Oracle Corporation et al v. SAP AG et al
Filing
1206
Declaration of Nargues Motamed in Support of 1202 Statement Joint Statement in Support of Evidentiary Issues filed byOracle International Corporation. (Attachments: # 1 Exhibit A-0059, # 2 Exhibit A-6329-1, # 3 Exhibit A-0367, # 4 Exhibit A-5042, # 5 Exhibit A-5997, # 6 Exhibit A-6042-1, # 7 Exhibit A-6205-1, # 8 Exhibit A-5193, # 9 Exhibit A-5995, # 10 Exhibit A-5058, # 11 Exhibit A-5002-1, # 12 Exhibit A, # 13 Exhibit B, # 14 Exhibit C, # 15 Exhibit D, # 16 Exhibit E, # 17 Exhibit F, # 18 Exhibit G, # 19 Exhibit H, # 20 Exhibit I, # 21 Exhibit J, # 22 Exhibit K, # 23 Exhibit L, # 24 Exhibit M, # 25 Exhibit N, # 26 Exhibit PTX 0008, # 27 Exhibit PTX 0014, # 28 Exhibit PTX 0161, # 29 Exhibit O, # 30 Exhibit P, # 31 Exhibit Q, # 32 Exhibit R, # 33 Exhibit PTX 4809, # 34 Exhibit PTX 4819, # 35 Exhibit PTX 0012, # 36 Exhibit PTX 0024, # 37 Exhibit PTX 0960, # 38 Exhibit PTX 7028, # 39 Exhibit S, # 40 Exhibit T, # 41 Exhibit U, # 42 Exhibit V, # 43 Exhibit W, # 44 Exhibit PTX 8040, # 45 Exhibit PTX 2582, # 46 Exhibit X, # 47 Exhibit Y, # 48 Exhibit PTX 8112, # 49 Exhibit PTX 8111, # 50 Exhibit PTX 8108)(Related document(s) 1202 ) (Howard, Geoffrey) (Filed on 8/2/2012)
<![CDATA[
3. SAP’s TomorrowNow Acquisition Goals / Competition With
Oracle
55. Disrupting Oracle’s business was a primary goal of SAP’s acquisition of
TomorrowNow. A few days after the emails discussing TomorrowNow as an
acquisition candidate in mid‐December 2004, John Zepecki, SAP Senior Vice
President of Development, communicated SAP’s “PeopleSoft 1‐2‐3” plan on
December 21, 2004 to Shai Agassi.134 Later, in January 2005, this plan is
distributed more widely by Mr. Zepecki to Arlen Shenkman, James Mackey
and other SAP employees.135 This plan addressed the three steps SAP would
take “to disrupt Oracle’s software maintenance business and ultimately
capture Peoplesoft customers as SAP customers:” 1) provide current SAP
customers PeopleSoft support, 2) drive incremental revenue through
composite applications and 3) upgrade PeopleSoft customers to mySAP
ERP.136 The plan also states that, “Even if SAP does not convert all Peoplesoft
customers, SAP may force Oracle to change its behavior or plans around
pricing or positioning.”137
56. Leo Apotheker, SAP Executive Board Member and Co‐CEO, testified that he
wanted the TomorrowNow deal to close as a way to “inflict some pain on
SAP email from Arlen Shenkman to James Mackey Re: Peoplesoft 1‐2‐3, SAP‐OR00091723‐1728 (Shenkman
Exhibit 210), at 725‐727.
134
135 SAP email from John Zepecki to Arlen Shenkman and other SAP personnel Re; TomorrowNow/PSFT related
background info with attached document “Peoplesoft 1‐2‐3 01 05 05.doc”, SAP‐OR00004991‐5007 (Shenkman Exhibit
225), at 991.
SAP email from John Zepecki to Arlen Shenkman and other SAP personnel Re; TomorrowNow/PSFT related
background info with attached document “Peoplesoft 1‐2‐3 01 05 05.doc”, SAP‐OR00004991‐5007 (Shenkman Exhibit
225), at 998‐003.
136
SAP email from John Zepecki to Arlen Shenkman and other SAP personnel Re; TomorrowNow/PSFT related
background info with attached document “Peoplesoft 1‐2‐3 01 05 05.doc”, SAP‐OR00004991‐5007 (Shenkman Exhibit
225), at 998.
137
Page 39 of 281
Subject to Protective Order
Highly Confidential Information – Attorneys’ Eyes Only
Oracle.”138 Henning Kagermann, SAP Executive Board Member and Co‐CEO,
testified that the TomorrowNow acquisition strategy was to “interrupt
Oracle’s acquired maintenance income stream, making it difficult for them to
invest in development of their fusion platform.”139 SAP’s acquisition of
TomorrowNow sought to: “Disrupt Oracle’s ability to pay for the [PeopleSoft]
acquisition out of cash flow; Shrink [Oracle’s] share of the application market;
Discredit [Oracle’s] efforts to create a next‐generation application platform.”140
Gerhard Oswald, SAP Executive Board Member, testified that a metric
regularly used to assess TomorrowNow’s value after the acquisition was the
amount of revenue taken from Oracle.141 Mr. Oswald also testified that up
until the eve of Oracle’s lawsuit, TomorrowNow was integral to SAP’s efforts
to attack Oracle.142
57. While SAP would benefit if customers purchased support from
TomorrowNow, converting the customer to an SAP application was the
ultimate goal.143 SAP forecasted that TomorrowNow would be providing
Deposition of Leo Apotheker (SAP Executive Board Member and Co‐CEO), October 2, 2008, pgs. 191‐192; SAP
email from Leo Apotheker to Bill McDermott Re: TomorrowNow, SAP‐OR00206525 (Apotheker Exhibit 487), at 525.
138
139 Deposition of Henning Kagermann (SAP Executive Board Member and Co‐CEO), September 25, 2008, pgs. 121‐
122; Email from Michael Wendell to Gregory McStravick Re: “CLEAR SAILING” SYLT 2005, SAP‐OR00126416‐417,
SAP‐OR00147894‐919, SAP‐OR00147924‐934, SAP‐OR00182303‐306 (Kagermann Exhibit 413), at 928.
“Safe Passage: Winning Customers and Markets From Oracle‐PeopleSoft‐J.D. Edwards,” dated January 20, 2004,
SAP‐OR00299495‐518 (Oswald Exhibit 595), at 500.
140
141 Deposition of Gerhard Oswald (SAP Executive Board Member), December 11, 2008, pg. 259; “Business Case
TomorrowNow 2006,” dated November 16, 2005, SAP‐OR00136760‐68 (Oswald Exhibit 608) at 762; “Supervisory
Board Meeting TomorrowNow Status Update,” dated February 2007, SAP‐OR00141570‐581 (Kagermann Exhibit
436), at 571; “TomorrowNow Status Update, Status: November 9, 2006,” SAP‐OR00155970‐994 (Oswald Exhibit 599),
at 974 and 982.
Deposition of Gerhard Oswald (SAP Executive Board Member), December 11, 2008, pgs. 293‐294.
142
SAP email from John Zepecki to Arlen Shenkman and other SAP personnel Re; TomorrowNow/PSFT related
background info with attached document “Peoplesoft 1‐2‐3 01 05 05.doc,” SAP‐OR00004991‐5007 (Shenkman Exhibit
225), at 997.
