PeopleSoft users to testify in Oracle case

21 May 2004 Users of PeopleSoft software are to be called to testify in the forthcoming court case that will consider if Oracle’s hostile takeover of its enterprise applications rival can proceed.


The US Justice Department (DoJ), which wants to block the $7.7 billion deal, is set to call a number of major customers to the witness stand.

These include automotive giant DaimlerChrysler, stockbroker Charles Schwab, US rail operator Metro North, travel company Greyhound Lines, telecoms giant Verizon and energy company Kerr-McGee.

They are likely to be asked whether an Oracle takeover of PeopleSoft would harm their respective businesses. PeopleSoft fears that Oracle would discontinue support for its products, if the merger went through, although Oracle has consistently denied this.

The customers are also expected to be asked to testify about their previous buying decisions, their experiences in upgrading enterprise resource planning software and, possibly, their future IT investment plans.

It is thought the testimony of PeopleSoft users will be crucial to the DoJ’s case. Oracle lawyers will likely seek to undermine their arguments under cross-examination by insisting their software investments will be unaffected by the merger.

The DoJ is opposing Oracle’s hostile $7.7 billion bid on the grounds that organisations will suffer from a reduction in competition in the high-end business software market.

The case, which is being held at the US district court in San Francisco, is scheduled to begin on 7 June 2004.

But there are growing fears of a delay after it emerged that some witnesses’ depositions, including that of Oracle CEO Larry Ellison, have still not taken place.

Oracle and the DoJ can each call up to 25 witnesses. The respective witness lists of both sides, released this week, make fascinating reading.

As well as a number of key PeopleSoft customers, the DoJ plans to call senior figures from the IT industry including Nancy Thomas of IBM Global Services and Richard Bergquist, PeopleSoft’s chief technology officer.

Oracle’s witness list includes IBM’s top software executive, Steve Mills, and Siebel Systems executive vice president David Schmaier.

Somewhat bizarrely, both sides in the case also plan to call different Microsoft executives.

The DoJ will call Douglas Burgum of Microsoft Business Solutions, while Oracle will call Cindy Bates, Microsoft’s general manager for sales to small and medium-sized enterprises.

Microsoft stands to play a pivotal role in the trial. Oracle believes that Microsoft plans eventually to offer high-end business software, in competition with itself and Germany’s SAP, although Microsoft, to PeopleSoft’s delight, has recently played down this notion.

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Ben Rossi

Ben was Vitesse Media's editorial director, leading content creation and editorial strategy across all Vitesse products, including its market-leading B2B and consumer magazines, websites, research and...

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