SC TO-T/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Amendment No. 32

to

SCHEDULE TO

(RULE 14d-100)

Tender Offer Statement Pursuant to Section 14(d)(1) or 13(e)(1) of

the Securities Exchange Act of 1934

PEOPLESOFT, INC.

(Name of Subject Company)

PEPPER ACQUISITION CORP.

ORACLE CORPORATION

(Names of Filing Persons—Offeror)

COMMON STOCK, PAR VALUE $0.01 PER SHARE

(Title of Class of Securities)

712713106

(Cusip Number of Class of Securities)

Daniel Cooperman

Senior Vice President, General Counsel and Secretary

Oracle Corporation

500 Oracle Parkway

Redwood City, California 94065

Telephone: (650) 506-7000

(Name, Address and Telephone Number of Person Authorized to Receive Notices

and Communications on Behalf of Filing Persons)

Copies to:

William M. Kelly

Davis Polk & Wardwell

1600 El Camino Real

Menlo Park, California 94025

Telephone: (650) 752-2000

CALCULATION OF FILING FEE

Transaction Valuation*	Amount of Filing Fee**
$7,250,846,650	$586,593

* Estimated for purposes of calculating the amount of filing fee only. Transaction value derived by multiplying 371,838,290 (the sum of the number of shares of common stock of the subject company outstanding as of July 10, 2003, plus 0.43 multiplied by the number of shares of common stock of J.D. Edwards & Company outstanding as of July 10, 2003 (each according to the Prospectus filed with the Securities and Exchange Commission by the subject company pursuant to Rule 424(b)(3) under the Securities Act of 1933 on June 11, 2003) by $19.50 (the purchase price per share offered by Offeror).

** The amount of the filing fee, calculated in accordance with Rule 0-11 of the Securities and Exchange Act of 1934, as amended, and Fee Advisory #11 for Fiscal Year 2003 issued by the Securities and Exchange Commission on February 21, 2003, equals 0.00008090% of the transaction valuation.

x Check box if any part of the fee is offset as provided by Rule 0-11(a)(2) and identify the filing with which the offsetting fee was previously paid. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.

Amount Previously Paid:	$87,131	Filing Party:	Oracle Corporation
Form or Registration No.:	SC TO-T/A	Date Filed:	July 24, 2003
Amount Previously Paid:	$89,647	Filing Party:	Oracle Corporation
Form or Registration No.:	SC TO-T/A	Date Filed:	June 18, 2003
Amount Previously Paid:	$409,815	Filing Party:	Oracle Corporation
Form or Registration No.:	SC TO-T	Date Filed:	June 9, 2003

¨ Check the box if the filing relates solely to preliminary communications made before the commencement of a tender offer.

Check the appropriate boxes below to designate any transactions to which the statement relates:

x third-party tender offer subject to Rule 14d-1.

¨ issuer tender offer subject to Rule 13e-4.

¨ going-private transaction subject to Rule 13e-3.

¨ amendment to Schedule 13D under Rule 13d-2.

Check the following box if the filing is a final amendment reporting the results of the tender offer.  ¨

Items 1 through 9, and Item 11.

This Amendment No. 32 to Tender Offer Statement on Schedule TO amends and supplements the statement originally filed on June 9, 2002, as amended, by Oracle Corporation, a Delaware corporation (“Parent”), and Pepper Acquisition Corp. (the “Purchaser”), a Delaware corporation and a wholly owned subsidiary of Parent. This Schedule TO relates to the offer by the Purchaser to purchase all outstanding shares of common stock, par value $0.01 per share, and the associated preferred stock purchase rights (together, the “Shares”), of PeopleSoft, Inc., a Delaware corporation (the “Company”), at $19.50 per Share, net to the seller in cash, without interest, upon the terms and subject to the conditions set forth in the Amended and Restated Offer to Purchase, dated July 24, 2003, as amended (the “Amended and Restated Offer to Purchase”), and in the related Amended and Restated Letter of Transmittal (which, together with any amendments or supplements thereto, collectively constitute the “Offer”). The information set forth in the Amended and Restated Offer to Purchase and the related Amended and Restated Letter of Transmittal is incorporated herein by reference with respect to Items 1 through 9 and 11 of this Schedule TO.

Item 10.    Financial Statements.

Not applicable.

Item 11.    Additional Information.

On June 12, 2003, J.D. Edwards & Company filed suit in the Superior Court of the State of California, County of San Mateo, against Parent, Purchaser, and certain other defendants seeking damages, injunctive relief, and other relief (the “San Mateo Action”). This complaint was previously filed as Exhibit (a)(5)(viii). On the same date J.D. Edwards also filed suit against Parent and Purchaser in the District Court for the City and County of Denver, Colorado, seeking damages, declaratory relief and other relief (the “Colorado Action”). This complaint was previously filed as Exhibit (a)(5)(vii). In both the San Mateo and Colorado Actions, stipulations of dismissal were executed and filed by the parties after the PeopleSoft-J.D. Edwards merger was consummated. The stipulation and order filed in the San Mateo action is filed herewith as Exhibit (a)(5)(lxvi). The order granting the dismissal in the Colorado action is filed herewith as Exhibit (a)(5)(lxvii).

On June 13, 2003, PeopleSoft filed suit against Parent and Purchaser in the Superior Court of the State of California, County of Alameda, seeking damages, injunctive relief and other relief (the “Alameda Action”). In that action, PeopleSoft alleges that the defendants wrongfully interfered with the pending merger agreement between J.D. Edwards and PeopleSoft, wrongfully interfered with existing and prospective software license sales by PeopleSoft to its customers and engaged in trade libel and false advertising in connection with the tender offer. This complaint was previously filed as Exhibit (a)(5)(xi). On August 12, 2003, PeopleSoft filed a First Amended Complaint, asserting substantially similar claims and purporting to bring claims on behalf of J.D. Edwards. The First Amended Complaint is filed herewith as Exhibit (a)(5)(lxviii).

On September 11, 2003, Parent and Purchaser filed a Defendant’s Notice of Demurrer and Demurrer to Plaintiff’s First Amended Complaint in the Superior Court of the State of California, County of Alameda. Parent and Purchaser assert that PeopleSoft has failed to state facts sufficient to constitute any causes of action alleged in its First Amended Complaint. The Defendant’s Notice of Demurrer and Demurrer to Plaintiff’s First Amended Complaint, and the Memorandum of Points and Authorities in Support of Defendant’s Demurrer to Plaintiff’s First Amended Complaint are filed herewith as Exhibit (a)(5)(lxix).

On June 18, 2003, the State of Connecticut (the “State”) filed suit against Parent and Purchaser in the U.S. District Court for the District of Connecticut, seeking declaratory relief, injunctive relief and other relief. In that action, the State alleges that the proposed acquisition of PeopleSoft would be anticompetitive and would violate state and federal antitrust laws. The complaint was previously filed as Exhibit (a)(5)(xix). The State thereafter filed an Amended Complaint on August 4, 2003. The Amended Complaint is filed herewith as Exhibit (a)(5)(lxx). In response to that action, Parent and Purchaser filed a Defendant’s Motion to Dismiss on August 18, 2003. The Defendant’s Motion to Dismiss, along with the Defendant’s Memorandum of Law in Support of Motion to Dismiss and the Declaration of Eric D. Beal in Support of Defendant’s Motion to Dismiss is filed herewith as Exhibit (a)(5)(lxxi).

Item 12.    Exhibits.

(a)(1)(i)	Offer to Purchase dated June 9, 2003.*
(a)(1)(ii)	Form of Letter of Transmittal.*
(a)(1)(iii)	Form of Notice of Guaranteed Delivery.*
(a)(1)(iv)	Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees.*
(a)(1)(v)	Form of Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees.*
(a)(1)(vi)	Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9.*
(a)(1)(vii)	Form of summary advertisement dated June 9, 2003.*
(a)(1)(viii)	Amended and Restated Offer to Purchase dated July 24, 2003.*
(a)(1)(ix)	Form of Amended and Restated Letter of Transmittal.*
(a)(1)(x)	Form of Amended and Restated Notice of Guaranteed Delivery.*
(a)(5)(i)	Text of press release issued by Parent, dated June 6, 2003.*
(a)(5)(ii)	Text of press release issued by Parent, dated June 9, 2003.*
(a)(5)(iii)	Text of information on Parent’s website, posted June 10, 2003.*
(a)(5)(iv)	Text of press release issued by Parent, dated June 10, 2003.*
(a)(5)(v)	Slide presentation by Parent, dated June 13, 2003.*
(a)(5)(vi)	Text of press release issued by Parent, dated June 13, 2003.*
(a)(5)(vii)	Complaint and Jury Demand filed in the District Court for the City and County of Denver, Colorado on June 12, 2003.*
(a)(5)(viii)	Complaint filed in the Superior Court of the State of California, County of San Mateo on June 12, 2003.*
(a)(5)(ix)	Advertisement placed by Parent on June 16, 2003.*
(a)(5)(x)	Text of press release issued by Parent, dated June 16, 2003.*
(a)(5)(xi)	Complaint filed in the Superior Court of the State of California, County of Alameda on June 13, 2003.*
(a)(5)(xii)	Advertisement placed by Parent on June 16, 2003.*
(a)(5)(xiii)	Text of press release issued by Parent, dated June 16, 2003.*
(a)(5)(xiv)	Text of information on Parent’s website, posted June 16, 2003.*
(a)(5)(xv)	Text of press release issued by Parent, dated June 18, 2003.*
(a)(5)(xvi)	Complaint filed in the Court of Chancery of the State of Delaware, New Castle County, on June 18, 2003.*
(a)(5)(xvii)	Transcript of Conference Call held by Parent on June 18, 2003.*
(a)(5)(xviii)	Investor presentation by Parent, dated June 18, 2003.*
(a)(5)(xix)	Complaint filed in the United States District Court for the District of Connecticut on June 18, 2003.*
(a)(5)(xx)	Advertisement placed by Parent on June 19, 2003.*
(a)(5)(xxi)	Email statement to press issued by Parent, dated June 18, 2003.*
(a)(5)(xxii)	Text of press release issued by Parent, dated June 20, 2003.*
(a)(5)(xxiii)	Advertisement placed by Parent on June 23, 2003.*
(a)(5)(xxiv)	Text of press release issued by Parent, dated June 24, 2003.*
(a)(5)(xxv)	Advertisement placed by Parent on June 27, 2003.*
(a)(5)(xxvi)	Text of email message to Parent employees dated June 26, 2003.*
(a)(5)(xxvii)	Email statement to press issued by Parent, dated June 29, 2003.*
(a)(5)(xxviii)	Text of press release issued by Parent, dated June 30, 2003.*
(a)(5)(xxix)	Text of information on Parent’s website, posted June 30, 2003.*

(a)(5)(xxx)	Letter to PeopleSoft customers, dated June 30, 2003.*
(a)(5)(xxxi)	Case study dated June 30, 2003.*
(a)(5)(xxxii)	Information regarding Parent customer support dated June 30, 2003.*
(a)(5)(xxxiii)	Text of press release issued by Parent, dated June 30, 2003.*
(a)(5)(xxxiv)	Text of press release issued by Parent, dated July 1, 2003.*
(a)(5)(xxxv)	Text of press release issued by Parent, dated July 2, 2003.*
(a)(5)(xxxvi)	Text of press release issued by Parent, dated July 3, 2003.*
(a)(5)(xxxvii)	Amended text of information on Parent’s internal website, posted July 9, 2003.*
(a)(5)(xxxviii)	Text of material prepared for presentation to analysts, dated July 9, 2003.*
(a)(5)(xxxix)	Transcript of portion of webcast presentation to analysts pertaining to the tender offer, dated July 9, 2003.*
(a)(5)(xxxx)	Text of e-mail message to PeopleSoft User Group, dated July 10, 2003.*
(a)(5)(xxxxi)	Advertisement placed by Parent on July 11, 2003.*
(a)(5)(xxxxii)	Text of press release issued by Parent, dated July 14, 2003.*
(a)(5)(xxxxiii)	Text of letter to partners, sent July 14, 2003.*
(a)(5)(xxxxiv)	Questions and answers for PeopleSoft customers, dated July 14, 2003.*
(a)(5)(xxxxv)	Text of press release issued by Parent, dated July 15, 2003.*
(a)(5)(xxxxvi)	Advertisement placed by Parent on July 15, 2003.*
(a)(5)(xxxxvii)	Transcript of “town hall” presentation to PeopleSoft customers, dated July 17, 2003.*
(a)(5)(xxxxviii)	Advertisement placed by Parent on July 2, 2003.*
(a)(5)(il)	Advertisement placed by Parent on June 30, 2003.*
(a)(5)(l)	Text of press release issued by Parent, dated July 17, 2003.*
(a)(5)(li)	Transcript of “Oracle Beat” presentation to Parent employees, dated July 17, 2003.*
(a)(5)(lii)	Text of press release issued by Parent, dated July 24, 2003.*
(a)(5)(liii)	Text of press release issued by Parent, dated August 8, 2003.*
(a)(5)(liv)	Transcript of portion of webcast comments pertaining to the tender offer, from CIBC World Markets Enterprise Software Conference on August 6, 2003.*
(a)(5)(lv)	Transcript of portion of webcast Q&A session pertaining to the tender offer, from CIBC World Markets Enterprise Software Conference on August 6, 2003.*
(a)(5)(lvi)	Text of portion of slide presentation pertaining to the tender offer, prepared for CIBC World Markets Enterprise Software Conference on August 6, 2003.*
(a)(5)(lvii)	Text of press release issued by Parent on August 12, 2003.*
(a)(5)(lviii)	Text of information on Parent’s website, posted August 15, 2003.*
(a)(5)(lix)	Text of letter to customers, sent August 22, 2003.*
(a)(5)(lx)	Notice of “town hall” meeting, sent August 22, 2003.*
(a)(5)(lxi)	Comments by Parent spokesman, provided August 26, 2003.*
(a)(5)(lxii)	Text of press release issued by Parent, dated August 27, 2003.*
(a)(5)(lxiii)	Transcript of “town hall” presentation to PeopleSoft customers, dated September 3, 2003.*
(a)(5)(lxiv)	Text of press release issued by Parent, dated September 4, 2003.*
(a)(5)(lxv)	Text of employee announcement on Parent’s internal website, dated September 10, 2003.*
(a)(5)(lxvi)	Stipulation and Order Dismissing Case Without Prejudice filed in the Superior Court of the State of California, County of San Mateo on August 15, 2003.

(a)(5)(lxvii)	Order Granting Stipulation Dismissing Case Without Prejudice, issued by the District Court for the City and County of Denver, Colorado on August 18, 2003.
(a)(5)(lxviii)	First Amended Complaint filed in the Superior Court of the State of California, County of Alameda on August 12, 2003.
(a)(5)(lxix)	Demurrer filed in the Superior Court of the State of California, County of Alameda on September 11, 2003.
(a)(5)(lxx)	Amended Complaint filed in the United States District Court for the District of Connecticut on August 4, 2003.
(a)(5)(lxxi)	Defendant’s Motion to Dismiss and related documents filed in the United States District Court for the District of Connecticut on August 18, 2003.
(a)(5)(lxxii)	Transcript of portion of earnings conference call pertaining to tender offer, held September 12, 2003.
(b)(1)	Commitment letter described in Section 9, “Source and Amount of Funds” of the Offer to Purchase (the “Commitment Letter”).*
(b)(2)	Side Letter to the Commitment Letter.*
(c)	Not applicable.
(d)	Not applicable.
(e)	Not applicable.
(f)	Not applicable.
(g)	Not applicable.
(h)	Not applicable.

* Previously filed

SIGNATURE

After due inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

Dated:  September 16, 2003

ORACLE CORPORATION
By:	/s/    SAFRA CATZ
	Name:	Safra Catz
	Title:	Executive Vice President
PEPPER ACQUISITION CORP.
By:	/s/    SAFRA CATZ
	Name:	Safra Catz
	Title:	President

EXHIBIT INDEX

Index No.
(a)(1)(i)	Offer to Purchase dated June 9, 2003.*
(a)(1)(ii)	Form of Letter of Transmittal.*
(a)(1)(iii)	Form of Notice of Guaranteed Delivery.*
(a)(1)(iv)	Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees.*
(a)(1)(v)	Form of Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees.*
(a)(1)(vi)	Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9.*
(a)(1)(vii)	Form of summary advertisement dated June 9, 2003.*
(a)(1)(viii)	Amended and Restated Offer to Purchase dated July 24, 2003.*
(a)(1)(ix)	Form of Amended and Restated Letter of Transmittal.*
(a)(1)(x)	Form of Amended and Restated Notice of Guaranteed Delivery.*
(a)(5)(i)	Text of press release issued by Parent, dated June 6, 2003.*
(a)(5)(ii)	Text of press release issued by Parent, dated June 9, 2003.*
(a)(5)(iii)	Text of information on Parent’s website, posted June 10, 2003.*
(a)(5)(iv)	Text of press release issued by Parent, dated June 10, 2003.*
(a)(5)(v)	Slide presentation by Parent, dated June 13, 2003.*
(a)(5)(vi)	Text of press release issued by Parent, dated June 13, 2003.*
(a)(5)(vii)	Complaint and Jury Demand filed in the District Court for the City and County of Denver, Colorado on June 12, 2003.*
(a)(5)(viii)	Complaint filed in the Superior Court of the State of California, County of San Mateo on June 12, 2003.*
(a)(5)(ix)	Advertisement placed by Parent on June 16, 2003.*
(a)(5)(x)	Text of press release issued by Parent, dated June 16, 2003.*
(a)(5)(xi)	Complaint filed in the Superior Court of the State of California, County of Alameda on June 13, 2003.*
(a)(5)(xii)	Advertisement placed by Parent on June 16, 2003.*
(a)(5)(xiii)	Text of press release issued by Parent, dated June 16, 2003.*
(a)(5)(xiv)	Text of information on Parent’s website, posted June 16, 2003.*
(a)(5)(xv)	Text of press release issued by Parent, dated June 18, 2003.*
(a)(5)(xvi)	Complaint filed in the Court of Chancery of the State of Delaware, New Castle County, on June 18, 2003.*
(a)(5)(xvii)	Transcript of Conference Call held by Parent on June 18, 2003.*
(a)(5)(xviii)	Investor presentation by Parent, dated June 18, 2003.*
(a)(5)(xix)	Complaint filed in the United States District Court for the District of Connecticut on June 18, 2003.*
(a)(5)(xx)	Advertisement placed by Parent on June 19, 2003.*
(a)(5)(xxi)	Email statement to press issued by Parent, dated June 18, 2003.*
(a)(5)(xxii)	Text of press release issued by Parent, dated June 20, 2003.*
(a)(5)(xxiii)	Advertisement placed by Parent on June 23, 2003.*
(a)(5)(xxiv)	Text of press release issued by Parent, dated June 24, 2003.*
(a)(5)(xxv)	Advertisement placed by Parent on June 27, 2003.*
(a)(5)(xxvi)	Text of email message to Parent employees dated June 26, 2003.*
(a)(5)(xxvii)	Email statement to press issued by Parent, dated June 29, 2003.*
(a)(5)(xxviii)	Text of press release issued by Parent, dated June 30, 2003.*

Index No.
(a)(5)(xxix)	Text of information on Parent’s website, posted June 30, 2003.*
(a)(5)(xxx)	Letter to PeopleSoft customers, dated June 30, 2003.*
(a)(5)(xxxi)	Case study dated June 30, 2003.*
(a)(5)(xxxii)	Information regarding Parent customer support dated June 30, 2003.*
(a)(5)(xxxiii)	Text of press release issued by Parent, dated June 30, 2003.*
(a)(5)(xxxiv)	Text of press release issued by Parent, dated July 1, 2003.*
(a)(5)(xxxv)	Text of press release issued by Parent, dated July 2, 2003.*
(a)(5)(xxxvi)	Text of press release issued by Parent, dated July 3, 2003.*
(a)(5)(xxxvii)	Amended text of information on Parent’s internal website, posted July 9, 2003.*
(a)(5)(xxxviii)	Text of material prepared for presentation to analysts, dated July 9, 2003.*
(a)(5)(xxxix)	Transcript of portion of webcast presentation to analysts pertaining to the tender offer, dated July 9, 2003.*
(a)(5)(xxxx)	Text of e-mail message to PeopleSoft User Group, dated July 10, 2003.*
(a)(5)(xxxxi)	Advertisement placed by Parent on July 11, 2003.*
(a)(5)(xxxxii)	Text of press release issued by Parent, dated July 14, 2003.*
(a)(5)(xxxxiii)	Text of letter to partners, sent July 14, 2003.*
(a)(5)(xxxxiv)	Questions and answers for PeopleSoft customers, dated July 14, 2003.*
(a)(5)(xxxxv)	Text of press release issued by Parent, dated July 15, 2003.*
(a)(5)(xxxxvi)	Advertisement placed by Parent on July 15, 2003.*
(a)(5)(xxxxvii)	Transcript of “town hall” presentation to PeopleSoft customers, dated July 17, 2003.*
(a)(5)(xxxxviii)	Advertisement placed by Parent on July 2, 2003.*
(a)(5)(il)	Advertisement placed by Parent on June 30, 2003.*
(a)(5)(l)	Text of press release issued by Parent, dated July 17, 2003.*
(a)(5)(li)	Transcript of “Oracle Beat” presentation to Parent employees, dated July 17, 2003.*
(a)(5)(lii)	Text of press release issued by Parent, dated July 24, 2003.*
(a)(5)(liii)	Text of press release issued by Parent, dated August 8, 2003.*
(a)(5)(liv)	Transcript of portion of webcast comments pertaining to the tender offer, from CIBC World Markets Enterprise Software Conference on August 6, 2003.*
(a)(5)(lv)	Transcript of portion of webcast Q&A session pertaining to the tender offer, from CIBC World Markets Enterprise Software Conference on August 6, 2003.*
(a)(5)lvi)	Text of portion of slide presentation pertaining to the tender offer, prepared for CIBC World Markets Enterprise Software Conference on August 6, 2003.*
(a)(5)(lvii)	Text of press release issued by Parent on August 12, 2003.*
(a)(5)(lviii)	Text of information on Parent’s website, posted August 15, 2003.*
(a)(5)(lix)	Text of letter to customers, sent August 22, 2003.*
(a)(5)(lx)	Notice of “town hall” meeting, sent August 22, 2003.*
(a)(5)(lxi)	Comments by Parent spokesman, provided August 26, 2003.*
(a)(5)(lxii)	Text of press release issued by Parent, dated August 27, 2003.*
(a)(5)(lxiii)	Transcript of “town hall” presentation to PeopleSoft customers, dated September 3, 2003.*
(a)(5)(lxiv)	Text of press release issued by Parent, dated September 4, 2003.*
(a)(5)(lxv)	Text of employee announcement on Parent’s internal website, dated September 10, 2003.*

(a)(5)(lxvi)	Stipulation and Order Dismissing Case Without Prejudice filed in the Superior Court of the State of California, County of San Mateo on August 15, 2003.
(a)(5)(lxvii)	Order Granting Stipulation Dismissing Case Without Prejudice, issued by the District Court for the City and County of Denver, Colorado on August 18, 2003.
(a)(5)(lxviii)	First Amended Complaint filed in the Superior Court of the State of California, County of Alameda on August 12, 2003.
(a)(5)(lxix)	Demurrer filed in the Superior Court of the State of California, County of Alameda on September 11, 2003.
(a)(5)(lxx)	Amended Complaint filed in the United States District Court for the District of Connecticut on August 4, 2003.
(a)(5)(lxxi)	Defendant’s Motion to Dismiss and related documents filed in the United States District Court for the District of Connecticut on August 18, 2003.
(a)(5)(lxxii)	Transcript of portion of earnings conference call pertaining to tender offer, held September 12, 2003.
(b)(1)	Commitment letter described in Section 9, “Source and Amount of Funds” of the Offer to Purchase.*
(b)(2)	Side Letter to the Commitment Letter.*
(c)	Not applicable.
(d)	Not applicable.
(e)	Not applicable.
(f)	Not applicable.
(g)	Not applicable.
(h)	Not applicable.

* Previously filed

EX-99.(A)(5)(LXVI)

Exhibit (a)(5)(lxvi)

JAMES A. DiBOISE, State Bar No. 083296

DAVID J. BERGER, State Bar No. 147645

JARED L. KOPEL, State Bar No. 126817

CYNTHIA A. DY, State Bar No. 172761

WILSON SONSINI GOODRICH & ROSATI

Professional Corporation

650 Page Mill Road

Palo Alto, CA 94304-1050

Telephone: (650) 493-9300

Facsimile: (650) 565-5100

Attorneys for Plaintiff

J.D. Edwards & Company

SUPERIOR COURT OF THE STATE OF CALIFORNIA

COUNTY OF SAN MATEO

J.D. EDWARDS & COMPANY	)	CASE NO.: CIV 431969
	)
Plaintiff,	)
	)	STIPULATION AND
v.	)	ORDER DISMISSING CASE
	)	WITHOUT PREJUDICE
ORACLE CORPORATION, PEPPER	)
ACQUISITION CORPORATION, LAWRENCE	)
J. ELLISON, CHARLES PHILLIPS and DOES	)
1-100,	)
	)
Defendants.	)
	)
	)
	)
	)

WHEREAS, on June 12, 2003, Plaintiff J.D. Edwards & Company (“J.D. Edwards”) filed the complaint in this action against Oracle Corporation, Pepper Acquisition Corporation, Lawrence J. Ellison, Charles Phillips, and Does 1-100 (collectively, “Defendants”);

WHEREAS, on June 13, 2003, PeopleSoft, Inc. (“PeopleSoft”) filed a complaint against all or some of the Defendants alleging similar facts and claims in the Superior Court of the State of California for the County of Alameda (Case No. RG03101434) (the “PeopleSoft Action”);

/ / /

/ / /

STIPULATION AND [PROPOSED] ORDER DISMISSING CASE WITHOUT PREJUDICE

WHEREAS, on or around June 16, 2003, J.D. Edwards and PeopleSoft entered into an amended Merger Agreement (“Merger Agreement”) whereby each J.D. Edwards shareholder could elect to receive either PeopleSoft stock or cash in exchange for J.D. Edwards stock;

WHEREAS, on July 17, 2003, PeopleSoft purchased approximately 88% of the outstanding shares of J.D. Edwards and PeopleSoft expects to acquire the remaining shares of J.D. Edwards before the end of August 2003, making J.D. Edwards a wholly-owned subsidiary of PeopleSoft;

WHEREAS, in light of the consummation of the Merger Agreement and the fact that PeopleSoft may elect to re-assert some or all of J.D. Edwards’ pending claims in the PeopleSoft Action, the parties believe that this action should be dismissed without prejudice in the interests of justice and in order to avoid duplicative litigation;

IT IS HEREBY STIPULATED BY AND BETWEEN J.D. Edwards and Defendants, through their counsel of record, subject to the Court’s approval that:

This action is dismissed without prejudice, with each side to bear their own costs, and J.D. Edwards and its parent corporation, PeopleSoft, reserve the right to reassert the claims brought forth in this action against Defendants in the PeopleSoft Action currently pending in Alameda County.

Dated:  August 12, 2003	WILSON SONSINI GOODRICH & ROSATI Professional Corporation
	By:	/s/ David J. Berger
		David J. Berger
	Attorneys for Plaintiff J.D. Edwards & Company

2

STIPULATION AND [PROPOSED] ORDER DISMISSING CASE WITHOUT PREJUDICE

Dated:  August 12, 2003	BINGHAM MCCUTCHEN LLP
	By:	/s/ Stephen D. Hibbard
		Stephen D. Hibbard
	Attorneys for Defendants Oracle Corporation, Pepper Acquisition Corporation, Lawrence J. Ellison, and Charles Phillips.

ORDER

IT IS SO ORDERED

Dated: August 14, 2003	/s/ Quentin L. Kopp
	Superior Court Judge

3

STIPULATION AND [PROPOSED] ORDER DISMISSING CASE WITHOUT PREJUDICE

EX-99.(A)(5)(LXVII)

Exhibit (a)(5)(lxvii)

DISTRICT COURT, CITY AND COUNTY, COLORADO Court Address:         1437 Bannock Street                                      Denver, CO 80202
Plaintiffs: J.D. EDWARDS & COMPANY, v. Defendants:
ORACLE CORPORATION and PEPPER ACQUISITION CORP., DOES 1-50	D    COURT USE ONLY    D
Attorneys: Stephen J. Baity Steven L. Heisdorffer GODIN & BAITY, LLC 1050 Seventeenth Street, Suite 1610 Denver, CO 80265 303-572-3100 Atty. Reg. #: 13137 Atty. Reg. #: 19800	Case No. 2003CV4270 Division: 18
David Berger Jared L. Kopel WILSON SONSINI GOODRICH & ROSATI 650 Page Mill Road Palo Alto, CA 94304 (650) 493-9300
ORDER GRANTING STIPULATION DISMISSING CASE WITHOUT PREJUDICE

THIS MATTER coming before the Court on the parties Stipulation Dismissing Case without Prejudice, and the Court being fully advised in the premises;

WHEREAS, on June 12, 2003, Plaintiff J.D. Edwards & Company (“J.D. Edwards”) filed the Complaint in this action against Oracle Corporation, Pepper Acquisition Corporation, and Does 1-50;

WHEREAS, on June 13, 2003, PeopleSoft, Inc. (“PeopleSoft”) filed a Complaint against all or some of the Defendants alleging similar facts and claims in the Superior Court of the State of California for the County of Alameda (Case No. RG03101434) (the “PeopleSoft Action”);

WHEREAS, on or around June 16, 2003, J.D. Edwards and PeopleSoft entered into an amended Merger Agreement (“Merger Agreement”) whereby each J.D. Edwards shareholder could elect to receive either PeopleSoft stock or cash in exchange for J.D. Edwards stock;

WHEREAS, on July 17, 2003, PeopleSoft purchased approximately 88% of the outstanding shares of J.D. Edwards and PeopleSoft expects to acquire the remaining shares of J.D. Edwards before the end of August 2003, making J.D. Edwards a wholly owned subsidiary of PeopleSoft;

WHEREAS, in light of the consummation of the Merger Agreement and the fact that PeopleSoft may elect to re-assert some or all of J.D. Edwards’ pending claims in the PeopleSoft Action, the parties believe this action should be dismissed without prejudice in the interests of justice and in order to avoid duplicative litigation;

IT IS HEREBY STIPULATED BY AND BETWEEN J.D. Edwards and Defendants, through their counsel of record, subject to the Court’s approval that:

This action is dismissed without prejudice, with each side to bear their own costs, and J.D. Edwards and its parent corporation, PeopleSoft, reserve the right to reassert the claims brought forth in this action against Defendants in the PeopleSoft Action currently pending in Alameda County, California.

Dated this      day of                     , 2003.

CT. RM. 18    AUG 18 2003	By the Court:
	/s/ Judge Joseph Meyer III

EX-99.(A5)(LXVIII)

Exhibit (a)(5)(lxviii)

JONATHAN C. DICKEY, SBN 088226

TIMOTHY K. ROAKE, SBN 099539

PAUL J. COLLINS, SBN 187709

GIBSON, DUNN & CRUTCHER LLP

1530 Page Mill Road

Palo Alto, California 94304

Telephone: (650) 849-5300

Facsimile: (650) 849-5333

WAYNE W. SMITH, SBN 054593

GIBSON, DUNN & CRUTCHER LLP

Jamboree Center

4 Park Plaza

Irvine, California 92614

Telephone: (949) 451-3800

Facsimile: (949) 451-4220

STEVEN P. MANDELL (pro hac vice)

STEPHEN J. ROSENFELD (pro hac vice)

MANDELL MENKES & SURDYK LLC

333 W. Wacker Drive, Suite 300

Chicago, Illinois 60606

Telephone: (312) 251-1000

Facsimile: (312) 251-1010

Attorneys for Plaintiffs

PEOPLESOFT, INC. and

J.D. EDWARDS & COMPANY

SUPERIOR COURT OF THE STATE OF CALIFORNIA

FOR THE COUNTY OF ALAMEDA

PEOPLESOFT, INC., a Delaware corporation, and J.D. EDWARDS & COMPANY, a Delaware corporation,	CASE NO. RG03101434 FIRST AMENDED COMPLAINT FOR:
Plaintiffs,	VIOLATIONS OF CAL. BUS. & PROF. CODE §§ 17200 & 17500; INTENTIONAL INTERFERENCE WITH CONTRACTUAL RELATIONS; INTENTIONAL INTERFERENCE WITH PROSPECTIVE ECONOMIC ADVANTAGE; NEGLIGENT INTERFERENCE WITH PROSPECTIVE ECONOMIC ADVANTAGE; AND TRADE LIBEL
v.
ORACLE CORPORATION, a Delaware corporation, PEPPER ACQUISITION CORP., a Delaware corporation, and DOES 1-100, inclusive,
Defendants.
	JURY TRIAL REQUESTED

CONDITIONALLY UNDER SEAL

The Enclosed Record Is Subject To A Motion To File The Record Under Seal

FIRST AMENDED COMPLAINT CASE NO. RG03101434

JONATHAN C. DICKEY, SBN 088226

TIMOTHY K. ROAKE, SBN 099539

PAUL J. COLLINS, SBN 187709

GIBSON, DUNN & CRUTCHER LLP

1530 Page Mill Road

Palo Alto, California 94304

Telephone: (650) 849-5300

Facsimile: (650) 849-5333

WAYNE W. SMITH, SBN 054593

GIBSON, DUNN & CRUTCHER LLP

Jamboree Center

4 Park Plaza

Irvine, California 92614

Telephone: (949) 451-3800

Facsimile: (949) 451-4220

STEVEN P. MANDELL (pro hac vice)

STEPHEN J. ROSENFELD (pro hac vice)

MANDELL MENKES & SURDYK LLC

333 W. Wacker Drive, Suite 300

Chicago, Illinois 60606

Telephone: (312) 251-1000

Facsimile: (312) 251-1010

Attorneys for Plaintiffs

PEOPLESOFT, INC. and

J.D. EDWARDS & COMPANY

SUPERIOR COURT OF THE STATE OF CALIFORNIA

FOR THE COUNTY OF ALAMEDA

PEOPLESOFT, INC., a Delaware corporation, and J.D. EDWARDS & COMPANY, a Delaware corporation,	CASE NO. RG03101434 FIRST AMENDED COMPLAINT FOR:
Plaintiffs,	VIOLATIONS OF CAL. BUS. & PROF. CODE §§ 17200 & 17500; INTENTIONAL INTERFERENCE WITH CONTRACTUAL RELATIONS; INTENTIONAL INTERFERENCE WITH PROSPECTIVE ECONOMIC ADVANTAGE;
v.
ORACLE CORPORATION, a Delaware corporation, PEPPER ACQUISITION CORP., a Delaware corporation, and DOES 1-100, inclusive,
Defendants.	NEGLIGENT INTERFERENCE WITH PROSPECTIVE ECONOMIC ADVANTAGE; AND TRADE LIBEL
	JURY TRIAL REQUESTED

FIRST AMENDED COMPLAINT CASE NO. RG03101434

Plaintiffs PeopleSoft, Inc. (“PeopleSoft”) and J.D. Edwards & Company (“J.D. Edwards”) (PeopleSoft and J.D. Edwards are sometimes collectively referred to as “PeopleSoft”), for their complaint against Defendants Oracle Corporation and Pepper Acquisition Corp. (together, “Oracle”), and Does 1 through 100, allege as follows:

I. INTRODUCTION

1. Four days after PeopleSoft announced a $1.7 billion agreement to merge with software maker J.D. Edwards, Oracle unleashed a hostile tender offer for all of the outstanding shares of PeopleSoft (the “Tender Offer”). The Tender Offer – what its CEO called a “war game in a box” – is nothing more than an unlawful attempt to kill PeopleSoft and was intended to scuttle the planned merger. While the merger closed successfully on July 18, 2003, this Action is brought under California law to remedy the substantial and ongoing harm to PeopleSoft, its customers, and its thousands of employees, from this illegal and anticompetitive scheme by Oracle and its agents.

2. Oracle’s first salvo in this “war game” was to announce that it planned to make a low-ball, cash offer of $16 per share for all of PeopleSoft’s outstanding stock. Oracle never intended the Tender Offer to be a serious offer to acquire PeopleSoft. Oracle knew the $16.00 price was artificially low, but in its CEO’s words, decided to “give it a whirl.” Indeed, even though the Tender Offer was described by Oracle executives as “unconditional,” the documents Oracle filed with the Securities & Exchange Commission state that Oracle will be under no obligation to purchase a single tendered PeopleSoft share should it determine, among other things, that the value to Oracle of the PeopleSoft shares has materially lessened since the original offer. [Internal Oracle documents reveal that Oracle also prepared a marketing, sales and public relations program designed to injure PeopleSoft and its products, in the express hope that injuring PeopleSoft would drop the price of its stock, making Oracle’s low-ball bid look attractive. The strategy was set forth plainly in one early e-mail: “The more something hurts PSFT, the more likely that share price drops and $16 starts to look better.”]

3. Rather than compete fairly and act in a way to preserve the business of the company it was seeking to acquire, Oracle settled on a scheme to disrupt PeopleSoft’s customer base using the platform provided by a hostile tender offer. Instead of focusing its message on the PeopleSoft

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shareholders to whom the Tender Offer was ostensibly addressed, Oracle unlawfully contacted PeopleSoft customers and embarked on a campaign of disinformation in an attempt to cripple PeopleSoft’s ability to sell its software and to poach its customers. Internal Oracle communications elucidate Oracle’s true intent. [An internal email sent the day after the Tender Offer was announced evidences this ruse: “We’ve certainly wounded PSFT. . . . Even if we don’t end up closing the deal, this is going to take PSFT time to recover. [¶] And, of course, our corporate image of being aggressive, brash, and marching to the tune of a different drummer has been reinforced. I dunno about you guys, but today I was very proud to be an Oracle employee!”]

4. Oracle bombarded the market and PeopleSoft’s customer base with dissembling and misleading statements concerning its alleged plans to better “support” PeopleSoft customers – although those knowledgeable about Oracle and PeopleSoft products know that an Oracle acquisition of PeopleSoft would impose on existing PeopleSoft customers significant new migration, software modification and re-implementation costs, increased resource demands, and substantial disruption to their businesses. For a substantial number of PeopleSoft customers, it would be impossible for them to convert to Oracle’s eBusiness product suite without also spending millions of dollars to buy an Oracle database solution, further complicating a change in their software applications. All would have to accept the less customized solutions offered by Oracle. None of these customers would be able to take advantage of planned upgrades and enhancements from PeopleSoft, since Oracle said it would discontinue those future product plans.

5. Despite the seemingly insurmountable obstacles to moving from PeopleSoft to Oracle’s competing application products, Oracle’s CEO promised a “graceful” migration to Oracle’s applications. An Oracle Executive Vice President stated that customers should not be concerned because Oracle would be utilizing yet-to-be built “very robust migration tools.” Such a promise of a “graceful” migration was not only false but also directly contrary to Oracle’s internal assessment. [In fact, internal Oracle documents demonstrate Oracle knew that any migration “can be messy.” A June 7, 2003 email also reveals that even Oracle’s own employees thought their CEO’s statements about migration were untrue: “I don’t mind [analysts] thumping us for being overly simplistic in

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migrating customers from PSFT to 11i [an Oracle product] – I’m sure it’s not as easy as LJE [Larry J. Ellison] was trying to make it sound like.”]

6. When Oracle received almost universally negative feedback to its Tender Offer, Oracle countered with a behind-the-scenes strategy designed to influence analysts to advise customers that they should delay making any decisions to purchase PeopleSoft products or services. [Oracle told at least one analyst that its report should include advising PeopleSoft customers against making purchasing decisions for PeopleSoft products; in the words of Peggy O’Neill, Vice President of Analyst Relations, writing to one analyst: “Obvious customer advice such as wait on purchases until this is over should be highlighted.” O’Neill also bragged to Chuck Phillips, “See how influenceable they are when we give them a little love! An email from Betty Cho, an Oracle marketing executive, to an industry analyst mentioned a “little birdie” within PeopleSoft who forwarded the marketing executive information about PeopleSoft’s public relations efforts.]

7. Oracle’s scheme to confuse the market worked. Analysts began suggesting that, in light of the uncertainty created by the Tender Offer, customers should postpone purchase decisions. Oracle immediately sent this information, and other wildly conflicting stories, to PeopleSoft’s current and prospective customers, conveying the message that it was too dangerous to commit to any PeopleSoft deal because, if Oracle succeeds in acquiring PeopleSoft, PeopleSoft and its products and services will disappear, to be replaced with Oracle’s applications (which conveniently enough run only on Oracle’s database platform). That effort paid off in part, as a number of PeopleSoft’s customers worldwide put transactions with PeopleSoft on hold until the Oracle cloud lifts, while others chose to proceed with competitors or to attempt to back out of executed contracts with PeopleSoft. Oracle has now made it clear it intends to keep that cloud intact well into 2004, and repeatedly makes the ominous claim that “time is on our side.”

8. Unless enjoined, Oracle’s continuing unfair trade practices will cause irreparable harm to PeopleSoft, to 13,000 PeopleSoft and J.D. Edwards employees, and to thousands of its innocent customers worldwide, for which PeopleSoft will have no adequate remedy at law.

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II. PARTIES

9. PeopleSoft is a Delaware corporation, incorporated in 1987. Approximately 3,500 of its over 8,000 employees work out of its principal place of business in Pleasanton, California. PeopleSoft is a leading developer and provider of software technologies and products that manage personnel, customer, and supplier relationships and business operations. PeopleSoft is and was at all times relevant herein qualified to do business in California.

10. J.D. Edwards is a Delaware corporation, founded in 1977. J.D. Edwards’ principal place of business is Denver, Colorado, and is and was at all times relevant herein qualified to do business in the State of California. J.D. Edwards is a leading developer and provider of software technologies and products designed to improve an organization’s internal operations. On July 18, 2003, PeopleSoft announced that it had successfully acquired over eighty eight-percent (88%) of the outstanding shares of J.D. Edwards pursuant to an exchange offer, and that it expected to acquire the remaining shares by the end of August, 2003.

11. Plaintiffs are informed and believe and on that basis allege that Defendant Oracle is a Delaware corporation with its principal place of business in Redwood City, California.

12. Plaintiffs are informed and believe and on that basis allege that Defendant Pepper Acquisition Corp. is a Delaware corporation formed by Defendant Oracle solely to receive shares in the Tender Offer, with its principal place of business in Redwood City, California.

13. Plaintiffs currently are unaware of the true names and capacities of Does 1 through 100, inclusive, whether individual, partnership, corporation, unincorporated association, or otherwise, and therefore sue these defendants by such fictitious names. Plaintiffs will amend this First Amended Complaint to allege their true names and capacities when ascertained.

14. Plaintiffs are informed and believe and on that basis allege that at all material times, each of the Defendants, including Does 1 through 100, was the agent, servant, employee, partner, joint venturer, representative, subsidiary, parent, affiliate, alter ego, or co-conspirator of the others, that in doing the things hereafter alleged, each was acting within the scope of such agency, service, employment, partnership, joint venture, representation, affiliation, or conspiracy, and that each is legally responsible for the acts and omissions of the others.

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III. JURISDICTION AND VENUE

15. Plaintiff PeopleSoft resides in the County of Alameda. Plaintiff J.D. Edwards does business in this County and all Defendants have the necessary minimum contacts with this forum for the Court to exercise personal jurisdiction. In addition, liability arose in Alameda County.

16. The amount in controversy exceeds the minimum for unlimited civil jurisdiction of this Court.

IV. FACTUAL ALLEGATIONS

17. On June 2, 2003, PeopleSoft announced that it had reached a definitive agreement to merge with J.D. Edwards in a $1.7 billion stock-for-stock transaction. The PeopleSoft and J.D. Edwards combination results in the world’s second largest enterprise applications software company, displacing Defendant Oracle from that position.

18. On Friday, June 6, 2003, only four days after the merger announcement, Oracle announced that it planned to commence the Tender Offer the following Monday. The $16 cash offer was a mere 5.9% above the previous day’s closing market price of $15.11 per share and approximately $0.50 per share lower than PeopleSoft’s 30-day high. On June 9, 2003, Oracle formally commenced the Tender Offer. Oracle’s CEO described this move as a “war game in a box” that had been “pre-scripted” in case PeopleSoft agreed to merge with J.D. Edwards.

19. Oracle launched its hostile takeover of PeopleSoft with a promise to scrap PeopleSoft’s “best of breed” software products. Oracle’s CEO, Larry Ellison, who had proclaimed “best of breed is dead, except for dog shows,” announced that Oracle would cease selling PeopleSoft’s products to new customers. Oracle’s CFO, Jeff Henley, told a press conference that Oracle did not intend to “keep [PeopleSoft] alive.” Oracle’s Executive Vice President admitted that PeopleSoft’s products would be placed in “maintenance mode,” but customers should not be concerned because Oracle was going to offer “as graceful of a migration path as possible.” [Oracle’s Executive Vice President and a member of its Board, Safra Catz, admitted in an internal email: “we really won’t be continuing [PeopleSoft’s] product line.”]

20. By initially announcing that Oracle intended to retire PeopleSoft’s acclaimed software applications and issuing numerous false and misleading statements under the pretense of a hostile

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tender offer, Oracle hoped to harm PeopleSoft as a competitor in the applications software space, adversely affect PeopleSoft’s sales, poach PeopleSoft’s prospective customers, and otherwise interfere with PeopleSoft’s customer relationships through a concerted campaign of fear, uncertainty and doubt.

21. Oracle’s scheme was so transparent that shortly after it was announced, its seriousness was widely questioned by industry observers. As Mark Veverka said in a Barron’s Online article dated June 9, 2003, analysts and investment bankers “seem to agree that [Oracle CEO Larry] Ellison is not terribly serious about buying PeopleSoft,” but “by making a run at the company through an offer that was market value in cash, Ellison at the very least can create confusion, uncertainty and chaos among the customers and employees of both PeopleSoft and J.D. Edwards.” Says Jeff Matthews, general partner at Ram Partners, a Greenwich, Connecticut-based hedge fund: “[I]t sounds like they want to shut down PeopleSoft almost entirely. This isn’t a takeover; it’s a hostage-taking.” Those views are perhaps guided by Mr. Ellison’s prior forays into hostile takeover attempts of Apple Computer (where he launched and quickly withdrew what he called a “trial balloon”), and Gupta Corporation (where he moved to acquire the company ostensibly to improve Oracle’s low-end product line, and then later abandoned the unsolicited bid while still making a profit). Ellison has been misleading with regard to his interest in J.D. Edwards, as well. Oracle initially sued PeopleSoft to block the J.D. Edwards acquisition, and inserted a condition in its Tender Offer that would have allowed Oracle to abandon the Tender Offer in the event PeopleSoft acquired J.D. Edwards by issuing new shares of PeopleSoft stock. As well, Ellison publicly disparaged and belittled J.D. Edwards, injecting confusion into J.D. Edwards’ customer base due to the perception that Oracle’s acquisition of PeopleSoft might result in the cancellation of the PeopleSoft-J.D. Edwards merger agreement. After analysts and industry observers denounced the Tender Offer as a transparent effort to disrupt PeopleSoft’s acquisition of J.D. Edwards – and after this lawsuit was first filed – Ellison suddenly changed course, stating that he “would love to have both PeopleSoft and J.D. Edwards.” [In fact, Ellison never disclosed the extent to which Oracle had been considering the possible acquisition of J.D. Edwards in the months immediately preceding PeopleSoft’s announcement of its acquisition of J.D. Edwards, and that its investment bankers had made confidential

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presentations to Oracle management as early as the Fall of 2002, concerning a possible strategic relationship with J.D. Edwards.]

22. Mr. Ellison recently proclaimed “with or without us, PeopleSoft cannot survive.” PeopleSoft is informed and believes, and thereon alleges, that Ellison also has told PeopleSoft customers directly that PeopleSoft is “dead.” Oracle’s tactics demonstrate that Oracle is following its CEO’s command to destroy PeopleSoft. [As part of its orchestrated “war game in a box,” Oracle mistakenly assumed it would have ten days to launch an assault on PeopleSoft’s customer base without being impeded by PeopleSoft because under federal law, PeopleSoft had ten days to consider the offer before responding to it. Thus, Oracle’s strategy included immediately contacting industry analysts in an attempt to influence their views. As O’Neill, who worked on influencing industry analysts, put it: “Therefore, we have this 10-day window to actively talk with analysts and PSFT won’t be in a position to answer back.”]

23. [Internal Oracle documents reveal that the purpose of this attempt to mold the opinions of the industry analysts was at least two-fold. First, Oracle hoped to convince the industry analysts that moving from their PeopleSoft products to Oracle products was somehow good for the customer. Second, Oracle took the view that anything that could hurt PeopleSoft in the marketplace could drive down the price of PeopleSoft stock, thereby making Oracle’s low-ball offer appear attractive to PeopleSoft’s stockholders.]

24. Oracle knows – but has studiously failed to disclose to the public – that there are potentially insurmountable barriers to consummating the Tender Offer. Indeed, buried in the documents filed with the SEC which describe the Tender Offer is the fact that Oracle is under no obligation to purchase a single tendered PeopleSoft share should it determine that (a) the disruption to PeopleSoft’s sales and business – disruption that Oracle itself is causing by launching the Tender Offer and engaging in the unfair trade practices directed at PeopleSoft and its customers – is a “materially adverse” development, or (b) “the value of the [PeopleSoft] shares to us” has materially lessened. These facts reveal the Tender Offer to be completely illusory, and further expose the motivation behind it. Nevertheless, Oracle’s management continued to mislead the market, and PeopleSoft customers, concerning the hugely conditional nature of its Tender Offer. As Oracle’s

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CFO, Jeff Henley, obscurely noted in Oracle’s June 16 conference call, “if all those conditions are met, I think it’s an unconditional offer.” By launching its offer near the close of PeopleSoft’s second fiscal quarter, Oracle designed it to cause maximum harm to PeopleSoft by trying to impair PeopleSoft’s financial results for the quarter, possibly causing PeopleSoft’s stock price to decrease. Should that happen in the future, Oracle can claim a “materially adverse” development that lessens the “value to us” of PeopleSoft’s shares, and then just walk away from the Tender Offer without having purchased a single share.

25. Lastly, Oracle faces a formidable barrier in its attempt to eliminate competition through its hostile tender offer: the federal and state antitrust laws. Oracle’s plans are undergoing a rigorous analysis by skeptical government regulators and attorneys, and the outcome of its mandatory antitrust review is in serious doubt. Despite its early pronouncements of a “highly fragmented” market and claims that its Tender Offer presented no antitrust difficulties, on June 30, 2003, the antitrust division of the United States Department of Justice issued its “second request” – indicating that the proposed transaction will receive heightened antitrust scrutiny and could potentially be blocked - seeking extensive additional information necessary for its investigation. Earlier, on June 18, 2003, Connecticut’s Governor, Attorney General, and Comptroller announced they had filed an antitrust lawsuit against Oracle to block the hostile takeover of PeopleSoft, noting in their press release that Oracle’s proposed takeover “would violate state and federal anti-trust laws, directly damage the state and its economy, and raise prices for businesses, governments and consumers by significantly reducing competition in the markets PeopleSoft serves and forcing current PeopleSoft customers to replace their software with other companies’ products.” That press release also announced the assembly of a “powerful coalition of states and other consumers that will suffer the same unacceptable costs if this unlawful, anti-competitive takeover is permitted.” It was subsequently announced on August 1, 2003, that Attorneys General from approximately 30 states had formally agreed to cooperate in an antitrust investigation of Oracle’s hostile tender offer. In addition, CNET reported on August 8, 2003, that “Oracle’s hostile bid for PeopleSoft is currently under review by Canadian antitrust regulators,” who began their review “shortly after the software company announced its plans in June to acquire competitor PeopleSoft in a hostile bid.” Meta Group, an

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industry analysis firm, stated on July 23, 2003, that among the “numerous obstacles that make [the tender offer] unlikely to be consummated in its current form” is that a ruling from the Justice Department is still “3-6 months away.”

A. Customer And Industry Reaction To The Tender Offer

26. Oracle’s initial announcement caused a firestorm of hostile customer and prospective customer reaction, especially because Oracle had essentially announced that multi-million-dollar investments in enterprise software by PeopleSoft’s thousands of customers would be in severe jeopardy, that customers who had earlier considered and rejected Oracle’s troubled application products would ultimately be forced to “migrate” to Oracle’s products, and those customers who did not utilize Oracle’s database products would be forced to switch database platforms as well as migrate their applications..

27. Industry groups also noted the enormous threat posed by Oracle. As one worried customer told Dow Jones Business News, switching to Oracle will be “almost like starting over.”

The Higher Education User Group issued a press release advising that:

[Oracle’s] threat to terminate development of our higher education applications is appalling. The offer to help us migrate our applications onto a different suite is unacceptable in terms of impact to our students, to our faculty, and to our staff,” stated Ola Faucher, HUEG President. “A migration to an ERP suite we purposely did not choose in the first place would force our institutions to expend vast amounts of money, precious staff time and talent, and place our core business processes at risk.

The Distributors and Manufacturers User Group issued its own press release, opining that:

Oracle must have very little respect for PeopleSoft’s customers to believe that any manufacturing organization running mission-critical applications could ‘gracefully’ switch from one vendor’s application suite to another at minimal cost. Oracle’s declared strategy would cost manufacturing customers millions of dollars and disrupt their operations.

In a press release, the International Customer Advisory Board, an independent 17 member organization representing PeopleSoft’s 5,100 customers worldwide, stated that:

Oracle’s expressed intention to discontinue the PeopleSoft product line is of grave concern to organizations that have chosen PeopleSoft applications to run their businesses. We feel strongly that an Oracle acquisition of PeopleSoft would reduce competition and force PeopleSoft users to migrate from their current applications and possibly database platforms — this unnecessary, expensive and risky effort is clearly not in the best interest of PeopleSoft customers.

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Similarly, Quest, the J.D. Edwards User Group, an independent organization representing J.D. Edwards users in more the 50 countries, came out in favor of PeopleSoft’s merger with J.D. Edwards and against the Oracle takeover bid, stating:

We believe the Oracle deal would significantly reduce the number and quality of choices for consumers of enterprise software and, ultimately, substantially harm the members of our organization. . . .The ‘sound bites’ from Oracle’s upper management suggest that this deal is not intended to benefit consumers by enhancing the current product offerings of either company, but rather to remove one competitor from the marketplace. The loser in the end won’t be J.D. Edwards, PeopleSoft or Oracle. It will be users, such as those represented by Quest.

The Healthcare Industry User Group has likewise noted its opposition to the deal:

[Oracle’s] offer to help us migrate our applications to a different suite is anything but reassuring. . . .At a time when 44 million Americans remain uninsured and the economy is in a downturn, healthcare institutions have a responsibility to use their resources wisely. Investing millions of dollars migrating to an ERP solution that most of us did not choose in the first place is clearly not in our best interest. In addition to the monetary investment, the training time for staff would pose a real threat of placing our core business processes at risk.

28. In what several prominent news organizations and analysts have branded “backpedaling,” Oracle in recent weeks has begun issuing announcements that it was now “committed” to supporting PeopleSoft products, but without (a) retracting its earlier statements and (b) providing any meaningful detail as to what its new “commitment” entails. Despite its public statements and advertisements that it would provide “flexible upgrades” for PeopleSoft products, Oracle never has said what that means, because it candidly does not intend to provide such upgrades—only “maintenance mode.” As one industry observer has stated, if Oracle stops upgrading the PeopleSoft product line, “in this industry that is a quick death.”

B. Market Reaction To The Tender Offer

29. Market reaction to the announcement of the Tender Offer was swift and decisive. The market considered the price offered by Oracle for PeopleSoft shares to be significantly lower than their true value – an attempt to “lowball” PeopleSoft’s shareholders. In the hours following Oracle’s announcement, the market price of PeopleSoft’s shares increased in value by over 23%, finally closing on June 6, 2003, at $17.82, an increase of almost 18% over the previous day’s close and $1.82 (11.4%) higher than Oracle’s $16 per share offer.

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30. Oracle’s machinations did not escape notice by commentators and analysts, who agreed that Oracle’s initial offer was not serious, and Oracle’s stated intention to eliminate PeopleSoft’s products on completion of the Tender Offer was designed to, and likely would have, a chilling effect on PeopleSoft’s existing and potential customers, perhaps causing them either to abandon PeopleSoft altogether or delay new sales and product upgrades until the fate of the company is clarified. In one particularly memorable June 16, 2003 news conference, Oracle’s harried executives were met with a firestorm of criticism so extensive that Oracle did not post the transcript on its website, claiming falsely that “technical difficulties” prevented it from doing so. The truth is Oracle had a transcript of that session, but chose not to publish it on its web site because of the harsh nature of the questions posed by analysts and the press. The full transcript, which Oracle only recently produced to PeopleSoft as “confidential,” is revealing. [One analyst advised Chuck Phillips and Jeff Henley that Oracle’s bid was “dramatically under-valued”; he was happy PeopleSoft was fighting back “because you guys were screwing with their business”; “if you made a real bid, it would be a different story”; what the Oracle executives were saying “sounds ridiculous”; this “was a bullshit bid – using the vernacular, okay?”; and a recent Wall Street Journal article was correct in saying that “Larry Ellison is not real, that he does this all the time, that he makes B.S. things and then doesn’t follow through on them.” Another analyst continued the harsh observations about Oracle: “you’re illustrating exactly why a lot of people don’t like your company . . . no one supports you, no one believes you.” One analyst was cut off by Oracle when he said Oracle was “appealing to the lowest common denominator of short term shareholder’s interest,” and that Oracle was proving “that all you’re trying to do is disrupt” the J.D. Edwards merger. An additional questioner observed, “If I was a PeopleSoft customer right now, I would probably be pretty unhappy that I have to go through a very expensive migration over to Oracle.” One participant noted that “the approach you’re trying to work now . . . appears to me to continue to badmouth PoepleSoft.” The relentless criticism finally prompted Henley to note that he was “running out of patience” with the questions he was receiving.] As reported in the Wall Street Journal, Oracle’s Phillips acknowledged that “from the very first meeting, there were fingers pointed in my face.”

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31. In light of the furious reaction of financial and market analysts, Oracle succumbed to the ridicule and raised its offer to $19.50, falsely claiming that it did so because the feedback it had received from PeopleSoft shareholders indicated that a $19.50 price was appropriate. In fact, as of August 8, 2003, only about 10% of PeopleSoft stockholders has found this price attractive enough to cause them to tender their shares to Oracle, and there is no reason to believe that Oracle’s Tender Offer will ever be consummated. Nevertheless, Oracle persists with its “customer outreach campaign” to disrupt PeopleSoft customer relationships, under the guise of its clearly inadequate Tender Offer.

C. Oracle’s False, Misleading And Deceptive Statements And Omissions

32. Oracle’s false, misleading and deceptive statements and omissions have included: (i) mischaracterizing what Oracle initially told the public about its plans to stop selling PeopleSoft products; (ii) mischaracterizing or omitting vital information about PeopleSoft’s products; (iii) mischaracterizing or omitting vital information about Oracle’s ability to provide support to PeopleSoft’s customers; (iv) mischaracterizing or omitting vital information about the cost to PeopleSoft customers of its plan to “migrate” them to Oracle; (v) mischaracterizing or omitting vital information about its true intentions vis-à-vis PeopleSoft and its products; and (vi) failing to disclose that government regulators are unlikely to allow Oracle to acquire PeopleSoft. The following Oracle statements are representative of the false, misleading, and deceptive statements Oracle has made:

a. In its conference call of June 6, 2003, called ostensibly to announce its offer to purchase stock from shareholders, Oracle directed its focus to PeopleSoft’s customers. Thus, Oracle claimed “[PeopleSoft customers] will also be offered a no extra license charge [sic], a product migration to the equivalent Oracle product.” This statement is false, misleading, and likely to deceive PeopleSoft customers, and omits critical information which Oracle knows is vital to PeopleSoft customers. The license charge is only one relatively small part of the total cost of ownership of software that businesses use to run their enterprises. PeopleSoft’s customers will have to incur consulting, integration, and conversion costs, over and above any waived license fee, and those costs will be substantial. A substantial portion of PeopleSoft’s current customers who do not run their PeopleSoft products on the Oracle database would

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have to purchase and switch to an entirely new database, potentially costing them millions of dollars in out-of-pocket costs, along with the attendant business disruption costs that would result from such a massive undertaking.

b. Oracle also claimed during that call: “Though we will not be actively selling PeopleSoft products to new customers, we will provide enhanced support for all PeopleSoft products . . . . For PeopleSoft customers, we’ll provide enhanced support and make it easy for them to upgrade to a broader and fully integrated E-business suite . . . One of the things we’re going to do immediately is improve the quality of support.” In addition, in an amendment to Oracle’s Tender Offer Statement filed with the SEC on June 10 (the “June 10 Amendment”), Oracle stated that “Customer support will improve.” These statements are false, misleading, and likely to deceive PeopleSoft customers, and they omit critical information which Oracle knows is vital to PeopleSoft customers. Oracle has no basis for its claim that it will provide enhanced support – especially if Oracle fires the bulk of PeopleSoft’s employees, as its CEO has predicted, or those employees simply refuse employment with Oracle. Moreover, Oracle has omitted critical information about which PeopleSoft customers will be entitled to upgrade rights, and which will be stranded with a product Oracle will eliminate; Oracle has not disclosed whether, for example, new PeopleSoft customers who sign contracts after the Tender Offer commenced will be entitled to upgrade rights, or whether these new customers will become an “orphan” class of PeopleSoft customers. Further, Oracle’s support for its own products leaves much to be desired, and Oracle will be hard pressed to show how it can “enhance or “improve” PeopleSoft’s best of breed support of its own products.

c. Oracle also stated on the June 6 call: “PeopleSoft customers will benefit from having access to a migration path that will be optimized for moving to a broader and more fully integrated E-business suite” and “PeopleSoft’s development team will also build the upgrade migration scripts from PeopleSoft products to the Oracle E-Business Suite.” These statements are false, misleading, and likely to deceive PeopleSoft customers, and omit facts which render them deceptive and misleading. Oracle’s subsequent public statements falsely

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claimed it did not intend to migrate customers from their chosen PeopleSoft “best of breed” products to Oracle products and falsely claimed its public record statements had been “misconstrued.” Further, Oracle applications only run on Oracle’s database and application server. Moreover, as with all hostile takeovers, there is no guarantee that Oracle will have a “PeopleSoft development team” to create such a “migration path.” [Indeed, an email from Chuck Phillips to a PeopleSoft customer states that “migrating between releases is never cost free,” and that migration is “not magic and will require some consulting for the considerable future.” In addition, Phillips stated, “You are correct that migrating between releases is never cost free and consulting is involved. We never said otherwise and that’s a fact of life as anyone remotely familiar with software knows.” Oracle documents produced to date show that, rather than being “easy” or “graceful,” the migration of PeopleSoft customers to the Oracle platform was being described as “messy” – and certainly “not as easy” as Ellison and other top Oracle management was publicly stating.] Despite these internal acknowledgements that the migration of PeopleSoft customers to the Oracle platform would be extremely time consuming and costly, Larry Ellison nevertheless continued to push the plan to talk to PeopleSoft customers about how “to make migration easy.”

d. Oracle’s statements that its migration path for PeopleSoft customers would be “graceful” and “easy” also are false and misleading because they fail to disclose that the true costs of a complex migration from PeopleSoft to Oracle applications could be millions of dollars per customer. As the Meta Group observed in a research report dated June 6, 2003 such a migration “would require about 80% of the original work and effort of a wholly new” enterprise software installation. Oracle has offered PeopleSoft customers “free licenses” for Oracle’s enterprise software applications, while downplaying the significant cost customers would face to purchase the Oracle database platform, and to otherwise migrate to the Oracle platform. These massive additional and unplanned migration costs may cost hundreds of millions of dollars to public institutions and state and local government agencies in the State of California alone, and adversely affect California citizens and taxpayers who ultimately will

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be required to shoulder the financial burden of these unforeseen expenses. Similar migration costs may be incurred by public institutions in other states throughout the United States.

e. Oracle also represented on the June 6 call: “most PeopleSoft customers are running on the Oracle database, so immediately we can provide one-stop support supporting both their applications and their install [sic] base.” This statement is false, misleading, and likely to deceive PeopleSoft customers, and omits critical information which Oracle knows is vital to PeopleSoft customers. A substantial portion of PeopleSoft’s current customers do not run their PeopleSoft products on the Oracle database and may have to purchase and switch to an entirely new database, potentially costing them millions of dollars. All will suffer disruption to their business because of a conversion to new, often mission-critical systems. In addition, the statement omits to disclose that even customers who run their PeopleSoft products on the Oracle database have customized the software extensively, and such customization may be difficult for Oracle to support even if the customer is on an Oracle database.

f. On the June 6 call, Oracle promised to make the migration from PeopleSoft 7 to Oracle’s E-business suite “easy” and “graceful.” This statement is false, misleading, and likely to deceive PeopleSoft customers, and omits critical information which Oracle knows is vital to PeopleSoft customers. First, it runs directly contrary to Oracle’s later claims that it does not intend to “migrate” PeopleSoft customers to Oracle products. Numerous industry experts have scoffed at these “easy” and “graceful” claims as 2003 examples of Oracle’s legendary practice of selling products and services that do not exist. A substantial portion of PeopleSoft’s current customers do not run their PeopleSoft products on the Oracle database and will have to purchase and switch to an entirely new database, potentially costing them millions of dollars and disrupting legions of other software programs and solutions running on their existing database. The claim also relies on the unwarranted assumption Oracle will be able to hire the “top” PeopleSoft developers necessary for such a migration.

g. On the June 6 call, Oracle made the following present tense statement: “We’re also taking some of the top PeopleSoft developers . . . .” This is false, misleading, and likely to

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deceive PeopleSoft customers, and omits critical information which Oracle knows is vital to PeopleSoft customers. Oracle has taken none of PeopleSoft’s developers pursuant to its Tender Offer, let alone any of its “top” developers.

h. Oracle stated in the June 10 Amendment: “Many members of the PeopleSoft product development team will join the Oracle development organization to ensure that subsequent versions of the Oracle E-Business Suite will have the best features from both product families and benefit from the contributions of those developers to enhance our products.” This statement is false, misleading, and likely to deceive PeopleSoft customers, and omits critical information which Oracle knows is vital to PeopleSoft customers. Oracle has no basis for its claims that many members of PeopleSoft’s product development team “will” be joining Oracle at any time, and Oracle fails to disclose that if such PeopleSoft employees do not choose to work for Oracle, its professed plan to integrate “the best features from both product families” will fail.

i. Oracle’s Ellison also stated on the June 6 call: “[i]t’s not easy to move from PeopleSoft 7 to PeopleSoft 8. Just going from PeopleSoft 7 to PeopleSoft 8 is a major, major effort.” Ellison went on to claim “It’s certainly as easy as going from PeopleSoft 7 to PeopleSoft 8, moving to Oracle products.” These statements are false, misleading, and likely to deceive PeopleSoft customers, and omit critical information which Oracle knows is vital to PeopleSoft customers. Oracle has no basis for its claims that it is just as “easy” to switch to a very different Oracle product, with its different platform and user interfaces. [In fact, contemporaneous internal Oracle documents show that on June 7, 2003, Peggy O’Neill emailed Chuck Phillips to say that “analysts [were] dinging [Oracle] for glossing over that very same migration.” She conceded that “depending on how we do it, the migration can be messy, and they’re calling us on it.”]

j. Oracle also stated on the June 6 call: “we’re not going to push the PeopleSoft customers to move to Oracle . . . . [O]ur intention is to improve and extend the support services to [PeopleSoft’s] customers.” This statement is false, misleading, and likely to deceive PeopleSoft customers, and omits critical information which Oracle knows is vital to

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PeopleSoft customers. Oracle announced that it plans to eliminate the PeopleSoft product line – requiring PeopleSoft’s customers to change to some other product – and has offered its software for “free.” Indeed, Oracle betrayed its real intent later in the call: “we’ll try to figure out how many [PeopleSoft customers] are moving from PeopleSoft 7 to PeopleSoft 8, assess an interest [in] how many want to move to the Oracle E-business suite and how soon.” Oracle sales representatives have also advised customers that Oracle will “within time migrate PeopleSoft customers over to Oracle,” and “all future products will be offered on the Oracle platform.”

k. In its June 9, 2003, Offer to Purchase, available on Oracle’s web-site and filed with the SEC, Oracle reiterated many of the false, misleading, and/or deceptive statements discussed above. Oracle stated that it will be “providing enhanced and extended support for the Company’s products, incorporating advanced features from the Company’s products into future versions of the Oracle eBusiness Suite, facilitating the migration path for the Company’s customers from the Company’s products to the Oracle eBusiness Suite . . . .” For the reasons discussed above, these statements are false, misleading, and likely to deceive PeopleSoft customers, and omit critical information which Oracle knows is vital to PeopleSoft customers.

l. Oracle was widely criticized for its initial position it intended to buy and then kill off PeopleSoft. Oracle’s reaction was to backpedal and then claim it had been misquoted or its statements misconstrued. The July 14, 2003 Daily Deal put it succinctly: “After capturing international headlines by initially blurting out that Oracle Corp. would shutter rival PeopleSoft Inc. and scrap its line of enterprise software products should its hostile bid succeed, Oracle’s CEO Larry Ellison has been energetically backpedaling.” That Oracle backpedaling went so far as to include during a July 17 “Town Hall” meeting for PeopleSoft customers, a claim by Oracle’s Chuck Phillips that Oracle had never said it would not sell PeopleSoft products to new customers and was actually going to continue to improve and enhance PeopleSoft products. The truth was that Phillips himself had told the press earlier that PeopleSoft’s products would be put in “maintenance mode” by Oracle, and Oracle’s CEO

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had told the public the products would not be sold to new customers. [Moreover, Ellison’s “right hand” executive, Safra Catz, sent an email on June 6, 2003 stating unequivocally that “we really won’t be continuing their product line.” Internal Oracle documents indicate that it was proposed that when a “customer inquires about buying PeopleSoft products from Oracle,” Oracle’s response should be that “Oracle will not sell PeopleSoft products to new customers.”]

m. Oracle also falsely communicated to PeopleSoft customers that its ability to successfully complete the very complex integration of PeopleSoft features and functions into existing Oracle database and applications products is fairly demonstrated by its previous experience in managing the support and integration of the RDB database platform acquired from Digital Electronics Corporation in 1994. For example, in a press release dated June 20, 2003, targeted to PeopleSoft customers, Larry Ellison sought to assure customers by saying “We know how to do this. Ask any customer from our RDB database acquisition from Digital Equipment Corporation. Nearly nine years later, we are still providing world-class support to thousands of RDB customers running mission-critical applications.” Similarly, in its “PeopleSoft Customers Town Hall” on July 17, 2003, Chuck Phillips cited Oracle’s continuing support for RDB as an example to PeopleSoft customers that “there’s no risk to your PeopleSoft IT investment.” Contrary to these false assurances that Oracle could handle a complex integration project, Oracle and its senior management failed to disclose the disastrous failed integration effort the company attempted and abandoned with its “Oracle CPG” product. This product, launched in 1996, was an attempt to create an enterprise software solution tailored to the needs of consumer packaged goods producers, including customers such as Tri-Valley Growers and Kellogs. The CPG product was so flawed and problematic that Oracle instructed customers to abandon the product in October 2000, in the midst of customer lawsuits and widespread adverse publicity. Ellison admitted publicly that the Oracle CPG product was a “huge mistake,” and a Tri-Valley IT manager, speaking to the press after Tri-Valley went bankrupt, referred to the integration effort as “very tragic.” Oracle

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not once mentioned this horrific integration fiasco in its communications with PeopleSoft customers.

n. Oracle’s campaign of deception even included deception about its own product plans. [Notwithstanding Oracle’s repeated claims that it now intends to support PeopleSoft’s products, the highest levels within Oracle decided to hide from the public Oracle’s own decision to announce a “desupport date for [Oracle’s] 11.0.” As Oracle’s spokesperson, Jim Finn, put it in an internal email, announcing Oracle’s decision to cease support of its own older product “would be the wrong signal to customers and would be seized upon by PSFT and their advisors to counter Larry’s assertions that PSFT customers can take their time upgrading to ORCL. Bad optics.”]

o. Oracle repeatedly represented to the market that its application business was thriving in comparison to PeopleSoft’s, and that it was winning in head-to-head competition with PeopleSoft. In truth, Oracle’s application business was down 8% from the last fiscal year, and over the last three years, Oracle’s applications licensing revenue had declined by almost 25%, while PeopleSoft’s increased by approximately 3 ¹/2%. [Further, at the time Ellison was making these claims, he was the recipient of an internal email showing that over the past year, Oracle was losing in head-to-head competition with PeopleSoft.]

p. On June 17, 2003, Larry Ellison observed that Oracle’s hostile tender offer for PeopleSoft posed “no antitrust concern.” This statement is false and misleading, because on July 1, 2003, after the Justice Department had issued a “second request” for information related to the Tender Offer – a development that forced Oracle to abandon its challenge to the J.D. Edwards acquisition, and to put off indefinitely its request for a hearing in the Delaware litigation it had commenced – Ellison admitted that Oracle had “expected” this development.

33. Oracle also launched full-page ads in, and provided interviews for, several major periodicals, including the Wall Street Journal and the New York Times, containing numerous false and misleading statements. By way of example:

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a. Oracle’s CEO attacked PeopleSoft’s shareholder rights plan, claiming it should be “outlawed,” while failing to disclose that Oracle itself had a more restrictive shareholder rights plan;

b. Oracle claimed that PeopleSoft directors were selling shares while advising shareholders not to tender theirs, knowing full well that (a) only a single director had sold; and (b) that director was selling pursuant to a non-discretionary and publicly-disclosed plan under a safe harbor provision promulgated by the Securities and Exchange Commission;

c. Oracle charged PeopleSoft with forming special purpose entities to “bury R&D expenses and distort financial statements,” apparently hoping to tar PeopleSoft with an Enron-type scandal, when the only possible transaction that could even remotely be described as a “special purpose entity” was a spin-off made in January 1999, a spin-off that had been reviewed with the SEC beforehand, was the subject of full and extensive public disclosure and which, in any event, was no longer in existence as of late 2002; and

d. Oracle claimed that PeopleSoft had launched a “double your money back guarantee” for customers designed as a “poison pill,” however, the trigger for payments under that program would never take place unless Oracle was lying about its intention to fully support PeopleSoft’s products.

D. Oracle Has Interfered With PeopleSoft’s Contracts And Prospective Economic Advantage

34. Oracle’s scheme is and was to force a delay or impede PeopleSoft’s signing of a number of customer contracts, which would lead to lower-than-expected license revenues. Dow Jones Business News reports that Oracle Executive Vice President Chuck Phillips “defended the $16 a share price tag, saying PeopleSoft shares could drift lower in coming weeks.” CBS Market Watch reported an analyst’s prediction that: “[A]s PeopleSoft approaches the end of its second quarter, . .. . the company will have trouble meeting sales targets as confusion about the Oracle and J.D. Edwards bids scares away would-be customers. As a result, the company’s stock will suffer, and Oracle’s current offer might look a lot more appealing.” [Internal Oracle documents confirm this was Oracle’s plan: hurt PeopleSoft enough such that Oracle’s bid looked attractive. Analyst relations

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specialist O’Neill quoted Chuck Phillips as boasting, “time is on our side, because the more time goes on, the less likely another suitor emerges, the more likely people start worrying about what will happen to the future of PSFT, as the JDE merger is expected to close in the fall. We might force PSFT to change their JDE terms to a cash deal to accelerate things, who knows? That could hurt PSFT too, and again, the more something hurts PSFT, the more likely that share price drops and $16 starts looking better.” She also crowed that “PSFT is in disarray.”]

35. While the Tender Offer is ostensibly directed at PeopleSoft’s shareholders, Oracle has directed the bulk of its activities at PeopleSoft’s customers. Oracle has acted to intentionally interfere with PeopleSoft’s contracts and with PeopleSoft’s prospective economic advantage, and among other things:

a. On June 23, 2003, a Vice President of an Oracle subsidiary wrote to PeopleSoft Customer A, enclosing a “document, which [Oracle] consider[s] very important for [Customer A] to take into consideration during your process of evaluation [of a Human Resources product].” The document was the Gartner report which (i) advised those considering a purchase of PeopleSoft or J.D. Edwards products not to “sign a deal unless it becomes clear whether Oracle’s plans to acquire PeopleSoft are serious”; (ii) noted that PeopleSoft will feel a “short-term negative impact on revenue as customers delay purchase and upgrade decisions”; (iii) opined that “Oracle will benefit by removing an enterprise application competitor”; and (iv) concluded that “Oracle will not support any PeopleSoft products in the long term,” and thus “in building any exit strategy, PeopleSoft customers should evaluate how long installed products will support their business needs and should understand what migration plans Oracle will suffer.” This report sent out by Oracle also advised customers to breach their contracts with PeopleSoft: “Those that recently decided to upgrade to v.8 [of PeopleSoft’s product] should reconsider since Oracle will likely provide only minimal enhancements to v.8.” PeopleSoft is informed and believes and thereon alleges that Oracle widely disseminated this report and others which advised customers not to purchase or to delay purchases of PeopleSoft products in light of Oracle’s hostile tender offer;

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b. On June 6, 2003, the same day Oracle announced its intention to launch its hostile Tender Offer, an Oracle representative contacted Customer B and told the customer it would be “dangerous” to purchase a PeopleSoft portal solution in light of the Tender Offer. PeopleSoft is informed and believes and thereon alleges that Oracle’s sales representatives and agents made the same and similar remarks to numerous other PeopleSoft customers and prospective customers;

c. On June 27, 2003, an Oracle employee emailed PeopleSoft Customer C and advised that Oracle understood Customer C was currently going through a roll-out of PeopleSoft software, and that Oracle would “within time migrate PeopleSoft customers over to Oracle,” and that “all future products will be offered on the Oracle platform.” PeopleSoft is informed and believes and thereon alleges that Oracle’s sales representatives and agents made the same and similar remarks to numerous other PeopleSoft customers and prospective customers; and

d. PeopleSoft is informed and believes and thereon alleges that Oracles sales representatives and agents informed numerous other PeopleSoft customers and prospective customers of the Tender Offer and its effect on PeopleSoft’s products and services, thereby causing customers to delay or cancel planned purchases. Among those purchases delayed or cancelled were contracts valued at more than $170 million with two public sector entities, Customers D and E.

E. The Unfair Practices – Including Oracle’s False, Misleading And Deceptive Statements – Are An Illegal Attempt To Mislead PeopleSoft Customers And To Interfere With PeopleSoft’s Customer Relationships

36. Oracle’s media blitz and contacts with PeopleSoft customers about the Tender Offer – ostensibly aimed at PeopleSoft’s shareholders but really directed at PeopleSoft’s current and potential customers – is an attempt to confuse those customers, and foster a climate of fear, uncertainty and chaos to harm PeopleSoft’s business. The uncertainty and volatility caused by these statements – especially those that threaten to eliminate PeopleSoft’s products – are meant to hurt PeopleSoft’s sales by causing customers to delay buying or upgrading PeopleSoft software – if not to facilitate stealing customers from PeopleSoft outright.

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37. Oracle’s remarks did not fall on deaf ears among PeopleSoft’s competitors. In a June 6, 2003 email to his employees with the subject line “Too Good To Be True,” Siebel Systems, Inc. CEO Tom Siebel stated: “[I]t appears that Oracle will end-of-life the PeopleSoft product line . . . . I should think that many customers and prospects would find this a matter of some concern.” German software maker SAP stepped into the fray, launching a campaign, including personal contacts and advertising, to woo PeopleSoft’s customers frozen in the wake of the statements Oracle has directed at them under the guise of its Tender Offer. SAP’s president of global field operations told the Wall Street Journal Europe that SAP sales people began contacting PeopleSoft’s customers about its offer – which includes “financial incentives” to switch customers to SAP – on Tuesday, June 10.

38. Having designed its Tender Offer and its “plans” for PeopleSoft as a vehicle packed with misrepresentations and deceptions meant to disrupt PeopleSoft’s ongoing business, Oracle immediately commenced a concerted campaign to ensure maximum damage to PeopleSoft’s business and wreck PeopleSoft’s financial results. Within minutes after having announced the Tender Offer – in some cases even before – Oracle began communicating directly with PeopleSoft customers. To make sure those customers didn’t miss the significance of Oracle’s expressed intention to retire PeopleSoft’s products – and to cease support for any future enhancements PeopleSoft has planned – Oracle employees have begun calling PeopleSoft’s current and prospective customers to deliver the message. In an Oracle email sent to “Oracle Employees,” and subsequently filed with the SEC, Jeff Henley directed Oracle employees to contact PeopleSoft customers and to engage Oracle executives in targeting “senior management at key customers around the world.” [In an email entitled “Marketing Campaign re: PSFT Acquisition,” Oracle executives discussed special training for Oracle’s sales force for dealing with PeopleSoft Customers so that “sales can immediately capitalize on potential customer interest.”]

39. Just as Oracle intended, this campaign of interference had an immediate impact on a number of PeopleSoft customers. Customer F, who had executed a contract to purchase software and services from PeopleSoft only two days before, immediately wrote to PeopleSoft and requested that PeopleSoft suspend implementation of its contract until after the uncertainty injected by Oracle’s Tender Offer had been resolved, describing Ellison’s words as “very extreme” and Oracle’s actions

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as “compromis[ing] the future of PeopleSoft and its solutions.” Customer G received a copy of Oracle’s press release and put final negotiations on a transaction with PeopleSoft on hold. Customer H called off a planned presentation by PeopleSoft due to the “situation between PeopleSoft and Oracle.” Customer I advised PeopleSoft that, because Oracle had advised that it would be dangerous to purchase PeopleSoft products in light of Oracle’s Tender Offer, it would postpone its decision to buy until July 7 – the day Oracle’s Tender Offer was initially supposed to expire. [Additionally, an email from Max Hill, an Oracle sales executive, to Jeff Henley indicates that “the acquisition issue has helped our cause” in an attempt to lure a $2.5 million account from PeopleSoft.]

40. As Oracle intended, and as the result of the efforts of Oracle’s internal group charged with the responsibility of influencing and shaping their reports, including Jim Finn, Peggy O’Neill, Betty Cho, and Jennifer Glass, industry analysts advised against doing business with PeopleSoft until the fate of the company is clear. Gartner noted that PeopleSoft “will feel a short-term negative impact on revenue as customers delay purchase and upgrade decisions,” and advises its clients that “[i]f you’re considering a purchase of J.D. Edwards or PeopleSoft products, don’t sign a deal until it becomes clear whether Oracle’s plans to acquire PeopleSoft are serious.” Gartner went on to advise that “PeopleSoft customers will face significant long-term disruption as they feel pressure to migrate to Oracle applications and infrastructure or to find alternatives . . . . Those that recently decided to upgrade to v.8 should reconsider. . . .” Oracle adopted these claims as its own, and sent this report to PeopleSoft customers and prospective customers, with the intent to cause them to cancel or delay their purchase decisions. [Oracle’s internal group objected to the “tone” of some of the analyst reports, and actively encouraged them to advise customers to delay purchases of PeopleSoft customers. Peggy O’Neill even chastised an analyst for using the term “hostile takeover,” writing in one email “It is not hostile to try to go after your competitor’s customers.”]

41. Other industry analysts reporting on Oracle’s Tender Offer fueled the market perception that Oracle’s illegal efforts were having an adverse impact on customer relations. On June 7, 2003, Fred A. Hood, a J.D. Edwards customer, told the New York Times that: “If I were a PeopleSoft customer, I’d be a tad nervous.” Hood also stated that he understood the benefits of the merger of PeopleSoft and J.D. Edwards because it would expand the product line, but that Oracle’s

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acquisition of PeopleSoft would result in fewer products rather than more for customers. Silicon.com reports: “If you have [PeopleSoft] 8 or are in the middle of installing it, you’ve just lost another option. And you know that you’re going to face another migration soon – with less choice.” Said the Butler Group’s Mike Thompson, “Oracle is just wiping out the opposition. . . . [Oracle] has no plans to sell [PeopleSoft software] and no plans to integrate it. . . . If there’s good technology, they’ll pinch it. It’s just a wipe-out. . . . This just reduces end-user choice – and that is not a good thing.” It is in line with an “Oracle only” strategy, as described by Forrester Research: “Oracle’s vision requires using Oracle as the single application and database platform.”

42. Oracle’s illegal efforts have already had an effect on PeopleSoft customers’ purchasing decisions. On June 19, 2003, Customer J sent PeopleSoft a letter stating: “Effective immediately, all negotiations between [Customer J] and PeopleSoft, Inc., are suspended. Oracle’s recent attempt to takeover PeopleSoft, Inc., has created a great deal of uncertainty about the long term viability of PeopleSoft’s software products. In the event that the ‘takeover’ is successful, the future of the entire PeopleSoft software product line could be seriously impaired. We will renew negotiations with both parties when we have definitive information on the viability of PeopleSoft, Inc., software products to provide a long term solution for our needs.”

43. The results of this strategy have already been widely reported. For example, Los Angeles County suspended talks with PeopleSoft for a $100 million software project to handle county finances. The county stated that “[t]hings were progressing nicely, then out of the blue Mr. Ellison decides to take a shot at PeopleSoft,” and that “[w]e made a decision, given the uncertainty, that we suspend negotiations. Why spend dollars and resources negotiating if we don’t know what the outcome will be?”

F. The Unfair Practices – Including Oracle’s False, Misleading And Deceptive Statements – Were Designed to Interfere with PeopleSoft’s Merger Agreement with J.D. Edwards And Prevent PeopleSoft From Displacing Oracle As The Number Two Worldwide Enterprise Software Vendor

44. Oracle initially announced that it intended to complete the Tender Offer by July 2003 – two to three months before PeopleSoft otherwise might complete its purchase of J.D. Edwards. (Oracle has since extended its deadline several times.) The pending combination of PeopleSoft and

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J.D. Edwards was seen by Oracle as a competitive threat, and Oracle’s move was a desperate ploy to interfere with the merger agreement and prevent PeopleSoft from displacing Oracle as the second largest enterprise software vendor, trailing only Germany’s SAP. [As Betty Cho, an Oracle executive, wrote, an analyst’s charge that the Tender Offer “was an overly aggressive move on Oracle’s part to keep PSFT from overtaking Oracle as the number two apps vendor” was “difficult for me to argue because it is objectively true . . . .”] Moreover, a June 9, 2003, Wall Street Journal article quoted Oracle CEO Larry Ellison as admitting that Oracle’s Tender Offer was planned as a reaction to a possible PeopleSoft-J.D. Edwards transaction:

One contingency plan [developed by Oracle] covered the possibility of PeopleSoft’s buying J.D. Edwards & Co., a Denver company that Oracle had also evaluated as an acquisition candidate, Mr. Ellison says. When PeopleSoft last Monday announced an agreement to buy J.D. Edwards, for stock currently worth $2 billion . . . , Mr. Ellison set those plans in motion. “Now would be the time to launch on PSFT,” a reference to PeopleSoft’s stock symbol, Oracle Executive Vice President Safra Catz wrote Mr. Ellison in an e-mail within minutes of PeopleSoft’s announcement, Mr. Ellison says. His return e-mail: “Just what I was thinking.”

45. The article quotes internal Oracle emails planning the launch of a tender offer in the event that PeopleSoft announces a deal with J.D. Edwards. In Ellison’s colorful words, “We’ve got this war game in a box. This has all been pre-scripted.”

46. In a document Oracle filed with the SEC on June 6, 2003, Oracle stated: “Our Offer will be for the acquisition of PeopleSoft. Once we complete the acquisition of PeopleSoft, we will review whether, and on what terms, Oracle would support the J.D. Edwards transaction. . . . We believe that our cash offer to acquire PeopleSoft is superior to their current alternatives and also involves substantially less risk for PeopleSoft’s stockholders than the proposed transaction with J.D. Edwards.” These public statements were intended to cast a pall over J.D. Edwards and scare off potential customers from signing deals with J.D. Edwards.

47. AMR Research issued an “Alert” to its clients on June 6 in which it advised them: “Oracle CEO and Chairman Larry Ellison is hoping stockholders might be frightened into taking a less lucrative deal, characterizing PeopleSoft and J.D. Edwards as ‘very distressed’ . . . . This [offer] is clearly a reaction to the J.D. Edwards acquisition and is an effort to either kill the deal or wound PeopleSoft and hurt it competitively in the short to mid-term.” Gartner, Inc. agrees, telling its clients

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that “Oracle is attempting to disrupt PeopleSoft’s planned acquisition of J.D. Edwards,” and concluded that “[d]amage has already been done.”

48. The front page of the June 7, 2003, San Jose Mercury News stated that Oracle is trying to scuttle PeopleSoft’s deal with J.D. Edwards, because that deal “threatens Oracle’s hopes for a bigger toehold in business-operations software.” Joshua Greenbaum of Enterprise Applications Consulting opined that the Tender Offer is “as much a blocking maneuver [aimed at the J.D. Edwards deal] as it is a personal attempt not to lose influence and market share in the enterprise software market.”

49. Other commentators agree that Oracle also intends for its media campaign to cast doubt on the J.D. Edwards acquisition. According to JMP Securities analyst Patrick Walravens, the Tender Offer was a “clever move by Larry Ellison . . . . [I]f he doesn’t get it [the tender offer], he just created significant doubt in the buyers of software about the longevity of PeopleSoft and J.D. Edwards.” AMR Research agrees with this assessment, telling its clients that even if the Tender Offer “doesn’t work, Oracle will have disrupted PeopleSoft plans to buy J.D. Edwards and stolen much of the media and investor attention.”

50. Jim Shepherd, an analyst at AMR Research in Boston, put it this way: “Oracle wins either way . . . . Either they get PeopleSoft, or they’ve managed to mess up the PeopleSoft-J.D. Edwards deal, and steal their press and enthusiasm.” James Mendelson of SoundView Technology concurs: “If Oracle can buy PeopleSoft at a reasonable price, they substantially increase their market share and eliminate a competitor. If Oracle is unsuccessful, the bid in any event heightens the perception that PeopleSoft is in trouble and creates further confusion among customers/prospects in the wake of PeopleSoft’s pending deal for J.D. Edwards.” Larry Ellison’s public statements disparaging PeopleSoft, its products, and its ability to survive in the market exacerbate this effect. For example, on July 10, 2003, The Daily Deal reported that Ellison stated, he believes PeopleSoft “cannot compete in this business over the long term,” and that “[w]ith or without us I don’t believe PeopleSoft can survive.” Thus, even though Oracle was unsuccessful in forcing a breach of the merger agreement between PeopleSoft and J.D. Edwards, it nevertheless intended to and did cause severe damage to both PeopleSoft and J.D. Edwards.

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G. The Tender Offer And The Accompanying Illegal Practices Are Designed Only To Disrupt

51. The Board of Directors has recommended to PeopleSoft shareholders that Oracle’s Tender Offer, even as adjusted to $19.50, be rejected. Industry analysts have recognized that completing the Tender Offer makes little business sense for Oracle but its mere existence benefits Oracle by causing damage to PeopleSoft. Says analyst Rob Tholemeier of Ramberg, Whalen research: “It just doesn’t make sense for Oracle to do this deal right now. It just creates a huge mess . . . . If you wanted to raise hell, this is one way to do it.” Indeed, analysts agree that Oracle cannot be serious about acquiring PeopleSoft at the prices it has offered.

V. CLAIMS

FIRST CAUSE OF ACTION

(Violations Of Business & Professions Code § 17500 et seq. Against All Defendants)

52. Plaintiffs incorporate by reference paragraphs 1 through 51 above, and reasserts those allegations as if set forth in full herein.

53. Beginning at an exact date unknown to PeopleSoft but at least since June 6, 2003, Defendants have committed acts of untrue and misleading advertising, as defined by Business and Professions Code §17500 et seq., by knowingly engaging in acts and practices with intent to induce members of the public, including PeopleSoft’s current and prospective customers, to purchase software applications and/or other products from Oracle, and/or to refrain from purchasing such applications and/or other products from PeopleSoft and/or J.D. Edwards.

54. As detailed above, Defendants have, in advertisements as that term is defined by statute, issued falsehoods, deceptions, misstatements and/or have omitted relevant and important information about their statements, in newspaper ads, on Oracle’s website, in Oracle’s filings with the SEC and elsewhere. The advertisements mischaracterized: (a) PeopleSoft’s products, and the ease or difficulty with which Oracle contends they are upgradeable; (b) Oracle’s plans and capability to provide support to PeopleSoft’s customers; (c) the cost to PeopleSoft customers of its plan to migrate them to Oracle; and (d) falsely and misleadingly described the actions of PeopleSoft and its directors. In addition, Oracle has made explicit, false, misleading, incomplete and deceptive disparaging

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comparisons between its own products and services and PeopleSoft’s, which are designed to steal PeopleSoft’s customers, and are likely to deceive the public and those targeted customers.

55. These acts of untrue and misleading advertising by Defendants are likely to mislead, and present a continuing threat to, members of the public and PeopleSoft’s customers – the targets of the advertisements – in that such persons may be induced to terminate or delay software contracts and upgrades with PeopleSoft, breach contracts with PeopleSoft, enter into contracts with Oracle, or otherwise migrate to the Oracle platform, in reliance on disparaging, false, misleading, deceptive, and incomplete information.

56. PeopleSoft seeks injunctive relief and restitution against Defendants. Such relief is appropriate under these circumstances.

SECOND CAUSE OF ACTION

(Intentional Interference With Contractual Relations Against All Defendants)

57. Plaintiffs incorporate by reference paragraphs 1 through 56 above, and reasserts those allegations as if set forth in full herein.

58. PeopleSoft has contractual relationships with its existing enterprise software customers. On information and belief, Defendants were aware of the contractual relationships between PeopleSoft and its existing enterprise software customers.

59. On information and belief, Plaintiffs allege that Defendants have engaged in a concerted campaign to disrupt PeopleSoft’s existing customer relationships, and have tortiously and intentionally interfered with and have taken action designed to disrupt and induce breaches of, PeopleSoft’s contractual relationships with existing customers. Among other acts, Defendants have threatened to terminate PeopleSoft’s products, placing any customer’s decision to purchase or upgrade such products in serious jeopardy. Defendants have engaged in a concerted campaign to use the existence of its Tender Offer to coerce PeopleSoft’s customers into canceling or postponing orders for new and/or upgraded PeopleSoft products. At Defendants’ urging, industry analysts have recommended that PeopleSoft customers breach these contracts with PeopleSoft.

60. As a result of Defendants’ actions, PeopleSoft’s contractual relationships with its existing enterprise software customers have been actually disrupted.

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61. As a proximate result of Defendants’ conduct, PeopleSoft has been and will continue to be injured in its business because of Defendants’ past and continuing actions. PeopleSoft is thus entitled to injunctive relief and to recover damages for the injuries it has suffered.

THIRD CAUSE OF ACTION

(Trade Libel Against All Defendants)

62. Plaintiffs incorporate by reference paragraphs 1 through 61 above, and reasserts those allegations as if set forth in full herein.

63. As detailed herein, Defendants have publicly disparaged PeopleSoft’s products and services, and have issued falsehoods, deceptions, misstatements and/or have omitted relevant and important information about their statements, in newspaper ads, on Oracle’s website, in Oracle’s filings with the SEC and elsewhere; in addition, such statements have been republished in countless analyst reports and newspaper articles. The statements disparaged the quality of PeopleSoft’s products and services, the ease or difficulty with which Oracle contends they are upgradeable, and misrepresent the actions of PeopleSoft and its board. In addition, Oracle has made explicit, false, misleading, incomplete and deceptive disparaging comparisons between its own products and services and PeopleSoft’s, which are designed to steal PeopleSoft’s customers, and are likely to deceive the public and those targeted customers.

64. At the time such statements were published, Oracle was aware, or should have been aware, of the likelihood that such false and disparaging statements would cause pecuniary harm to PeopleSoft. Oracle’s statements, as published by Oracle’s executives and other Oracle employees as detailed herein, were false and misleading when made, and on information and belief, Oracle either knew such statements were false when made or acted in reckless disregard of the truth or falsity of those statements.

65. Defendants intended that the publication of these disparaging statements regarding PeopleSoft’s products and services would result in pecuniary harm to PeopleSoft and its business.

66. Defendants’ false and disparaging statements about PeopleSoft’s products and services have caused pecuniary harm to PeopleSoft, in an amount of damages to be proven at trial.

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FOURTH CAUSE OF ACTION

(Intentional Interference With Prospective Economic Advantage Against All Defendants)

67. Plaintiffs incorporate by reference paragraphs 1 through 66 above, and reasserts those allegations as if set forth in full herein.

68. PeopleSoft had an advantageous prospective economic relationship with both its current and prospective customers. On information and belief, Defendants were aware of these prospective economic relationships, and absent Defendants’ tortious interference, these economic relationships would have resulted in future economic benefit to PeopleSoft.

69. On information and belief, Plaintiffs allege that Defendants have engaged in a concerted campaign to disrupt PeopleSoft’s prospective economic advantage, and have tortiously and intentionally interfered with and have taken action to disrupt PeopleSoft’s prospective economic relationships with its current and prospective customers, for an improper purpose and by improper means. At least one prospective customer of PeopleSoft, who was scheduled to sign a contract with PeopleSoft for the purchase of its products on Monday, June 9, 2003, has notified the company that in light of the Tender Offer it intends to delay its decision to become a PeopleSoft customer until the fate of the company is clarified. Another current customer, who had been negotiating the license of additional products, has decided to heed the advice from Oracle that in light of Oracle’s intention to terminate PeopleSoft’s product plans, it is too dangerous to proceed, at least not until Oracle’s tender offer is resolved. Defendants have threatened to terminate PeopleSoft’s products, placing any customer’s decision to purchase or upgrade such products in serious jeopardy. Defendants have engaged in a concerted campaign to use its Tender Offer to coerce PeopleSoft’s prospective customers into delaying orders for new and/or upgraded PeopleSoft products.

70. As a result of Defendants’ actions, PeopleSoft’s relationships with its current and prospective customers have been actually disrupted. Aside from the fact of interference itself, Defendants’ conduct was independently wrongful in that it constituted: (a) deceptive advertising as described herein; (b) trade libel and product disparagement as described herein; (c) fraud and deceit as described herein; (d) a concerted campaign to damage PeopleSoft’s current and future business as described herein; (e) intentional interference with PeopleSoft’s current customers’ contracts as

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described herein; and (f) violation of California Business & Professions Code §17200 as described herein.

71. As a proximate result of Defendants’ conduct, PeopleSoft has been and will continue to be injured in its business because of Defendants’ past and anticipated actions. PeopleSoft is thus entitled to injunctive relief and to recover damages for the injuries it has suffered.

FIFTH CAUSE OF ACTION

(Negligent Interference With Prospective Economic Advantage Against All Defendants)

72. Plaintiffs incorporate by reference paragraphs 1 through 71 above, and reasserts those allegations as if set forth in full here.

73. PeopleSoft had an advantageous prospective economic relationship with both its current and prospective customers. On information and belief, Defendants were aware of these prospective economic relationships, and absent Defendants’ tortious interference, these economic relationships likely would have resulted in future economic benefit to PeopleSoft.

74. On information and belief, Plaintiffs allege that Defendants have engaged in a concerted campaign to disrupt PeopleSoft’s prospective economic advantage, and have tortiously and recklessly interfered with and have taken action to disrupt PeopleSoft’s prospective economic relationships with its current and prospective customers, for an improper purpose and by improper means. Defendants have threatened to terminate PeopleSoft’s products, placing customers’ decisions to purchase or upgrade such products in serious jeopardy. Defendants have engaged in a concerted campaign to use its Tender Offer to coerce PeopleSoft’s prospective customers into delaying orders for new and/or upgraded PeopleSoft products.

75. It was reasonably foreseeable that Defendants’ wrongful conduct would interfere with or disrupt PeopleSoft’s economic relationships if Defendants failed to exercise due care in communicating with PeopleSoft’s current and prospective customers. As described herein, Defendants’ wrongful, reckless and negligent conduct was a failure to exercise such due care.

76. PeopleSoft’s economic relationships have actually been disrupted by Defendants’ wrongful conduct and PeopleSoft has been damaged by this conduct. At least one prospective customer of PeopleSoft, who was scheduled to sign a contract with PeopleSoft for the purchase of its

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products on Monday, June 9, 2003, has notified the company that in light of the Tender Offer it intends to delay its decision to become a PeopleSoft customer until the fate of the company is clarified. Another current customer, who had been negotiating the license of additional products, has decided to heed the advice from Oracle that in light of Oracle’s intention terminate PeopleSoft’s product plans, it is too dangerous to proceed, at least not until Oracle’s Tender Offer is resolved.

SIXTH CAUSE OF ACTION

(Violations Of Business & Professions Code §§17200 et seq. Against All Defendants)

77. Plaintiffs incorporate by reference paragraphs 1 through 76 above, and reasserts those allegations as if set forth in full here.

78. Plaintiffs are suing both in their individual capacities and on behalf of the public and seek relief against Defendants Oracle and Pepper for unfair competition and business practices pursuant to California Business & Professions Code §§17200 et seq.

79. On information and belief, Oracle’s intent in announcing this Tender Offer was to interfere with PeopleSoft’s existing contracts and with its prospective economic advantage.

80. On information and belief, Oracle’s motives were at least twofold:

a. Oracle was fully aware of the agreement and prospective economic relationship between PeopleSoft and J.D. Edwards at the time Oracle announced its Tender Offer. On information and belief, Oracle announced the tender offer with the intent of introducing uncertainty into the deal struck between PeopleSoft and J.D. Edwards and in an attempt to sabotage that transaction, and preventing PeopleSoft from becoming an even stronger competitor. Oracle hoped that this uncertainty would result in the cancellation of the existing agreement between PeopleSoft and J.D. Edwards and the disruption of the prospective economic relationship between those two companies, and in any event, that this uncertainty would damage both PeopleSoft and J.D. Edwards.

b. Oracle was fully aware of the fact that PeopleSoft has both existing and prospective enterprise software customers, and that PeopleSoft enters into a contractual relationship with each customer purchasing a PeopleSoft product. On information and belief, Oracle announced the tender offer with the intent of introducing uncertainty in the minds of PeopleSoft’s current and prospective customers regarding the continued viability and existence of PeopleSoft products. Oracle

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hopes that the introduction of this uncertainty will result in a diminution of PeopleSoft’s existing and prospective customer bases.

81. These acts and practices have been and will continue to be injurious to PeopleSoft and its customers, and consequently constitute unfair business acts or practices within the meaning of §17200.

82. Additionally, Oracle’s conduct, as described above, constitutes a violation of California Civil Code Sections 1709 and 1710, prohibiting fraud and deceit, and thus constitutes unlawful acts or practices within the meaning of and proscribed by §17200. Among these acts are Oracle’s public statements that: (a) PeopleSoft’s proposed acquisition of J.D. Edwards is “a very risky merger”; (b) the migration of PeopleSoft’s customers from its version 7 to version 8 is “a major, major effort”; and (c) the migration of PeopleSoft customers to Oracle software will be “easy”; are false, misleading, deceptive, and/or omit important information, and were made willfully, with the intent to induce PeopleSoft’s shareholders to alter their position to their own detriment, injury and risk. Oracle’s statements are false and, on information and belief, Oracle did not believe such statements to be true and/or knew there was no reasonable ground for believing them to be true at the time such statements were made.

83. The true facts, as reported by Computerworld and numerous other industry publications, are that Oracle has a poor track record in managing its own product upgrades, Oracle has received frequent complaints from its own customers “about the quality of the company’s application updates and its technical support,” and any migration to the Oracle platform would be extremely difficult and expensive. Ellison admitted that Oracle bungled the transition to its own 11i suite applications product just last year, admitting to the Wall Street Journal that it is a complex product and that Oracle failed to discover all the bugs while testing it. Said Ellison, “Mea culpa. It’s true.” As a result, Oracle and Ellison were sued by their own stockholders for misleading investors concerning the difficulties associated with Oracle’s own product upgrades, and the Delaware Chancery Court recently denied a motion to dismiss derivative claims against Oracle’s CEO and others citing possible credibility issues with testimony of the CEO and other Oracle Board members. Moreover, Oracle also failed to disclose the “tragic” CPG integration project from just a few years

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ago, while it misleadingly trumpeted its allegedly strong track record of successful integration projects. For the substantial numbers of PeopleSoft customers who use PeopleSoft applications with non-Oracle databases, migration to Oracle applications would be particularly difficult and enormously expensive. As analyst Forrester Research states, the “Oracle migration process . . . could be nightmarish.”

84. The unfair, unlawful and fraudulent business practices, as described above, present a continuing threat to PeopleSoft and members of the general public, and will harm competition. These acts and practices, as described in the preceding paragraphs, violate California’s Business & Professions Code § 17200, because the harm to PeopleSoft and California’s consumers outweighs the utility of Oracle’s practices and, consequently constitute unfair business acts or practices within the meaning of § 17200.

VI. PRAYER FOR RELIEF

Plaintiffs pray as follows:

1. For injunctive relief, as necessary to prevent continuing harm to Plaintiffs, enjoining Oracle and its officers, directors, agents, servants and assigns, and all those acting in concert with them from:

a. Proceeding with the Tender Offer in continued violation of applicable state law;

b. Making any written, oral or electronic communication with any person or entity known or believed to be an existing PeopleSoft customer, with respect to any aspect of: (1) the proposed Tender Offer for PeopleSoft shares by Oracle; (2) the impact of the Tender Offer on PeopleSoft or its customers or products; (3) the plans, if any, for Oracle to support any PeopleSoft products or platforms if the Tender Offer is successful; (4) the plans, if any, for Oracle to migrate PeopleSoft customers to any Oracle products or platforms if the Tender Offer is successful; (5) PeopleSoft’s ability to continue as a stand-alone company in the absence of a successful Tender Offer; or (6) PeopleSoft’s current business and/or financial condition;

c. Transmitting documents or information summarizing the proposed Tender Offer, or any of its terms, to any existing PeopleSoft customers, including any summaries of the tender offer, “frequently asked questions” or the like;

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d. Referring existing PeopleSoft customers to information about the proposed Tender Offer, or any of its terms, that are posted on any Oracle or third-party website;

e. Soliciting existing PeopleSoft customers to terminate or alter their business relationship with PeopleSoft in light of the proposed Tender Offer;

f. Offering any promise of technical or product support or other economic inducements to existing PeopleSoft customers to modify their contractual or business relationships with PeopleSoft;

g. Otherwise interfering with existing PeopleSoft customer relationships.

h. Misrepresenting the actions of PeopleSoft and its directors.

2. Requiring that Defendants publish statements correcting their prior false statements about their intentions and about the actions of PeopleSoft and its directors;

3. For damages, including lost profits and other incidental and consequential damages according to proof at trial;

4. For punitive damages according to proof at trial;

5. For costs, expenses, and reasonable attorneys’ fees;

6. For prejudgment interest; and

7. For such other and further relief as the Court deems just and proper.

DATED: August 12, 2003

GIBSON, DUNN & CRUTCHER LLP
By:	/s/ Jonathan C. Dickey
	Jonathan C. Dickey
Attorneys for Plaintiffs PEOPLESOFT, INC. and J.D. EDWARDS & COMPANY

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FIRST AMENDED COMPLAINT CASE NO. RG03101434

EX-99.(A)(5)(LXIX)

Exhibit (a)(5)(lxix)

BINGHAM McCUTCHEN LLP

DAVID M. BALABANIAN (SBN 37368)

STEPHEN D. HIBBARD (SBN 177865)

GEOFFREY M. HOWARD (SBN 157468)

Three Embarcadero Center

San Francisco, California 94111-4067

Telephone: 415.393.2000

Facsimile: 415.393.2286

DAVIS POLK & WARDWELL

WILLIAM M. KELLY (SBN 108011)

ZACHARY S. MCGEE (SBN 224790)

1600 El Camino Real

Menlo Park, CA 94025

Telephone: 650.752.2000

Facsimile: 650.752.2111

DORIAN DALEY (SBN 129049)

ORACLE CORPORATION

500 Oracle Parkway, M/S 5op7

Redwood Shores, CA 94070

Telephone: 650.506.5200

Facsimile: 650.506.7114

Attorneys for Defendants Oracle Corporation and

Pepper Acquisition Corporation

SUPERIOR COURT OF THE STATE OF CALIFORNIA

COUNTY OF ALAMEDA

PEOPLESOFT, INC., a Delaware corporation, and J.D. EDWARDS & COMPANY, a Delaware corporation,	No. RG03101434
Plaintiffs, v.	DEFENDANTS’ NOTICE OF DEMURRER AND DEMURRER TO PLAINTIFFS’ FIRST AMENDED COMPLAINT
ORACLE CORPORATION, a Delaware corporation, PEPPER ACQUISITION CORP., a Delaware corporation, and DOES 1-100,	Date:	October 23, 2003
	Time:	2:00 p.m.
	Dept:	22
	Judge:	Hon. Ronald M. Sabraw
Defendants.

NOTICE OF DEMURRER AND DEMURRER

TO FIRST AMENDED COMPLAINT

NOTICE OF DEMURRER

TO ALL PARTIES AND THEIR ATTORNEYS OF RECORD:

PLEASE TAKE NOTICE THAT on October 23, 2003, at 2:00 p.m., or as soon thereafter as the matter may be heard, in Department 22 of the above entitled Court, located at 1221 Oak Street, Oakland, California, defendants Oracle Corporation and Pepper Acquisition Corporation (together, “Oracle”) will and hereby do demur to PeopleSoft, Inc.’s and J.D. Edwards & Company’s (hereafter, “PeopleSoft”) First Amended Complaint.

This motion is based upon this Notice of Demurrer and Demurrer, the attached Memorandum of Points and Authorities, the accompanying Request for Judicial Notice, the accompanying Appendix of Non-California Authorities, all pleadings on file in this action, such matters of which the Court may take judicial notice, and any argument made or evidence introduced at the hearing on this demurrer.

GENERAL DEMURRER

The First Amended Complaint against Oracle fails to state facts sufficient to constitute a cause of action. Code Civ. Proc. § 430.10(e).

DEMURRER TO THE FIRST CAUSE OF ACTION

1. The first cause of action for violations of Business & Professions Code § 17500 fails to state facts sufficient to constitute a cause of action against Oracle because PeopleSoft fails to allege that any consumers are mislead by Oracle’s promises to provide support to PeopleSoft’s customers; on the contrary, PeopleSoft alleges that Oracle has already disclosed its “secret” intent to migrate PeopleSoft’s customers to Oracle’s products. Code Civ. Proc. § 430.10(e).

2. The first cause of action for violations of Business & Professions Code § 17500 fails to state facts sufficient to constitute a cause of action against Oracle because statements about Oracle’s or PeopleSoft’s products are unactionable opinion. Code Civ. Proc.

2

NOTICE OF DEMURRER AND DEMURRER

TO FIRST AMENDED COMPLAINT

§ 430.10(e).

3. The first cause of action for violations of Business & Professions Code § 17500 fails to state facts sufficient to constitute a cause of action against Oracle because statements about Oracle’s tender offer are legal corporate actions under the Williams Act and are not made with the intent to dispose of property. Code Civ. Proc. § 430.10(e).

DEMURRER TO THE SECOND CAUSE OF ACTION

4. The second cause of action for intentional interference with contractual relations fails to state facts sufficient to constitute a cause of action against Oracle because PeopleSoft has failed to allege facts sufficient to show that Oracle knew of any contract between PeopleSoft and “Customer F,” that Oracle intentionally took any action to induce breach of that contract, or whether there was in fact a breach of the contract at all. Code Civ. Proc. § 430.10(e).

DEMURRER TO THE THIRD CAUSE OF ACTION

5. The third cause of action for trade libel fails to state facts sufficient to constitute a cause of action against Oracle because statements about Oracle’s or PeopleSoft’s products are unactionable opinion. Code Civ. Proc. § 430.10(e).

6. The third cause of action for trade libel fails to state facts sufficient to constitute a cause of action against Oracle because Oracle’s statements are privileged free speech. Code Civ. Proc. § 430.10(e).

DEMURRER TO THE FOURTH CAUSE OF ACTION

7. The fourth cause of action for intentional interference with prospective economic advantage fails to state facts sufficient to constitute a cause of action against Oracle because Oracle’s actions are protected by the competition privilege, and Oracle did not engage in any wrongful conduct apart from the interference itself. Code Civ. Proc. § 430.10(e).

DEMURRER TO THE FIFTH CAUSE OF ACTION

8. The fifth cause of action for negligent interference with prospective economic advantage fails to state facts sufficient to constitute a cause of action against Oracle

3

NOTICE OF DEMURRER AND DEMURRER

TO FIRST AMENDED COMPLAINT

because Oracle owes no duty of care to its competitor PeopleSoft, nor has PeopleSoft adequately alleged such a duty. Code Civ. Proc. § 430.10(e).

DEMURRER TO THE SIXTH CAUSE OF ACTION

9. The sixth cause of action for violations of Business & Professions Code § 17500 fails to state facts sufficient to constitute a cause of action against Oracle because PeopleSoft fails to allege that Oracle committed any underling unlawful, unfair or fraudulent act. Code Civ. Proc. § 430.10(e).

10. The sixth cause of action for violations of Business & Professions Code § 17500 fails to state facts sufficient to constitute a cause of action against Oracle because Oracle’s tender offer is a practice permitted by law. Code Civ. Proc. § 430.10(e).

WHEREFORE, Oracle prays that this demurrer be granted without leave to amend, that PeopleSoft take nothing by their First Amended Complaint and that Oracle be awarded judgment for its costs and all other proper relief.

DATED:  September 11, 2003	Respectfully submitted,
	BINGHAM McCUTCHEN LLP
	By:	/s/ David M. Balabanian
		David M. Balabanian Attorneys for Defendants

4

NOTICE OF DEMURRER AND DEMURRER

TO FIRST AMENDED COMPLAINT

ENDORSED

FILED

ALAMEDA COUNTY

SEP 11 2003

CLERK OF THE SUPERIOR COURT

By CHERYL WATKINS

BINGHAM McCUTCHEN LLP

DAVID M. BALABANIAN (SBN 37368)

STEPHEN D. HIBBARD (SBN 177865)

GEOFFREY M. HOWARD (SBN 157468)

Three Embarcadero Center

San Francisco, California 94111-4067

Telephone: 415.393.2000

Facsimile: 415.393.2286

DAVIS POLK & WARDWELL

WILLIAM M. KELLY (SBN 108011)

ZACHARY S. MCGEE (SBN 224790)

1600 EI Camino Real

Menlo Park, CA 94025

Telephone: 650.752.2000

Facsimile: 650.752.2111

DORIAN DALEY (SBN 129049)

ORACLE CORPORATION

500 Oracle Parkway, M/S 5op7

Redwood Shores, CA 94070

Telephone: 650.506.5200

Facsimile: 650.506.7114

Attorneys for Defendants Oracle Corporation and Pepper Acquisition Corporation

SUPERIOR COURT OF THE STATE OF CALIFORNIA

COUNTY OF ALAMEDA

PEOPLESOFT, INC., a Delaware corporation, and J.D. EDWARDS & COMPANY, a Delaware corporation,	No. RG03101434
Plaintiffs, v.	MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF DEFENDANTS’ DEMURRER TO PLAINTIFFS’ FIRST AMENDED COMPLAINT
ORACLE CORPORATION, a Delaware corporation, PEPPER ACQUISITION CORP., a Delaware corporation, and DOES 1-100,	Date:	October 23, 2003
	Time:	2:00 p.m.
	Dept:	22
	Judge:	Hon. Ronald M. Sabraw
Defendants.

MEMORANDUM OF POINTS AND AUTHORITIES

IN SUPPORT OF DEMURRER TO FIRST AMENDED COMPLAINT

TABLE OF CONTENTS

			Page
I.	BACKGROUND		1
II.	ARGUMENT		4
	A.	The FAC States No Claim For “False Advertising”	5
	B.	The FAC States No Claim For Trade Libel	7
	C.	The FAC States No Claim For Inducing Breach Of Contract	8
	D.	The FAC States No Claim For Intentional Interference With Prospective Economic Advantage	9
	E.	The FAC States No Claim For Negligent Interference With Prospective Economic Advantage	11
	F.	The FAC States No Claim Under Business And Professions Code Section 17200	12
III.	CONCLUSION		13

i

MEMORANDUM OF POINTS AND AUTHORITIES

IN SUPPORT OF DEMURRER TO FIRST AMENDED COMPLAINT

TABLE OF AUTHORITIES

	Page
Cases
Accuimage Diagnostics Corp. v. TeraRecon, Inc., 260 F. Supp. 2d 941 (N.D. Cal. 2003)	8,9,11
Bed, Bath & Beyond of La Jolla, Inc. v. La Jolla Village Square Venture Partners, 52 Cal. App. 4th 867 (1997)	9,10
Churchill Village, L.L.C. v. General Elec. Co., 169 F. Supp. 2d 1119 (N.D. Cal. 2000)	12
Coastal Abstract Service, Inc. v. First Am. Title Ins. Co., 173 F.3d 725 (9th Cir. 1999)	6
Della Penna v. Toyota Motor Sales, U.S.A. Inc., 11 Cal. 4th 376 (1995)	9
DuPont Merck Pharmaceutical Co. v. Superior Court, 78 Cal. App. 4th 562 (2000)	8
Erlich v. Etner, 224 Cal. App. 2d 69 (1964)	7
Global Telemedia Int’l, Inc. v. Doe 1, 132 F. Supp. 2d 1261 (C.D. Cal. 2001)	8
Haskell v. Time, Inc., 857 F. Supp. 1392 (E.D. Cal. 1994)	6
Jackson v. County of Los Angeles, 60 Cal App. 4th 171 (1997)	7
Kamerman v. Steinberg, 891 F.2d 424 (2d Cir. 1989)	6,12
Khoury v. Maly’s of Cal, Inc., 14 Cal. App. 4th 612 (1993)	12
Korea Supply Co. v. Lockheed Martin Corp., 29 Cal. 4th 1134 (2003)	10
Lafayette Morehouse, Inc. v. Chronicle Publishing Co., 37 Cal. App. 4th 855 (1995)	8
Lange v. TIG Ins. Co., 68 Cal. App. 4th 1179 (1999)	11
LiMandri v. Judkins, 52 Cal. App. 4th 326 (1997)	11
Pinnacle Systems, Inc. v. XOS Technologies, Inc., 2003 WL 21397845 (N.D. Cal. May 19, 2003)	6
Polygram Records, Inc. v. Superior Court, 170 Cal. App. 3d 543 (1985)	7
Quelimane Co. v. Stewart Title Guaranty Co., 19 Cal. 4th 26 (1998)	8

ii

MEMORANDUM OF POINTS AND AUTHORITIES

IN SUPPORT OF DEMURRER TO FIRST AMENDED COMPLAINT

TABLE OF AUTHORITIES

(continued)

	Page
San Francisco Design Center Assocs. v. Portman Cos., 41 Cal. App. 4th 29 (1995)	5
Savage v. Pacific Gas & Elec. Co., 21 Cal. App. 4th 434 (1993)	7
Schreiber v. Burlington Northern, Inc., 472 U.S. 1 (1985)	13
Small v. Fritz Companies, Inc., 30 Cal. 4th 167 (2003)	11
Stolz v. Wong Communications Ltd. Partnership, 25 Cal. App. 4th 1811 (1994)	11
Statutes
Securities & Exchange Act of 1934, 15 U.S.C. § 78aa	12
Williams Act, 15 U.S.C. § 78n	1, 6, 12
Business & Professions Code § 17200	12
Business & Professions Code § 17500	5, 6, 7
Cal. Civ. Code § 47	8
Other Authorities
6 Cal. Jur. 3d Assault & Other Willful Torts § 167 (1988)	7

iii

MEMORANDUM OF POINTS AND AUTHORITIES

IN SUPPORT OF DEMURRER TO FIRST AMENDED COMPLAINT

Defendants Oracle Corporation and Pepper Acquisition Corporation (together, “Oracle”) submit this Memorandum of Points and Authorities in support of their Demurrer to the First Amended Complaint (“FAC”) of plaintiffs PeopleSoft, Inc. and J.D. Edwards & Company (collectively “PeopleSoft”).

I. BACKGROUND

PeopleSoft and Oracle are competitors in the market for enterprise applications software. FAC ¶ 17. On June 2, 2003, PeopleSoft publicly proposed to merge with J.D. Edwards & Company, another company in the same industry. Id. ¶¶ 9, 10, 17. Four days later, Oracle announced a tender offer for all of PeopleSoft’s stock. Id. ¶ 18. The offering price was $16, representing a premium over the price at which that stock had been trading. Id. On June 9, 2003, Oracle formally commenced the tender offer by filing the required documents and disclosures with the Securities and Exchange Commission. Id.

PeopleSoft then brought this action seeking to prevent Oracle from proceeding with the tender offer. Its original complaint (“Complaint”) claimed that the tender offer was bogus, relying principally on the size of the offered premium and allegations that the tender offer was designed to “delay” and “derail” PeopleSoft’s proposed merger with J.D. Edwards. Complaint ¶¶ 6, 21.

In light of PeopleSoft’s allegations that the tender offer included “false, misleading and deceptive statements and omissions” (Complaint ¶ 25), Oracle removed the action to federal court, which has jurisdiction over claims of false, misleading or deceptive statements or omissions made “in connection with any tender offer.” Williams Act, 15 U.S.C. § 78n(d)-(e).

PeopleSoft responded that, whatever the Complaint appeared to say, it was not alleging that Oracle had made any false or misleading statements or omissions in connection with the tender offer. See PeopleSoft’s Ex Parte Motion to Remand, at 6:25-7:1, attached as Exhibit 1 to the Request for Judicial Notice (“RJN”).

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MEMORANDUM OF POINTS AND AUTHORITIES

IN SUPPORT OF DEMURRER TO FIRST AMENDED COMPLAINT

J.D. Edwards, now part of PeopleSoft, made the same representation, assuring Judge Armstrong that it “does not challenge the accuracy of [Oracle’s] statements and disclosures concerning the Tender Offer . . . .” J.D. Edwards’ Ex Parte Motion to Remand at 8:14-15, attached as RJN Ex. 2.¹

Based on these representations, Judge Armstrong remanded the action to this Court. Order Remanding Actions, attached as RJN Ex. 3.

Two things then happened which largely mooted PeopleSoft’s original claims. On June 18, 2003, Oracle increased its bid to $19.50 per share – a 22% increase over the original offer and a 30% premium over the price at which the shares were trading before the tender offer.² FAC ¶¶ 18,31. And, PeopleSoft consummated its merger with J.D. Edwards – the transaction which, both PeopleSoft and J.D. Edwards had claimed, Oracle’s tender offer was designed to thwart.³

Elimination of the two principal grounds for PeopleSoft’s challenge to the tender offer did not, however, deter it from proceeding with this action.

Indeed, PeopleSoft renews its claim that the tender offer is inadequate and misleading, despite the substantial increase in the offering price and the fact that, even before the increase, PeopleSoft had assured the federal court that it was not challenging the accuracy of any statement made in connection with it.

¹ It also told the federal court that it “does not allege that Oracle’s disclosures in its tender offer documents were materially false or misleading. Rather, [it] alleges that the Tender Offer for PeopleSoft has as its principal goal thwarting the merger between J.D. Edwards and PeopleSoft in order to harm both companies.” RJN Ex. 2 at 7:9-12 (emphasis supplied).

² PeopleSoft’s Board of Directors rejected the increased offer without even submitting it to its shareholders. FAC ¶ 51.

³ To make sure its shareholders could not reject the J.D. Edwards merger, PeopleSoft’s management removed the requirement for shareholder approval. PeopleSoft’s Amendment No. 2 to its Schedule 14D-9 Solicitation/Recommendation Statement, filed with the SEC June 16, 2003, attached as RJN Ex. 4.

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The thrust of the FAC is that Oracle’s promise to provide PeopleSoft customers with a “‘graceful’ migration to Oracle’s applications,” if the tender offer succeeds, must be false because “those knowledgeable about Oracle and PeopleSoft products know that an Oracle acquisition of PeopleSoft would impose on existing PeopleSoft customers significant new migration, software modification and re-implementation costs, increased resource demands and substantial disruption to their businesses.” FAC ¶¶ 4,5.

In short, PeopleSoft claims that the practical obstacles to migrating its customers to Oracle’s system are so substantial that Oracle must be lying when it promises to do it, and this Court should, therefore, prohibit Oracle from making such promises and enjoin the tender offer.

Despite its great length, the FAC has one notable omission – a cause of action. See infra Section II. Nonspecific reports from its customers and musings by industry savants cannot substitute for allegations that Oracle did anything wrong. The normal competitive incidents to a contested tender offer, including any resulting uncertainty on the part of customers, shareholders or employees, do not give rise to viable claims under California law. Oracle has every right to pursue its tender offer and to compete actively with PeopleSoft for customers.

The FAC also contradicts PeopleSoft’s representations to the federal court, and displays serious internal inconsistencies:

• To obtain remand, PeopleSoft told Judge Armstrong it was not challenging the accuracy of any statement Oracle made in connection with the tender offer. Now, back in this Court, it does just that. See, e.g. FAC ¶¶ 24, 32 (k).

• PeopleSoft claims Oracle has failed to disclose material facts about the tender offer. FAC ¶¶ 24, 32(k). But, to prove the existence of those facts it points to statements in the tender materials themselves. For example, it alleges Oracle “studiously failed to disclose . . . that there are potentially insurmountable barriers to consummating the Tender Offer.” FAC ¶ 24.

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In the very next sentence, however, it locates them “buried in the documents filed with the SEC which describe the Tender Offer.” Id.

• PeopleSoft says Oracle is falsely promising PeopleSoft customers that, if the tender offer succeeds, it will continue to support PeopleSoft software. FAC ¶¶ 4, 28, 32(b), 32(j), 32(k), 32(l). But the effect of such promises – whether true or false – must necessarily be to encourage the recipients to stay with PeopleSoft.

• PeopleSoft says Oracle must be stopped from falsely assuring PeopleSoft customers that it will support PeopleSoft software when its true intent is to force PeopleSoft’s customers to use Oracle software. But it told Judge Armstrong there was no need to “unmask” Oracle’s plan to force PeopleSoft customers to change to Oracle software because “Oracle has already disclosed that.”⁴ See infra at 5.

• Though PeopleSoft expresses concern for its shareholders (FAC ¶¶ 3, 24, 29, 33(a), 33(b), 51), the relief it seeks here – and in Delaware Chancery Court – is to deny PeopleSoft’s shareholders any opportunity to decide for themselves whether they wish to accept the tender offer or remain as shareholders of the merged PeopleSoft-J.D. Edwards enterprise.⁵

II. ARGUMENT

The FAC purports to state claims for false advertising, trade libel, inducing breach

⁴ Of course, this is only PeopleSoft’s allegation.

⁵ In Delaware Chancery Court, PeopleSoft vigorously resists its shareholders’ request for a chance to consider the tender offer free of the obstacles PeopleSoft has erected to such consideration. Complaint, Oracle Corp. v. PeopleSoft, Inc., No. 20377-NC (Del. Ch. filed June 18, 2003), attached as RJN Ex. 5.

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of contract, intentional and negligent interference with prospective economic advantage and unfair competition. In no instance does it succeed.

A. The FAC States No Claim For “False Advertising.”

PeopleSoft claims Oracle violated Business and Professions Code Section 17500 by publicly promising to support PeopleSoft software if the tender offer succeeds. Such statements are false, PeopleSoft alleges, because Oracle cannot possibly mean them and couldn’t honor them if it did.⁶ FAC ¶ 4.

This claim is doubly curious.

First, PeopleSoft specifically told the federal court that it “is not seeking to unmask Oracle’s secret undisclosed intent to run PeopleSoft into the ground and force its customers to select Oracle’s own products – Oracle has already disclosed that.” RJN Ex. 1 at 6:26-27 (emphasis supplied). If Oracle has “already disclosed” its intention to “force PeopleSoft’s customers to select Oracle’s products,” then it is hard to see how they could be misled by any contrary promise Oracle might now make.

Second, the necessary effect of an Oracle promise to support PeopleSoft software if the tender offer succeeds – even if false or incapable of performance – would necessarily be to encourage the recipient to stay with PeopleSoft, not leave it.

It is impossible to see how the allegedly “false advertising” could hurt PeopleSoft. Indeed, the obvious purpose and effect of the challenged promises is to preserve intact the customer base of a company for which Oracle is proposing to pay billions of dollars.

There are other infirmities in the “false advertising” claim.

Statements by Oracle about the superiority of its products and management or the

⁶ Opinions or predictions about contingent future events cannot support a claim for false advertising. “It is hornbook law that an actionable misrepresentation must be made about past or existing facts; statements regarding future events are merely deemed opinions.” San Francisco Design Center Assocs. v. Portman Cos., 41 Cal. App. 4th 29, 43-44 (1995).

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weakness of PeopleSoft’s (e.g. FAC ¶¶ 19, 22, 47, 50, 82, 32(o)) are the kind of competitive advocacy with which courts do not interfere. Coastal Abstract Service, Inc. v. First Am. Title Ins. Co., 173 F.3d 725, 731 (9th Cir. 1999) (statement that competitor was “too small” to handle business is “the kind of ‘puffery’ that does not qualify as a statement of fact capable of being proved false”); Pinnacle Systems, Inc., v. XOS Technologies, Inc., 2003 WL 21397845, *5-6 (N.D. Cal. May 19, 2003) (plaintiff failed to state a claim under Section 17500 where competitor defendant advertised that plaintiff’s products were inferior to defendant’s and that plaintiff’s product lacked certain characteristics and capabilities which it in fact had, because such commercial advocacy “cannot form the basis of the [Section 17500] claim”); Haskell v. Time, Inc., 857 F. Supp. 1392, 1399-1400 (E.D. Cal. 1994) (granting motion to dismiss Section 17200 and Section 17500 claims).

The statements PeopleSoft attributes to Oracle, its direct competitor – that PeopleSoft’s “best of breed [software product] is dead, except for dog shows,” (FAC ¶ 19), that “with or without us, PeopleSoft cannot survive” (FAC ¶¶ 22, 50), and that Oracle’s “application business was thriving in comparison to PeopleSoft’s” (FAC ¶ 32(o)) – are all of this type.

Nor could PeopleSoft’s attacks upon statements in Oracle’s tender offer (FAC ¶¶ 24, 32 (k)) qualify as “false advertising” under Business & Professions Code § 17500.

First, “[t]ender offers are legal corporate actions.” Kamerman v. Steinberg, 891 F.2d 424, 431-32 (2d Cir. 1989). Challenges to the accuracy of statements made “in connection with any tender offer” are properly made in federal court under the Williams Act. 15 U.S.C. § 78n(e).

Second, PeopleSoft told the federal court, as the basis for its successful remand motion, that it was not challenging the accuracy of any statement made by Oracle in or concerning its tender offer. See supra at 5. PeopleSoft is judicially estopped from taking a

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contrary position now.⁷

Third, statements about the tender offer and Oracle’s intentions with respect to it are not statements made “with intent . . . to dispose of real or personal property,” the only type of statements governed by § 17500. Cal. Bus. & Prof. Code § 17500. Oracle is not attempting to “dispose of any real or personal property” but, rather, to acquire PeopleSoft through a federally regulated tender offer made pursuant to a regulatory regime which PeopleSoft is asking this Court to supplant.

B. The FAC States No Claim For Trade Libel.

Trade libel is “an intentional disparagement of the quality of property, which results in pecuniary damage . . . .” Erlich v. Etner, 224 Cal. App. 2d 69, 73 (1964). A cause of action for trade libel thus requires: (1) a publication about the quality of the plaintiff’s product or service;⁸ (2) which induces others not to deal with the plaintiff; and (3) special damages. Id. Trade libel, however, “is not true libel and is not actionable as defamation.” Polygram Records, Inc. v. Superior Court, 170 Cal. App. 3d 543, 548-49 (1985). It is more akin to unfair competition because the allegedly injurious falsehoods interfere with business. 6 Cal. Jur. 3d Assault & Other Willful Torts § 167 (1988).

PeopleSoft’s trade libel claim fails for the same reasons that its false advertising claims fail – the allegedly “libelous” statements are just the sort of commercial advocacy with which courts do not interfere. Savage v. Pacific Gas & Elec. Co., 21 Cal. App. 4th 434, 444-45 (1993).

⁷ Judicial estoppel prohibits a party from “‘first [advocating] one position, and later, if it becomes beneficial, to assert the opposite.’” Jackson v. County of Los Angeles, 60 Cal App. 4th 171, 181-83 (1997) (citation omitted).

⁸ Oracle’s alleged statements about the “actions of PeopleSoft and its board” (FAC ¶¶ 33(a)-(d), 63) do not concern its property and services, and therefore cannot support a claim for trade libel.

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The trade libel claim fails for the additional reason that the allegedly libelous statements are privileged. Corporations, like individuals, possess free speech rights, and the alleged statements fall squarely within the scope of that privilege. See DuPont Merck Pharmaceutical Co. v. Superior Court, 78 Cal. App. 4th 562, 566 (2000); Lafayette Morehouse, Inc. v. Chronicle Publishing Co., 37 Cal. App. 4th 855, 862 (1995).

Moreover, to the extent Oracle’s statements were made in filings required to be made with the SEC, they are covered by the “official proceedings” privilege contained in California Civil Code § 47(b). