Teradata alleges SAP stole secrets and ex-Infy man Vishal Sikka knew it; Calls SAP HANA "inferior" and BW "ill-equipped"

Last Updated: Thu, Jun 21, 2018 17:01 hrs
Vishal Sikka SAP Teradata

Teradata, a Cloud based analytics solution provider, has alleged that SAP, the German company offering enterprise software solutions, has stolen it's trade secrets.

A case has been filed by Teradata in a US court in the Northern district of California. The case also details the role of Vishal Sikka, an ex-CTO at SAP, who later created history as Infosys' first non-founder CEO.

Teradata has claimed that SAP breached a 2008 joint venture to gain access to its intellectual property and thereby created a software product that could compete against the original. On Wednesday, a complaint shared by Teradata read, "SAP has engaged in a decade-long campaign of anti-competitive behavior, to the detriment of the parties' customers and Teradata alike."

The analytics company labelled SAP's HANA as an "inferior product" in this report, and also conceded that SAP lured Teradata into forming a joint venture.

A 36-page complaint filed by Teradata details the reasons for a lawsuit, and claims for awarding damages and a trial jury.

"As set forth in the complaint, Teradata is alleging that SAP has engaged in a decade-long campaign of anti-competitive behavior, to the detriment of the parties' customers and Teradata alike. SAP lured Teradata into a purported joint venture in order to gain access to Teradata's valuable intellectual property. SAP's purpose for the joint venture was to steal Teradata's trade secrets, developed over the course of four decades, and use them to quickly develop and introduce a competing though inferior product, SAP HANA. Upon release of SAP HANA, SAP promptly terminated the joint venture, and SAP is now attempting to coerce its customers into using HANA only, to the exclusion of Teradata," reads the lawsuit.

Speaking about the role of Dr Vishal Sikka, the complaint, a copy of which is available on the website of Teradata revealed, "In the summer of 2009, just months after the Bridge Project formally began, SAP co-founder Hasso Plattner and then-CTO Dr Vishal Sikka announced their goal of revitalizing SAP’s lackluster and outdated product offerings by developing a new, faster database architecture. Dr Sikka quickly restructured SAP’s engineering teams to develop and deploy SAP HANA in less than a year, an extremely short time frame for a project of such magnitude."

The complaint further narrates that SAP's HANA was displayed at SAP's SAPPHIRE conference in May 2011, a large congregation of IT executives organised annually by SAP. BW, another SAP product was termed as "ill-equipped to generate reports using data from any other source besides SAP's ERP Applications. Nonetheless, SAP HANA use eventually took off (aided by SAP’s anticompetitive conduct discussed below), with HANA revenue reaching $2 billion by 2016."

The complaint refers to Dr Sikka as being lauded in the industry as the "father" and "mastermind" of SAP HANA. He "was credited with reversing SAP’s stagnant product offerings."

Here are other pointers from the complaint:

1. Teradata "supports competition and innovation in the data and analytics space. SAP's conduct, however, is neither pro-competitive nor innovative. We believe seeking relief through legal action against SAP is a necessary step to protect the rights and interests of our shareholders and all of our other stakeholders, including our customers," reads one piece of the story."

2. As Teradata would later learn (well after SAP’s termination of the Bridge Project), SAP was able to develop and bring HANA to market so quickly because SAP stole and misused Teradata’s intellectual property. On September 4, 2015, Der Spiegel published an article reporting that an internal SAP auditor (later identified as Dr. Thomas Waldbaum) concluded that SAP misappropriated proprietary and confidential information from Teradata that SAP engineers obtained during the Bridge Project.

3. Teradata learned that several SAP employees working on the Bridge Project, who therefore had access to and used confidential Teradata information, were simultaneously working on HANA. Later, many of these employees would be assigned to HANA full-time

4. It has become clear to Teradata that SAP was able to go to market so quickly only because SAP entered into an agreement with Teradata under the false pretense of integrating the two companies’ technologies, stole key Teradata trade secrets, and then incorporated them into and used them to develop HANA.

5. Teradata is seeking an injunction barring SAP’s illegal conduct, monetary damages, and all other legal and equitable relief available under law and which the court may deem proper.

The last time such a case was heard at the District Court in North California was way back in the year 2010. The case was between Oracle and SAP. Oracle had accused TomorrowNow, a company that had been acquired by SAP in 2005 of unlawful downloading, copying and use of copyrighted software. Oracle also claimed that SAP knew about copyrights being infringed upon during the acquisition.

The jury awarded Oracle $1.3 billion for SAP's copyright infringement, although Oracle had claimed $2.15 billion as fair market value for the licenses of the infringed product.

Sify.com is trying to get in touch with officials from SAP as well as Teradata to understand more about the case, and will update this page with more information soon.

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