A US court has ordered SAP to pay rival Oracle $1.3 billion in damages for the theft of intellectual property by its now-defunct subsidiary TommorrowNow.
The fine is significantly higher than the $160 million that SAP has set aside to cover the cost of the case, and will have a significant impact on the company’s financial performance this year. At $691 million, the company’s profit for the last financial quarter was around half the fine.
Earlier this year, SAP admitted that TomorrowNow employees had illegally accessed sensitive information relating to Oracle’s products and services.
SAP’s co-CEO Bill McDermott said in court that he was sorry the TomorrowNow employees had not been subjected to greater control. "They were doing things that required much closer scrutiny," he said.
TomorrowNow used to provide support services for customers of applications provider PeopleSoft, which Oracle acquired in 2004. SAP bought the company in 2005, but shut it down in 2008 after Oracle accused it of IP theft.
The trial has captured the attention of the IT industry, and has involved some of its biggest names. At one point it was reported that Oracle had hired a private investigator to discover the whereabouts of Leo Apotheker, who was CEO of SAP when the charges were brought and who has since become CEO of Hewlett-Packard. Oracle CEO Larry Ellison alleged that Apotheker knew about the theft, and wished to issue him with a subpoena. Apotheker was in Japan at the time.