143
Page 40 of 281
Subject to Protective Order
Highly Confidential Information – Attorneys’ Eyes Only
support to 500 customers in 2005 and 1,000 customers in 2006.144 However,
Shai Agassi testified that SAP’s Executive Board was more interested in
converting customers to SAP software than continuing to collect support
revenues.145 SAP’s “Peoplesoft 1‐2‐3” plan indicates that, “Freezing a
Peoplesoft customer “forever” is not an end goal for SAP. SAP ultimately
wants to sell more software and upgrade a customer to mySAP.”146
58. SAP planned to provide support of PeopleSoft software until 2009, by which
point customers would be switched over to SAP software.147 Nam Bui,
TomorrowNow CFO, indicated that TomorrowNow would help “SAP take
advantage of the new enterprise software market dynamics by increasing and
accelerating defection rates from Oracle/PeopleSoft to SAP.”148 An SAP
Executive Board presentation indicates that “TomorrowNow is a strategic
investment and serves as a strategic weapon against Oracle.”149
59. Leo Apotheker testified that “[t]he acquisition of TomorrowNow was meant to
facilitate the movement of customers who so desired to moved away from
PeopleSoft ‐‐ from PeopleSoft software in that particular case to SAP.”150 SAP
144 “TomorrowNow Integration Meeting,” SAP‐OR00009794‐819 (Ziemen Exhibit 455), at 817; SAP email from
Gerhard Oswald to Shai Agassi Re: Business Case TomorrowNow with attached document “Board_BC_TNow.ppt,”
SAP‐OR00502277‐292 (Agassi Exhibit 742), at 279 and 286; Deposition of Shai Agassi (Former SAP CTO and
Executive Board Member), January 5, 2009, pgs. 344‐345.
Deposition of Shai Agassi (SAP Former Executive Board Member), January 5, 2009, pg. 310.
145
146 SAP email from John Zepecki to Arlen Shenkman and other SAP personnel with attached document “Peoplesoft
1‐2‐3 01 05 05.doc”, SAP‐OR00004991‐5007 (Shenkman Exhibit 225), at 997.
SAP email from Thomas Ziemen to Leo Apotheker Re: PeopleSoft Attack Program with attached document
“PS_Attack_Program_12_2004_V6.ppt”, SAP‐OR00253278‐301 (Ziemen Exhibit 447), at 283.
147
SAP email from Gerhard Oswald to Thomas Ziemen Re: Potential acquisition of TomorrowNow, SAP‐
OR00002890‐892 (Ziemen Exhibit 448), at 891; SAP email from Chuck Mulloy to Gerhard Oswald and other SAP
personnel with attached document “Safe Passage v6.ppt,” SAP‐OR00092046‐ 070 (Shenkman Exhibit 236), at 050.
148
“TomorrowNow Acquisition Monitoring Status Update,” dated December 1, 2006, TN‐OR00601257‐271, at 258.
149
Deposition of Leo Apotheker (SAP Executive Board Member and Co‐CEO), October 2, 2008, pg. 83.
150
Page 41 of 281
Subject to Protective Order
Highly Confidential Information – Attorneys’ Eyes Only
set a goal to convert approximately 50% of PeopleSoft and J.D. Edwards
customer installations to SAP.151 Shai Agassi testified that SAP could have
done better than 50% and could have won approximately 60% of Oracle’s
PeopleSoft business.152
60. SAP planned to charge 10% of Oracle’s license fee for basic TomorrowNow
support (less than half of what Oracle charges, 22% of the license fee) or allow
customers to upgrade to SAP standard support, which included some
advanced service options, for 17% of Oracle’s license fee.153 SAP projected this
business opportunity of obtaining maintenance, “cross‐sell” and “up‐switch”
revenue from PeopleSoft customers, for the 3 year period from 2005 through
2007, to be valued at $897 million.154 Within the first half of 2005, SAP
reported €8.5 million155 in TomorrowNow maintenance contract volume taken
away from Oracle, and TomorrowNow’s install base grew to a total of 98
“Safe Passage: Winning Customers and Markets From Oracle‐PeopleSoft‐J.D. Edwards,” dated January 20, 2004,
SAP‐OR00299495‐518 (Oswald Exhibit 595), at 500; Deposition of Shai Agassi (SAP Former Executive Board
Member), January 5, 2009, pgs. 315‐318.
151
Deposition of Shai Agassi (SAP Former Executive Board Member), January 5, 2009, pgs. 311‐312. Mr. Agassi
testified that “I thought that if Oracle would do a bad job, we could see a similar distribution of the customers as the
share of customers between SAP and Oracle.”
152
“Service Deliveries for PSFT Customers,” dated January 16, 2005, SAP‐OR 00000927‐38 (Shenkman Exhibit 234),
at 928.
153
SAP email from Thomas Ziemen to Leo Apotheker Re: PeopleSoft Attack Program with attached document
“PS_Attack_Program_12_2004_V6.ppt”, SAP‐OR00253278‐301 (Ziemen Exhibit 447), at 288. Thomas Ziemen
defined “up‐switch” as the moving of a customer off of Oracle to an SAP application, and explained “cross‐sell” as
the sale of other software components that are integrated with SAP’s NetWeaver environment (Deposition of
Thomas Ziemen (SAP Vice President of Service Solution Management), September 30, 3008, pgs. 72‐74). SAP has
admitted that the $897 million value “does not ‘project a customer’s value over the lifecycle of a customer as, for
example, it only includes assumptions for the years 2005‐2007.” [Defendants’ Ninth Amended and Supplemental
Response to Plaintiffs’ Fourth Set of Interrogatories to Defendant TomorrowNow, Inc. and Third Set of
Interrogatories to Defendants SAP AG and SAP America, Inc., Second Supplemental Response to Interrogatory 69,
pgs. 21‐22; Email from Bernd Welz to Bernd‐Michael Rumpf Re: PeopleSoft Attack Program, with attached
presentation, “A Roadmap for PSFT Customers to SAP”, SAP‐OR 00493900‐923 (Scholten Exhibit 1782), at 910].
154
$10,027,450 in year 2005, currency converted using exchange rate of $1.1797 to €1, per the SAP Annual Report for
the fiscal year ending December 31, 2005, pg.98.
155
Page 42 of 281
Subject to Protective Order
Highly Confidential Information – Attorneys’ Eyes Only
customers taken away from Oracle.156 SAP’s primary goal with
TomorrowNow was not to generate PeopleSoft software support revenues. In
fact, SAP offered TomorrowNow support for free, as a loss leader in order to
attract more customers to its Safe Passage program.157
61. The below list summarizes some of SAP’s stated reasons for acquiring
TomorrowNow.
“Disrupt Oracle’s ability to pay for the acquisition out of cash
flow; Shrink their share of the application market; discredit
their efforts to create a next‐generation application platform”
and “affecting Oracle’s ability to maintain this revenue
stream could impact the ROI assumptions of the
Oracle/PeopleSoft deal”158
“Inflict some pain on Oracle”159
“Interrupt Oracle’s acquired maintenance income stream,
making it difficult for them to invest in development of their
Fusion platform.”160
Take away Oracle’s maintenance revenue stream161
156 SAP email from Ina Daniela Weber to Christian Walter Re: Safe Passage Updates with attached documents
“Apollo Program Update_Leo.ppt” and “Safe_Passage_Update_Board_Meeting_Paris_Gerd.ppt”, SAP‐
OR00139918‐969 (Kagermann, Exhibit 418), at 958.
SAP email from Thomas Ziemen to Gerhard Oswald Re: Q1 Oracle Disruption Plan, SAP‐OR 00156241‐242
(Ziemen Exhibit 454).
157
158 SAP email from John Zepecki to Arlen Shenkman and other SAP personnel with attached document “Peoplesoft
1‐2‐3 01 05 05.doc”, SAP‐OR00004991‐5007 (Shenkman Exhibit 225), at 993 and 998; “Safe Passage: Winning
Customers and Markets From Oracle‐PeopleSoft‐J.D. Edwards,” SAP‐OR00299495‐518 (Oswald Exhibit 595), at 500.
Deposition of Leo Apotheker (SAP Executive Board Member and Co‐CEO), October 2, 2008, pgs. 191‐ 192; SAP
email from Leo Apotheker to Bill McDermott Re: TomorrowNow, SAP‐OR00206525 (Apotheker Exhibit 487), at 525.
159
Deposition of Henning Kagermann (SAP Executive Board Member and Co‐CEO), September 25, 2008, pgs. 121‐
122; SAP email from Michael Wendell to Gregory McStravick Re: “CLEAR SAILING” SYLT 2005, SAP‐OR00126416‐
417, SAP‐OR00147894‐919, SAP‐OR00147924‐934, SAP‐OR00182303‐306 (Kagermann Exhibit 413), at 928.
160
Page 43 of 281
Subject to Protective Order
Highly Confidential Information – Attorneys’ Eyes Only
Earn maintenance revenue162
“Act as a significant deal funnel for SAP’s worldwide license
salesforce”163
“Announce a dramatic, market changing PeopleSoft and J.D.
Edwards support and upgrade offering”164
Sell software licenses165
A “public relations win” to have “[t]he bragging rights for
having more PSFT customers under service than Oracle”166
Oracle’s “share price will probably go down by 10%”167
4. SAP Claimed to Provide at Least Comparable Level of
PeopleSoft/J.D. Edwards Service With TomorrowNow / Oracle’s
Software and Software and Support Materials Were Critical to
Providing This Level of Service
62. To take advantage of the fear, uncertainty, and doubt of PeopleSoft customers
resulting from Oracle’s hostile takeover as well as the fear, uncertainty and
doubt that SAP continued to generate in early 2005, SAP had to position
TomorrowNow as comparable service to Oracle. Terry Hurst, SAP Director of
Competitive Programs, testified at deposition that in marketing the Safe
161 SAP email from James Mackey to Shai Agassi Re: TomorrowNow, SAP‐OR00004915 (Shenkman Exhibit 208), at
915.
Deposition of James Mackey (SAP Vice President of Corporate Finance), July 15, 2008, pgs. 80‐81 and 319‐320.
162
163 Email from Nam Bui to Arlen Shenkman Re: Follow‐Up Items, SAP‐OR00005015‐018 (Shenkman Exhibit 223), at
017.
SAP email sent from Chuck Mulloy to Gerhard Oswald and other SAP personnel with attached document “Safe
Passage v6.ppt,” SAP‐OR00092046‐SAP‐0R00092070 (Shenkman Exhibit 236), at 050.
164
165 Email from Nam Bui to Arlen Shenkman Re: Follow‐Up Items, SAP‐OR00005015‐018 (Shenkman Exhibit 223), at
017.
Deposition of Shai Agassi (SAP Former Executive Board Member), January 5, 2009, pgs. 144‐146, 248; SAP email
from Shai Agassi to Arlen Shenkman re: TomorrowNow Financials (Confidential), SAP‐OR00004970‐972 (Shenkman
Exhibit 213), at 970; “Business Case – TomorrowNow, Inc. January 7, 2005,” SAP‐OR00004763‐771 (Shenkman
Exhibit 220), at 764 (Plattner Exhibit 1400 in native form SAP‐OR00136127 from native‐ at 132).
166
SAP email from Shai Agassi to James Mackey re: TNow, SAP‐OR00503908‐909 (Agassi Exhibit 734), at 908.
167
Page 44 of 281
Subject to Protective Order
Highly Confidential Information – Attorneys’ Eyes Only
program.678 The $632 million in license volume that SAP claims to have taken
from Oracle through September 2007 does not include the on‐going support
revenue associated with those licenses.
2.
361.
TomorrowNow’s Low Price Was Critical to Making Inroads
Into Oracle’s Customer Base
Price and total cost of ownership (“TCO”) are very important factors in a
customer’s selection of a software and support vendor.679 Keith Block,
Oracle’s Executive Vice President of Sales and Consulting in North America,
testified, “. . . by acquiring TomorrowNow, SAP created leverage, as well as –
through legitimizing TomorrowNow, and presented customers with a do step,
based on lowering that complete total TCO, and advertising that they had the
same level of service and support that Oracle would provide.”680 Juergen
Rottler, Oracle’s Executive Vice President of Oracle Customer Services, also
testified about the impact of price competition from TomorrowNow: “It was
constantly on our mind, as with the acquisition of SAP, it was the one
perceived, you know, credible alternative to our own support offering.”681
TomorrowNow documents touted the importance of its low cost support
offering. For example, a TomorrowNow “Frequently Asked Questions”
document on its Safe Passage program for J.D. Edwards mid‐market
SCHEDULE 8.U. 3Q 2007 was the latest period for which I have seen TomorrowNow and Safe Passage financial
metrics reported. However, the customer‐specific revenue data produced by Defendants confirms that
TomorrowNow and SAP enjoyed additional revenue from sales of support, licenses and other services to
TomorrowNow customers after September 2007 and through the October 2008 shutdown of TomorrowNow [See
SCHEDULES 41.U and 42.SU].
678
679 Deposition of Keith Block (Oracle Executive Vice President of Sales and Consulting in North America),
September 17, 2009, pgs. 38‐39, 139 and 154‐155; Deposition of Charles Phillips (Oracle Co‐President and Executive
Board Member), April 17, 2009, pgs. 148‐149.
Deposition of Keith Block (Oracle Executive Vice President of Sales and Consulting in North America),
September 17, 2009, pgs. 238‐239.
680
Deposition of Juergen Rottler (Oracle Executive Vice President, Oracle Customer Services), May 13, 2009, pg. 43.
681
Page 226 of 281
Subject to Protective Order
Highly Confidential Information – Attorneys’ Eyes Only
customers stated, “These customers will eventually migrate – until then, SAP
builds credibility and loyalty with the customer by providing immediate
savings.”682 A TomorrowNow advertisement stating “What will you do with
the money you save?” highlights the benefit of its offer of 50% support cost
savings.683 As testified to by several former TomorrowNow customers, the
low cost of the TomorrowNow service was an important factor, and in some
cases the most important factor, in their decision to switch to TomorrowNow
for support services.684
362.
I understand that absent its alleged misuse of Oracle’s Software and
Support Materials, TomorrowNow would not have been able to market the
ability to provide comparable or better service at a significantly lower price
than Oracle. As explained in section IV.B.4 above, SAP acknowledged that
access and use of Oracle’s proprietary Software and Support Materials was
necessary to provide the level of support that TomorrowNow offered.685
“Safe Passage Sales Brief,” SAP‐OR00042962‐967 (Hurst Exhibit 175), at 963.
682
683 Advertisement from www.Tomorrownow.com included in Plaintiff’s Responses and Objections to Defendants’
Fifth Set of Interrogatories, April 16, 2009, pg. 104.
For example, see Deposition of Mark Anderson (Travel Centers Manager of IT for PeopleSoft, SAP, BW and
Cognos Business Intelligence), June 8, 2009, pgs. 35 and 47‐49; Deposition of John Kreul (Pepsi Americas Vice
President of Applications), June 2, 2009, pgs. 47, 51, 54 and 56; Deposition of Jeffrey O’Donnell (Lexmark
International Commodity Manager), September 15, 2009, pgs. 16‐17 and 57‐58; Deposition of Steven Brazile (Sara
Lee Vice President of Application Development and Support) October 14, 2009, pgs. 85‐87; Deposition of Thomas
Bailey (Honeywell, Manager of IT and Global HR Technical Design Leader), November 12, 2009, pgs. 29‐31;
Declaration of Stefan Vilsmeier, President, On Behalf of BrainLab, Inc., July 9, 2009, pg. 3; Declaration of Richard
Ball, Director of Procurement, The Standard Register Company, November 11, 2009, pg. 3; Deposition of Tracy
Hallenberger (Baker Botts Chief Knowledge Officer), November 18, 2009, pgs. 26‐27; Deposition of Paul Cooley
(Waste Management Director of Information Technologies), November 24, 2009, pgs. 27‐28.
684
For example, see SAP email from John Zepecki to Arlen Shenkman and other SAP personnel with attached
document “PeopleSoft 1‐2‐3 01 05 05.doc,” SAP‐OR00004991‐5007 (Shenkman Exhibit 225), at 999.
685
Page 227 of 281
Subject to Protective Order
Highly Confidential Information – Attorneys’ Eyes Only
accounting purposes) the customer maintenance relationships it acquired in its
acquisitions of PeopleSoft.727
387.
Prior to the Oracle acquisition, PeopleSoft support contracts typically
provided for contractual increases whereby the annual cost of support would
“walk‐up” from a percentage of the net license price (net of discounts) to that
same percentage of the then current list price of the software.728 In June 2006,
Oracle abandoned the PeopleSoft “walk‐up” pricing approach and
implemented a standard 3% annual inflationary support fee increase for its
PeopleSoft, J.D. Edwards and Siebel support contracts, consistent with
Oracle’s standard pricing policy for its other products.729 In calculating
Oracle’s lost support revenue by customer, I have applied a 3% annual fee
increase.730
388.
