By Siobhan Kennedy
Attorneys for Siebel Systems Inc have sent a damning letter to Oracle Corp CEO Larry Ellison insisting that the software giant immediately cease and desist its anti-Siebel marketing campaign or face legal action, ComputerWire has learned.
In the letter, Siebel’s attorneys accused Ellison of conducting an unlawful campaign of false, deceptive and disparaging statements about Siebel Systems and its products. Over the last six months, the letter said, Oracle has resorted to increasingly desperate measures in its attempt to position itself as a credible CRM solution provider. While the attorneys said Siebel welcomed fair, honest competition, Oracle’s recent tactics are nothing of the sort.
The attack is the latest installment in the ongoing bitter and acrimonious war between the two leading software vendors. Earlier this month, ComputerWire reported that Siebel had sent a letter to Oracle’s president Ray Lane, accusing him of putting the CRM vendor on a hit list and encouraging his employees to do all they could to squeeze Siebel out of the front office market space, a fact which Oracle vehemently denies. But publicly, Oracle has time and time again stated its intention to wound Siebel, using aggressive language and threatening to kill, crush, destroy, and attack the leading CRM vendor.
The four page letter accuses Ellison of letting Oracle’s CRM strategy degenerate into a concerted attempt to inflict damage on Siebel Systems. It takes issue with a number of statements which the attorneys told Ellison you personally have made to the press and the public. Specifically, the CRM vendor objects to five main accusations. That Oracle’s is the only CRM solution to integrate web selling with call center and field sales selling; that Oracle’s CRM software is the only product in the world that can monitor sales and marketing process from initial sales prospect to ordering goods; that Siebel doesn’t have marketing or e-store capabilities. They aren’t really in the CRM business because they don’t capture orders; that Siebel requires users to mail in their laptops for Siebel upgrades and finally, that Siebel lacks marketing automation, field sales, field service, and electronic sales solutions. In every instance, the CRM vendor punctuated its statements with a paragraph illustrating why Oracle’s claims weren’t true. It also objects to the software vendor’s recent Kill Siebel advertising campaign which states that Siebel has O% Internet Application Sales, and that Only Oracle Applications are 100% Pure Internet. Both accusations are patently false the attorneys said.
The attorneys went on to attack statements made by key Oracle employees to the investment community that Siebel’s largest institutional shareholder (also shared by Oracle) was so impressed with Oracle’s CRM product that it was unloading its Siebel Systems stock. Fact: the letter read. These statements were patently false and have been categorically denied by the shareholder, but this rumor was picked up on one or more investor chat boards on the internet.
Then, addressing Ellison personally, the lawyers said. You and Oracle have made a very clear record of your deliberate strategy of attempting to damage Siebel. Although the unprofessional characteristics of Oracle’s conduct toward Siebel have the appearance of a personal vendetta, we have learned that the current Kill Siebel strategy has been discussed at the highest executive and management levels at Oracle, including the Oracle board of directors. We are copying this letter to the Oracle board to alert them to their potential liability for Oracle’s illegal actions, and with the expectation that they will take action to protect the Oracle shareholders by ending your illegal personal crusade.
And then, in perhaps the most damning outburst. Under the circumstances, Siebel has a strong case against Oracle for false and misleading advertising in violation of the Federal Lanham Act, as well as unfair competition, interference with business relations and trade libel in violation of California state laws, entitling Siebel to injunctive relief. Due to your current efforts to mislead the consuming public about your own and your competitors’ products, we also believe the Consumer Protection division of the Federal Trade Commission may have some interest in this matter. Your efforts to mislead the investing public, as well as your employees’ blatant efforts to manipulate Oracle and Siebel stock prices, may very well be of interest to the Securities Exchange Commission. And to the extent that your officers and directors have endorsed the illegal acts described above, they may be individually liable.
The letter finished by referring Ellison to a series of reports which the attorneys said: you could have and should have consulted, before embarking on its anti-Siebel campaign. Although they requested a receipt and written assurances that Oracle would terminate its activities within seven days of receiving the June 14 letter, no such communication has yet been received, Siebel said. á
Oracle issued a response to the letter late on Wednesday, denying that it had engaged in unfair marketing tactics, and insisting on the accuracy of its two key criticisms that Siebel products are still client-server rather than true thin-client and that Siebel software does not integrate…front office capabilities with critical back office functions such as order fulfillment and shipping without resource to custom development. Oracle also counter-claimed that Siebel executives had made several blatantly false statements about Oracle over the past months and that Siebel itself had made a decision not to partner with Oracle’s database division months ago. It asked in turn for an assurance from Siebel that it would cease and desist from further distribution of legal letters and confidential internal Oracle emails to Oracle partners and customers.
