Oracle Sues SAP, Claiming Rival Stole Software Secrets

Oracle says SAP has been building a library of Oracle's code. (By Paul Sakuma -- Associated Press)

Oracle sued SAP yesterday, accusing its business-software rival of hacking into its computers to steal secret product information.

The complaint, filed in a San Francisco federal court, alleges that SAP, of Germany, resorted to high-tech skullduggery in an attempt to maintain its market leadership in business administration software.

Oracle, of Redwood Shores, Calif., has spent more than $20 billion on acquisitions over three years in an attempt to grab more of the market.

As part of SAP's counterattack, the suit alleges, it has been illegally building a library of Oracle's computer coding so it can woo away some of Oracle's customers. "This theft appears to be an essential -- and illegal -- part of SAP's competitive strategy against Oracle," the complaint says.

SAP was still reviewing the lawsuit and had no comment, spokesman Steve Bauer said.

Oracle alleges that most of the clandestine activity was carried out by TomorrowNow, a Texas software support service that SAP bought in 2005, shortly after Oracle completed its first big takeover with an $11 billion acquisition of PeopleSoft.

TomorrowNow was formed by a group of former PeopleSoft engineers, and Oracle alleges that TomorrowNow -- with about 150 employees -- couldn't match the technological prowess of Oracle's 15,000 workers.

To help compensate, Oracle alleges, TomorrowNow broke into its computers last year to make more than 10,000 illegal downloads of material about the copyrighted software that Oracle bought in the PeopleSoft deal. As part of its subterfuge, the lawsuit alleges, users on TomorrowNow computers posed as Oracle customers, including Honeywell International.