In order to account for the portion of the lost support revenue related to
the Lost Customers that Oracle may have lost in the absence of
TomorrowNow due to ordinary customer attrition, I have reduced the amount
of Oracle’s lost support revenue related to the Lost Customers by applying an
estimated annual support revenue attrition rate. Historically, Oracle
experienced the following annual support revenue attrition rates:
“Oracle Corporation – Estimation of the Fair Value of Certain Assets and Liabilities of PeopleSoft, Inc. as of
December 28, 2004,” ORCL00313160‐253, at 188‐190.
727
728 Deposition of Juergen Rottler (Oracle Executive Vice President, Customer Services) May 13, 2009, pgs. 37‐38 and
52; Discussion with Gary Miller (Oracle Head of Global Business Operations, Oracle Customer Services).
Discussion with Gary Miller (Oracle Head of Global Business Operations, Oracle Customer Services); Deposition
of Juan Jones (Oracle Senior Vice President, Customer Services, North America Support), April 24, 2009, pgs. 36‐37;
Deposition of Juergen Rottler (Oracle Executive Vice President, Customer Services) May 13, 2009, pgs. 29‐30.
729
To account for the fact that the lost customer contracts have service periods that start at different times of the
year, I have kept the lost annualized support fee constant for the first partial and following first full year of the
damage period (i.e., the next 3% annual increase is not applied until the second full year of the customer’s damage
period).
730
Page 242 of 281
Subject to Protective Order
Highly Confidential Information – Attorneys’ Eyes Only
Table 13: Oracle Revenue Attrition Rates
(Q3 2006 – Q3 2009) 731
Dec 2005 –
May 2006
June 2006 –
May 2007
June 2007 –
May 2008
June 2008 –
Feb 2009
PeopleSoft
7%
5%
5%
3%
J.D. Edwards
10%
9%
5%
5%
Siebel
n/a
4%
n/a
n/a
Product Line
389.
Prior to Oracle’s acquisition, PeopleSoft experienced an average annual
revenue attrition rate of 6.3%, and had forecast annual revenue attrition for
2005 to be 2.5%.732 Prior to its acquisition by Oracle, Siebel’s customer annual
renewal rates were approximately 90% (based on the number of customers).
At the time of the acquisition, Oracle management forecast Siebel annual
revenue attrition to be 7%.733
390.
To account for support revenue attrition that Oracle would have
experienced had it made the lost support sales to the Lost Customers, I have
applied the following renewal (1‐attrition rate) rates throughout the damages
period:
SCHEDULE 34.2.
731
“Oracle Corporation – Estimation of the Fair Value of Certain Assets and Liabilities of PeopleSoft, Inc. as of
December 28, 2004,” ORCL00313160‐253, at 188‐189.
732
“Oracle Corporation – Estimation of the Fair Value of Certain Assets and Liabilities of Siebel Systems, Inc. as of
January 31, 2006,” ORCL00312747‐819, at 770‐71.
733
Page 243 of 281
Subject to Protective Order
Highly Confidential Information – Attorneys’ Eyes Only
customers stated, “These customers will eventually migrate – until then, SAP
builds credibility and loyalty with the customer by providing immediate
savings.”682 A TomorrowNow advertisement stating “What will you do with
the money you save?” highlights the benefit of its offer of 50% support cost
savings.683 As testified to by several former TomorrowNow customers, the
low cost of the TomorrowNow service was an important factor, and in some
cases the most important factor, in their decision to switch to TomorrowNow
for support services.684
362.
I understand that absent its alleged misuse of Oracle’s Software and
Support Materials, TomorrowNow would not have been able to market the
ability to provide comparable or better service at a significantly lower price
than Oracle. As explained in section IV.B.4 above, SAP acknowledged that
access and use of Oracle’s proprietary Software and Support Materials was
necessary to provide the level of support that TomorrowNow offered.685
“Safe Passage Sales Brief,” SAP‐OR00042962‐967 (Hurst Exhibit 175), at 963.
682
683 Advertisement from www.Tomorrownow.com included in Plaintiff’s Responses and Objections to Defendants’
Fifth Set of Interrogatories, April 16, 2009, pg. 104.
For example, see Deposition of Mark Anderson (Travel Centers Manager of IT for PeopleSoft, SAP, BW and
Cognos Business Intelligence), June 8, 2009, pgs. 35 and 47‐49; Deposition of John Kreul (Pepsi Americas Vice
President of Applications), June 2, 2009, pgs. 47, 51, 54 and 56; Deposition of Jeffrey O’Donnell (Lexmark
International Commodity Manager), September 15, 2009, pgs. 16‐17 and 57‐58; Deposition of Steven Brazile (Sara
Lee Vice President of Application Development and Support) October 14, 2009, pgs. 85‐87; Deposition of Thomas
Bailey (Honeywell, Manager of IT and Global HR Technical Design Leader), November 12, 2009, pgs. 29‐31;
Declaration of Stefan Vilsmeier, President, On Behalf of BrainLab, Inc., July 9, 2009, pg. 3; Declaration of Richard
Ball, Director of Procurement, The Standard Register Company, November 11, 2009, pg. 3; Deposition of Tracy
Hallenberger (Baker Botts Chief Knowledge Officer), November 18, 2009, pgs. 26‐27; Deposition of Paul Cooley
(Waste Management Director of Information Technologies), November 24, 2009, pgs. 27‐28.
684
For example, see SAP email from John Zepecki to Arlen Shenkman and other SAP personnel with attached
document “PeopleSoft 1‐2‐3 01 05 05.doc,” SAP‐OR00004991‐5007 (Shenkman Exhibit 225), at 999.
685
Page 227 of 281
Subject to Protective Order
Highly Confidential Information – Attorneys’ Eyes Only
accounting purposes) the customer maintenance relationships it acquired in its
acquisitions of PeopleSoft.727
387.
Prior to the Oracle acquisition, PeopleSoft support contracts typically
provided for contractual increases whereby the annual cost of support would
“walk‐up” from a percentage of the net license price (net of discounts) to that
same percentage of the then current list price of the software.728 In June 2006,
Oracle abandoned the PeopleSoft “walk‐up” pricing approach and
implemented a standard 3% annual inflationary support fee increase for its
PeopleSoft, J.D. Edwards and Siebel support contracts, consistent with
Oracle’s standard pricing policy for its other products.729 In calculating
Oracle’s lost support revenue by customer, I have applied a 3% annual fee
increase.730
388.
In order to account for the portion of the lost support revenue related to
the Lost Customers that Oracle may have lost in the absence of
TomorrowNow due to ordinary customer attrition, I have reduced the amount
of Oracle’s lost support revenue related to the Lost Customers by applying an
estimated annual support revenue attrition rate. Historically, Oracle
experienced the following annual support revenue attrition rates:
“Oracle Corporation – Estimation of the Fair Value of Certain Assets and Liabilities of PeopleSoft, Inc. as of
December 28, 2004,” ORCL00313160‐253, at 188‐190.
727
728 Deposition of Juergen Rottler (Oracle Executive Vice President, Customer Services) May 13, 2009, pgs. 37‐38 and
52; Discussion with Gary Miller (Oracle Head of Global Business Operations, Oracle Customer Services).
Discussion with Gary Miller (Oracle Head of Global Business Operations, Oracle Customer Services); Deposition
of Juan Jones (Oracle Senior Vice President, Customer Services, North America Support), April 24, 2009, pgs. 36‐37;
Deposition of Juergen Rottler (Oracle Executive Vice President, Customer Services) May 13, 2009, pgs. 29‐30.
729
To account for the fact that the lost customer contracts have service periods that start at different times of the
year, I have kept the lost annualized support fee constant for the first partial and following first full year of the
damage period (i.e., the next 3% annual increase is not applied until the second full year of the customer’s damage
period).
730
Page 242 of 281
Subject to Protective Order
Highly Confidential Information – Attorneys’ Eyes Only
Table 13: Oracle Revenue Attrition Rates
(Q3 2006 – Q3 2009) 731
Dec 2005 –
May 2006
June 2006 –
May 2007
June 2007 –
May 2008
June 2008 –
Feb 2009
PeopleSoft
7%
5%
5%
3%
J.D. Edwards
10%
9%
5%
5%
Siebel
n/a
4%
n/a
n/a
Product Line
389.
Prior to Oracle’s acquisition, PeopleSoft experienced an average annual
revenue attrition rate of 6.3%, and had forecast annual revenue attrition for
2005 to be 2.5%.732 Prior to its acquisition by Oracle, Siebel’s customer annual
renewal rates were approximately 90% (based on the number of customers).
At the time of the acquisition, Oracle management forecast Siebel annual
revenue attrition to be 7%.733
390.
To account for support revenue attrition that Oracle would have
experienced had it made the lost support sales to the Lost Customers, I have
applied the following renewal (1‐attrition rate) rates throughout the damages
period:
SCHEDULE 34.2.
731
“Oracle Corporation – Estimation of the Fair Value of Certain Assets and Liabilities of PeopleSoft, Inc. as of
December 28, 2004,” ORCL00313160‐253, at 188‐189.
732
“Oracle Corporation – Estimation of the Fair Value of Certain Assets and Liabilities of Siebel Systems, Inc. as of
January 31, 2006,” ORCL00312747‐819, at 770‐71.
733
Page 243 of 281
Subject to Protective Order
Highly Confidential Information – Attorneys’ Eyes Only
429.
As explained above, I have applied a 10% discount rate to OEMEAs lost
profits extending beyond November 2010. Based on this plaintiff entity‐
specific approach, OEMEA has experienced lost profits of $41.0 million on lost
support revenue through May 2015, and $9.0 million on support revenue lost
during the period for which TomorrowNow provided support service to the
Lost Customers.796 Net of sublicense fees paid to OFS, OEMEA has
experienced lost profits of $14.1 million on lost support revenue through May
2015, and $4.3 million on support revenue lost during the period for which
TomorrowNow provided support service to the Lost Customers.797
iii.
430.
OIC’s Lost Profits
OIC’s business is to license its technology to other Oracle affiliates.798 As
described above, OIC’s revenue is comprised of intercompany sublicense fees
received from its license and distribution agreements with other Oracle
entities. Given the nature of OIC’s operations, it would be expected that it
would have minimal incremental costs associated with earning additional
sublicense fees on support sales to the Lost Customers.
431.
I have obtained and reviewed the detailed income statements for the
Product Support and License Updates line of business of OIC for the periods
of Oracle’s fiscal year 2006 through the second fiscal quarter of 2009.799 In
calculating OIC’s incremental cost of support, I have included “Intercompany
SCHEDULES 39.SU and 39.1.SU.
796
SCHEDULES 39.SU and 39.1.SU.
797
Deposition of Ann Kishore (Oracle Director of Tax Department, Mergers and Acquisitions), April 14, 2009, pgs.
39‐40. I understand that OIC also provides support services to the Latin American region through designees.
Activity recorded in company code 35B – Latin America Fiscal Recharges relates to expense charges for those
activities [Deposition of Ann Kishore (Oracle Director of Tax Department, Mergers and Acquisitions), September 25,
2009, pgs. 329‐330; Discussion with Ann Kishore].
798
ORCL00694040, DIS Support Total 110909.xls
799
Page 263 of 281
Subject to Protective Order
Highly Confidential Information – Attorneys’ Eyes Only
License Sublicense Fee Expense,” “Intercompany Technology Costs Expense”
and the “Line of Business (LOB) Charges” recorded for the 35B Latin America
Fiscal Recharge company code.800 During this time period, OIC reported
annual incremental profit margins on its support sublicense fee income of 94%
to 96% (incremental cost of 4% to 6%).801 In calculating OIC’s lost profits
damages, I have applied an incremental margin percentage of 95% (5%
incremental costs) across all periods.
432.
As explained above, I have applied a 10% discount rate to OIC’s lost
profits extending beyond November 2010. Based on this plaintiff entity‐
specific approach, OIC has experienced lost profits of $121.1 million on lost
support revenue through May 2015, and $37.0 million on support revenue lost
during the period for which TomorrowNow provided support service to the
Lost Customers.802
D.
433.
Opinion: Summary of Oracle’s Lost Profits
As a result of the Defendants’ alleged bad acts, it is my opinion that
Oracle has experienced lost profits on support revenue lost to TomorrowNow,
as summarized in the following table.
800 I have included all expenses recorded for OIC’s Product Support and License Updates line of business, except for
the “Intercompany Fiscal Recharge Markup Expense” recorded in company code 35B. This expense is for a 10%
markup on the Line of Business expenses that are charged to OIC by its designees that provide support services on
OIC’s behalf [Discussion with Claire Sebti (Oracle Senior Director of Corporate Accounting)]. This markup relates
to an intercompany profit margin, rather than an actual cost to provide support services, and is therefore not
relevant to the incremental cost to service a customer.
SCHEDULE 40.2.
801
SCHEDULES 40.SU and 40.1.SU. Including sublicense fee profit received by ORC and OTC, OIC’s lost profits
related to the Lost Customers is $153.8 million through May 2015, and $42.2 million during the period in which the
Lost Customers received support, services from TomorrowNow.
802
Page 264 of 281
Subject to Protective Order
Highly Confidential Information – Attorneys’ Eyes Only
refunds and/or settlement payments paid to customers upon the shutdown of
TomorrowNow in 2008.809
438.
According to the customer‐level revenue data produced by Defendants,
excluding the reductions in revenue for settlement payments made to
customers due to TomorrowNow’s shutdown due to this litigation,
TomorrowNow received $54.1 million in revenue since 2002, $48.5 million
(90%) of which was received since TomorrowNow was acquired by SAP in
January 2005.810 Net of revenue reductions for settlement payments made,
TomorrowNow received $41 million in net revenue from the Relevant
TomorrowNow Customers since 2002, $35.4 million of which was received
since it was acquired by SAP in January 2005.811
C.
439.
Defendants’ Unjust Enrichment – Revenue from Sales of Other SAP
Products and Services
As explained in section IV.B.3 above, TomorrowNow was an integral
part of SAP’s Safe Passage program, the goal of which was to capture Oracle’s
PeopleSoft and J.D. Edwards customers and convert them to SAP
applications.812 The third step and ultimate goal of SAP’s “PeopleSoft 1‐2‐3”
plan was to convert PeopleSoft customers to SAP applications.813 An SAP
809 See negative entries in the file: TN‐OR06125333, TN Customer Report‐Revised.xls. The amount of the refunds
and settlements paid to TomorrowNow customers is also shown at “TomorrowNow Operations Wind Down: Final
Report,” TN‐OR0352871‐924 (Brandt Exhibit 535), at 891‐899.
SCHEDULE 41.U. $15.7 million of the $54.1 million in revenue relates to Relevant TN Customers that were
excluded from the calculation of Oracle’s lost profits.
810
811 SCHEDULE 41.U. $13.9 million of the $41 million in revenue relates to Relevant TN Customers that were excluded
from the calculation of Oracle’s lost profits.
SAP AG Annual Report, for the year ended December 31, 2005, pgs. 2 and 66; SAP email sent from Chuck Mulloy
to Gerhard Oswald and other SAP personnel, dated January 17, 2005, with attached document “Safe Passage
v6.ppt,” SAP‐OR00092046‐070 (Shenkman Exhibit 236), at 048 and 050.
812
SAP email from John Zepecki to Arlen Shenkman and other SAP personnel, dated January 5, 2005, with attached
document “Peoplesoft 1‐2‐3 01 05 05.doc,” SAP‐OR00004991‐5007 (Shenkman Exhibit 225), at 997 and 003.
813
Page 268 of 281
Subject to Protective Order
Highly Confidential Information – Attorneys’ Eyes Only
document states, “Freezing a PeopleSoft customer ‘forever’ is not an end goal
for SAP. SAP ultimately wants to sell more software and upgrade a customer
to mySAP.”814 SAP’s goal was to convert 50% of Oracle’s PeopleSoft and J.D.
Edwards customers to SAP.815 SAP’s primary goal of extending
TomorrowNow support services to Oracle’s Siebel product line was to get
those Siebel customers to switch to SAP’s CRM software.816 In an effort to
achieve these goals, SAP offered TomorrowNow service as a loss leader in
order to gain more Safe Passage program customers.817
440.
SAP’s TomorrowNow support offering served as an enabler for SAP to
win more customers from Oracle. SAP did not have a comparable offering (to
provide support service to Oracle’s customer base) either before it acquired or
after it shutdown TomorrowNow’s operations.818 Through its operation of
TomorrowNow’s alleged business model, Defendants have benefited
financially from the sales of other SAP products and services to certain of the
Relevant TomorrowNow Customers.
814 SAP email from John Zepecki to Arlen Shenkman and other SAP personnel, dated January 5, 2005, with attached
document “Peoplesoft 1‐2‐3 01 05 05.doc,” SAP‐OR00004991‐5007 (Shenkman Exhibit 225), at 997.
“Safe Passage: Winning Customers and Markets From Oracle‐PeopleSoft‐J.D. Edwards,” SAP‐OR00299495‐518
(Oswald Exhibit 595), at 500; Deposition of Shai Agassi (Former SAP CTO and Executive Board Member), January 5,
2009, pgs. 315‐318.
815
Deposition of Terry Hurst (SAP Director of Competitive Programs), September 10, 2009, pgs. 503‐504.
816
Email from Thomas Zieman to Gerhard Oswald, dated July 31, 2006, Re: Q1 Oracle Disruption Plan, SAP‐
OR00156241‐242 (Ziemen Exhibit 454). See also, Deposition of Paul Cooley (Waste Management Director of
Information Technologies), November 24, 2009, pgs. 34‐39, who testified that the total cost of ownership was a
deciding factor in Waste Management’s decision to switch to TomorrowNow/SAP.
817
Deposition of Keith Block (Oracle Executive Vice President of Sales and Consulting in North America),
September 17, 2009, pgs. 238‐240.
818
Page 269 of 281
Subject to Protective Order
Highly Confidential Information – Attorneys’ Eyes Only
1.
441.
SAP Positions and Claims Regarding Safe Passage Success
and Revenues
In December 2004, Thomas Ziemen sent an email to several SAP
Executive Board members attaching a presentation containing slides about a
“PeopleSoft Attack Program.” The slides indicate that the SAP Business
Opportunity included revenues from “maintenance” of PeopleSoft products,
“upswitch” of replacing PeopleSoft products with SAP products and “cross‐
sell” of selling customers other SAP products.819 Reports on TomorrowNow’s
financial results indicated that support revenue won by TomorrowNow was
not the full extent of value for SAP. For example, a June 20, 2006 SAP
presentation titled “CEO Council – Post Merger Integration (PMI)” includes a
slide titled “Financial Scorecard – TomorrowNow (Stand Alone),” which
indicates that “When conducting a financial review for TomorrowNow the
following two aspects have to be considered: 1) TomorrowNow on a Stand‐
Alone basis, as well as 2) Safe Passage implications.”820 That same June 20,
2006 presentation contains a slide titled “TomorrowNow – Creation of Safe
Passage,” which reports:
“Safe passage pipeline (752 opportunities) and Revenues
justify the cost of the [TomorrowNow] acquisition and
additional operating expenses;”
Email and from Thomas Ziemen to Leo Apotheker and others dated December 23, 2004, Re: PeopleSoft Attack
Program with (Ziemen Ex. 447) PS_Attack_Prog attachment, SAP‐OR00253278‐301, at 288‐290; Deposition of
Thomas Ziemen (SAP Vice President, Service Solution Management), September 30, 2008, pgs. 72‐76. “Upswitch”
relates to the conversion of a PeopleSoft or J.D. Edwards customer to SAP applications, while “cross‐sell” relates to
the sale of other software components that are integrated in the SAP NetWeaver environment [Deposition of
Thomas Ziemen, September 30, 2008, pgs. 72‐74].
819
CEO Council Post Merger Integration (PMI) dated June 20, 2006, SAP‐OR00097329‐364 (Oswald Exhibit 606), at
344.
820
Page 270 of 281
Subject to Protective Order
Highly Confidential Information – Attorneys’ Eyes Only
License Sublicense Fee Expense,” “Intercompany Technology Costs Expense”
and the “Line of Business (LOB) Charges” recorded for the 35B Latin America
Fiscal Recharge company code.800 During this time period, OIC reported
annual incremental profit margins on its support sublicense fee income of 94%
to 96% (incremental cost of 4% to 6%).801 In calculating OIC’s lost profits
damages, I have applied an incremental margin percentage of 95% (5%
incremental costs) across all periods.
432.
As explained above, I have applied a 10% discount rate to OIC’s lost
profits extending beyond November 2010. Based on this plaintiff entity‐
specific approach, OIC has experienced lost profits of $121.1 million on lost
support revenue through May 2015, and $37.0 million on support revenue lost
during the period for which TomorrowNow provided support service to the
Lost Customers.802
D.
433.
Opinion: Summary of Oracle’s Lost Profits
As a result of the Defendants’ alleged bad acts, it is my opinion that
Oracle has experienced lost profits on support revenue lost to TomorrowNow,
as summarized in the following table.
800 I have included all expenses recorded for OIC’s Product Support and License Updates line of business, except for
the “Intercompany Fiscal Recharge Markup Expense” recorded in company code 35B. This expense is for a 10%
markup on the Line of Business expenses that are charged to OIC by its designees that provide support services on
OIC’s behalf [Discussion with Claire Sebti (Oracle Senior Director of Corporate Accounting)]. This markup relates
to an intercompany profit margin, rather than an actual cost to provide support services, and is therefore not
relevant to the incremental cost to service a customer.
SCHEDULE 40.2.
801
SCHEDULES 40.SU and 40.1.SU. Including sublicense fee profit received by ORC and OTC, OIC’s lost profits
related to the Lost Customers is $153.8 million through May 2015, and $42.2 million during the period in which the
Lost Customers received support, services from TomorrowNow.
802
Page 264 of 281
Subject to Protective Order
Highly Confidential Information – Attorneys’ Eyes Only
refunds and/or settlement payments paid to customers upon the shutdown of
TomorrowNow in 2008.809
438.
According to the customer‐level revenue data produced by Defendants,
excluding the reductions in revenue for settlement payments made to
customers due to TomorrowNow’s shutdown due to this litigation,
TomorrowNow received $54.1 million in revenue since 2002, $48.5 million
(90%) of which was received since TomorrowNow was acquired by SAP in
January 2005.810 Net of revenue reductions for settlement payments made,
TomorrowNow received $41 million in net revenue from the Relevant
TomorrowNow Customers since 2002, $35.4 million of which was received
since it was acquired by SAP in January 2005.811
C.
439.
Defendants’ Unjust Enrichment – Revenue from Sales of Other SAP
Products and Services
As explained in section IV.B.3 above, TomorrowNow was an integral
part of SAP’s Safe Passage program, the goal of which was to capture Oracle’s
PeopleSoft and J.D. Edwards customers and convert them to SAP
applications.812 The third step and ultimate goal of SAP’s “PeopleSoft 1‐2‐3”
plan was to convert PeopleSoft customers to SAP applications.813 An SAP
809 See negative entries in the file: TN‐OR06125333, TN Customer Report‐Revised.xls. The amount of the refunds
and settlements paid to TomorrowNow customers is also shown at “TomorrowNow Operations Wind Down: Final
Report,” TN‐OR0352871‐924 (Brandt Exhibit 535), at 891‐899.
SCHEDULE 41.U. $15.7 million of the $54.1 million in revenue relates to Relevant TN Customers that were
excluded from the calculation of Oracle’s lost profits.
810
811 SCHEDULE 41.U. $13.9 million of the $41 million in revenue relates to Relevant TN Customers that were excluded
from the calculation of Oracle’s lost profits.
SAP AG Annual Report, for the year ended December 31, 2005, pgs. 2 and 66; SAP email sent from Chuck Mulloy
to Gerhard Oswald and other SAP personnel, dated January 17, 2005, with attached document “Safe Passage
v6.ppt,” SAP‐OR00092046‐070 (Shenkman Exhibit 236), at 048 and 050.
812
SAP email from John Zepecki to Arlen Shenkman and other SAP personnel, dated January 5, 2005, with attached
document “Peoplesoft 1‐2‐3 01 05 05.doc,” SAP‐OR00004991‐5007 (Shenkman Exhibit 225), at 997 and 003.
813
Page 268 of 281
Subject to Protective Order
Highly Confidential Information – Attorneys’ Eyes Only
document states, “Freezing a PeopleSoft customer ‘forever’ is not an end goal
for SAP. SAP ultimately wants to sell more software and upgrade a customer
to mySAP.”814 SAP’s goal was to convert 50% of Oracle’s PeopleSoft and J.D.
Edwards customers to SAP.815 SAP’s primary goal of extending
TomorrowNow support services to Oracle’s Siebel product line was to get
those Siebel customers to switch to SAP’s CRM software.816 In an effort to
achieve these goals, SAP offered TomorrowNow service as a loss leader in
order to gain more Safe Passage program customers.817
440.
SAP’s TomorrowNow support offering served as an enabler for SAP to
win more customers from Oracle. SAP did not have a comparable offering (to
provide support service to Oracle’s customer base) either before it acquired or
after it shutdown TomorrowNow’s operations.818 Through its operation of
TomorrowNow’s alleged business model, Defendants have benefited
financially from the sales of other SAP products and services to certain of the
Relevant TomorrowNow Customers.
814 SAP email from John Zepecki to Arlen Shenkman and other SAP personnel, dated January 5, 2005, with attached
document “Peoplesoft 1‐2‐3 01 05 05.doc,” SAP‐OR00004991‐5007 (Shenkman Exhibit 225), at 997.
“Safe Passage: Winning Customers and Markets From Oracle‐PeopleSoft‐J.D. Edwards,” SAP‐OR00299495‐518
(Oswald Exhibit 595), at 500; Deposition of Shai Agassi (Former SAP CTO and Executive Board Member), January 5,
2009, pgs. 315‐318.
815
Deposition of Terry Hurst (SAP Director of Competitive Programs), September 10, 2009, pgs. 503‐504.
816
Email from Thomas Zieman to Gerhard Oswald, dated July 31, 2006, Re: Q1 Oracle Disruption Plan, SAP‐
OR00156241‐242 (Ziemen Exhibit 454). See also, Deposition of Paul Cooley (Waste Management Director of
Information Technologies), November 24, 2009, pgs. 34‐39, who testified that the total cost of ownership was a
deciding factor in Waste Management’s decision to switch to TomorrowNow/SAP.
817
Deposition of Keith Block (Oracle Executive Vice President of Sales and Consulting in North America),
September 17, 2009, pgs. 238‐240.
818
Page 269 of 281
Subject to Protective Order
Highly Confidential Information – Attorneys’ Eyes Only
(
'
&
¥
¤
"
¥
%
£
S
c
S
c
S
c
S
c
S
c
S
c
S
c
6
b
C
9
)
9
Y
6
Y
T
C
6
Q
W
g
f
B
c
B
6
g
Q
c
g
7
A
@
b
C
7
U
W
6
Q
W
c
9
7
9
6
h
V
B
U
B
6
c
q
`
c
v
u
x
p
h
v
v
h
x
m
k
b
a
b
q
a
b
d
R
a
a
Y
q
p
b
U
b
A
a
p
Y
7
W
a
a
Y
R
T
7
T
C
X
U
R
U
j
B
c
5
Y
W
B
b
`
`
6
`
6
q
g
`
5
W
q
Y
q
6
6
T
C
9
T
p
Y
6
f
c
a
X
X
a
Y
W
a
p
d
`
a
Y
`
a
p
Y
p
a
d
X
Y
T
`
d
q
R
a
Y
X
d
a
d
Q
T
p
Y
p
a
d
Q
a
S
T
`
R
S
T
X
Y
`
X
V
Q
S
a
W
U
S
S
R
T
`
Y
`
R
a
6
D
6
C
@
4
©
#
¨
X
U
3
Y
W
W
Y
a
X
X
2
B
¡
§
`
Q
U
U
a
7
@
6
"
¡
9
8
¡
§
7
§
6
¥
¢
Y
X
T
R
`
4
!
¥
¥
3
¨
Y
W
0
}
x
R
w
v
k
n
j
z
|
m
h
k
q
y
x
m
{
p
u
h
z
o
n
n
j
j
x
i
h
h
q
j
n
k
y
x
m
k
l
k
w
j
j
v
u
i
h
t
g
s
n
f
e
r
d
Q
u
6
t
f
e
H
G
6
F
f
e
q
W
I
G
F
f
e
H
c
S
T
6
q
W
I
T
U
Q
S
S
h
W
V
H
R
T
T
V
R
Q
S
S
S
W
W
U
S
g
d
T
V
V
S
T
I
c
S
W
Q
`
T
W
1
¡
G
g
6
F
f
e
d
S
R
Q
I
I
H
G
F
)
¥
I
R
T
T
I
T
V
Q
S
h
X
R
S
T
6
Q
X
2
q
W
I
S
X
X
V
S
T
W
Q
Y
T
5
¤
g
d
T
V
V
U
T
W
T
R
a
Y
A
¢
¨
Q
S
S
c
S
X
Q
`
S
X
q
Y
i
Q
`
P
9
¡
g
R
T
T
T
V
Q
T
X
Y
q
a
6
W
p
T
U
`
Y
W
a
Y
Y
q
a
Y
p
`
d
d
q
Q
q
a
Y
p
a
U
Y
W
a
p
a
Y
d
`
d
Y
a
Y
a
2
¢
x
c
S
`
`
y
h
T
V
V
`
Q
`
`
R
T
U
V
S
X
Y
U
T
p
d
S
`
Y
p
T
d
T
a
h
p
Y
R
Q
p
6
Y
Q
U
W
Y
d
U
U
Y
U
a
Y
`
U
b
X
b
E
§
g
6
U
W
X
p
Y
W
a
s
b
b
b
b
b
Q
T
U
p
S
Q
S
¥
~
m
W
B
d
Y
X
T
j
5
U
b
S
c
Y
S
c
r
a
a
a
a
a
c
a
c
4
$
§
¥
£
¥
¥
¤
¦
¥
¦
¥
©
¨
§
¢
¡
¦
¡
£
¥
¤
£
¢
¡
´
¯
¶
¶
¯
¤
¯
³±
¤
¢
¯
¯
¯
¢
¢
¢
±
ª
d
©
¬
§
¸
·
¡
¡
µ
¥
¡
°
²
¬
¥
¡
¨
°¥
®
¬
«
¥
H
H
¦
¤
¢
¤
¤
¢
¨
§
¥
¡
¡
£
¡
¡
d
d
R
f
f
S
T
g
R
T
y
B
e
g
g
g
d
f
f
f
f
f
d
f
T
Q
g
e
T
e
T
G
C
G
C
H
H
T
S
Q
R
Q
Q
R
e
e
C
C
G
A
C
C
r
dW
c
`
e
s
v
c
h
e
c
h
Y
Y
fW
cW
d
Y
G
D
G
j
j
m
m
u
b
a
q
j
s
m
p
o
n
l
b
q
b
q
e
c
h
Y
fW
cW
d
Y
u
b
a
j
j
h
e
Y
r
r
e
h
Y
fW
cW
d
u
b
t
m
s
r
n
p
m
b
w
u
b
a
j
j
j
f
g
e
m
m
s
r
n
p
m
d
S
T
I
I
D
G
I
E
E
R
j
r
r
e
h
e
c
Y
e
d
Y
Y
h
r
vW
c
h
rW
Y
Wg
W
~
fW
e
d
Y
c
W
b
w
u
t
u
u
b
u
w
p
}
|
a
{
u
b
y
S
e
R
x
g
e
R
g
R
g
G
G
D
G
A
G
A
G
G
G
D
G
D
G
G
D
G
D
G
H
G
D
G
A
G
F
G
D
G
D
j
j
j
j
j
j
j
j
j
j
j
j
j
j
j
q
k
r
m
l
p
n
o
m
i
p
l
l
q
m
i
n
l
o
m
p
n
h
o
m
q
q
p
H
P
D
I
E
E
E
E
E
E
E
E
E
E
E
E
z
z
z
z
z
z
z
z
z
z
z
z
m
m
m
m
m
m
m
m
m
m
m
m
m
E
E
E
E
E
E
E
E
E
E
E
E
E
E
d
S
T
E
E
E
E
E
E
E
E
E
E
E
E
E
E
R
d
rW
Y
Wg
~
r
r
e
i
v
e
e
Y
d
W
i
Y
h
g
f
e
}
b
w
u
u
t
j
z
z
z
z
z
z
z
z
z
z
z
z
z
z
f
g
e
o
m
m
m
m
m
m
m
m
m
m
m
m
m
m
E
E
E
E
E
E
E
E
E
E
E
E
E
E
d
S
T
E
E
E
E
E
E
E
E
E
E
E
E
E
E
R
P
d
~
rW
Y
gW
W
W
rW
Y
dW
`
Wr
Y
Wd
i
Y
h
g
f
e
W
}
v
q
u
t
s
q
p
a
b
r
r
e
h
Y
fW
cW
d
Y
b
w
u
b
a
j
j
j
j
j
j
j
j
j
j
j
j
j
j
Y
XW
h
e
W`
W
E
E
z
m
E
E
E
j
h
o
q
m
h
l
i
l
n
m
r
s
n
i
n
m
h
r
o
r
k
m
l
E
E
z
m
E
E
z
z
m
m
E
E
E
E
E
j
o
q
q
h
l
k
l
n
o
q
p
h
I
P
H
n
k
r
G
F
E
E
E
E
E
E
E
E
E
E
R
k
h
p
o
i
s
m
k
q
k
r
l
m
s
j
j
W
d
fW
e
d
Y
r
r
e
i
v
e
e
Y
d
i
Y
h
g
f
e
a
b
w
u
u
t
w
x
y
j
j
j
j
j
j
j
j
j
j
f
g
e
z
H
E
x
m
H
H
A
A
C
P
D
j
j
j
s
o
m
i
k
n
p
k
m
h
l
r
l
l
m
k
p
k
h
l
m
o
k
p
r
l
m
h
q
h
o
h
p
m
n
o
l
p
l
m
o
i
o
n
h
m
l
n
h
i
h
m
l
l
k
i
h
m
r
l
s
q
m
m
i
h
i
q
E
E
C
H
A
I
P
C
H
A
j
j
R
G
U
C
D
H
H
F
F
H
D
G
H
A
G
C
G
A
P
F
U
A
D
H
H
P
C
F
G
F
C
I
I
U
D
o
r
o
s
p
n
m
h
p
E
P
D
I
G
A
I
P
C
s
i
D
E
E
F
D
m
k
i
p
p
r
h
P
k
s
P
I
E
E
E
E
E
E
S
T
h
n
i
n
h
r
o
r
k
m
l
E
E
d
o
o
p
s
h
E
E
E
E
E
E
E
m
n
l
i
s
q
q
m
k
k
q
m
A
j
n
m
q
E
E
E
F
F
F
H
j
j
m
q
q
r
h
h
j
m
i
o
s
r
h
m
k
k
k
q
m
q
n
E
U
E
E
E
y
p
A
I
I
P
F
j
|
o
m
E
G
d
S
T
l
{
m
s
r
m
n
i
h
j
z
D
m
p
r
p
o
k
r
n
m
a
b
q
s
h
H
j
j
H
U
G
I
U
P
j
E
E
E
E
E
E
E
E
E
E
c
Y
q
I
m
p
r
p
o
m
q
l
n
p
m
E
A
P
m
m
m
m
m
m
m
m
m
m
m
q
j
j
m
n
q
n
o
m
P
P
U
A
g
e
q
m
r
k
i
l
r
m
n
n
k
i
l
m
o
n
h
o
l
P
o
i
j
H
I
m
o
l
h
l
j
q
p
D
C
C
r
j
m
s
i
i
q
o
k
h
q
j
m
k
l
h
s
r
m
q
o
n
j
z
z
z
z
z
z
z
z
z
z
f
W
q
k
i
h
V
u
b
t
q
o
m
i
k
n
p
k
m
h
l
r
l
l
m
k
p
k
h
l
m
o
k
p
r
l
m
h
q
h
o
h
p
m
n
o
l
p
l
m
o
i
o
n
h
m
l
n
h
i
h
m
l
l
m
l
o
A
D
I
U
I
G
P
C
I
U
U
H
C
G
U
P
I
G
A
P
D
U
A
A
P
A
D
P
P
C
A
C
H
A
F
D
H
G
H
P
z
m
m
c
Y
n
h
m
s
m
s
r
j
j
r
p
m
P
G
g
e
a
b
l
j
j
m
h
s
p
r
m
l
p
n
o
m
i
p
l
l
q
m
i
n
l
o
o
o
r
n
p
z
f
c
W
Y
p
q
m
q
o
k
s
n
m
h
j
j
j
j
m
p
n
h
o
m
s
p
k
h
h
m
o
h
s
o
m
o
i
h
i
q
m
h
k
s
q
m
n
s
s
j
j
q
p
l
j
j
j
j
j
l
h
h
m
o
h
s
o
m
o
i
h
i
q
m
h
k
s
q
m
n
p
q
o
h
r
i
j
j
j
j
j
j
j
j
m
o
r
n
p
n
h
k
m
n
l
r
k
o
n
p
m
i
n
q
n
l
m
r
k
l
o
l
m
o
s
q
i
l
m
i
p
l
i
l
m
o
q
i
o
s
p
m
o
s
q
q
l
m
r
l
q
h
h
m
r
s
l
l
s
y
x
R
H
R
I
P
w
I
F
A
U
U
U
F
I
F
A
U
P
F
I
U
A
H
A
P
A
I
G
P
U
I
U
P
C
P
G
A
U
G
A
C
A
U
U
F
C
A
W
fW
e
d
Y
W
rW
Y
dW
`
rW
Y
Wd
i
Y
h
g
f
e
d
c
W
Y
a
v
q
u
t
s
q
p
a
b
y
x
w
W
`W
Y
WX
V
E
E
E
E
E
E
E
E
E
E
E
E
E
E
7
82
7
6
5
2
0
@
9
4
3
1
T
S
Q
R
Q
F
C
B
H
H
F
C
B
G
F
C
B
F
F
C
B
A
T
S
Q
R
Q
F
C
B
D
F
C
B
P
F
C
B
I
U
C
B
I
H
U
C
B
H
H
U
C
B
G
U
C
B
F
U
A
C
B
A
T
S
Q
R
Q
U
C
B
D
U
C
B
P
U
C
B
I
A
C
B
I
H
A
C
B
H
H
A
C
B
G
A
C
B
F
A
C
B
A
T
S
Q
R
Q
A
C
B
D
A
C
B
P
A
C
B
I
D
C
B
I
H
D
C
B
H
H
D
C
B
G
D
C
B
F
D
C
B
E
I
G
C
C
I
I
H
F
C
C
I
U
C
C
I
A
C
C
!
#
¡
¥
¥
"
§
¥
§
&
%
$
§
¦
¡
¢
¨
¦
¡
©
¤
¢
¨
§
¥
¥
¡
£
§
¦
¥
§
¦
¥
§
¦
¤
¥
¨
¢
©
¥
§
¥
£
¦
¤
§
¢
¨
¡
©
©
¨
£
¡
©
)
(
¥
¤
¥
'
£
§
¦
¨
¢
¡
©
¡
£
¤
¢
§
¦
¨
¢
§
¡
¥
¨
§
¦
¥
¤
£
¢
¡
]]>
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?
