defense for Mobile Applications
Learn about the various considerations for defending mobile applications - from the application architecture itself to the myriad testing technologies.
Build a business case: developing custom apps
Learn how to maximize the value of custom applications by accelerating and simplifying their development.
Consolidation: the foundation for IT and business transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.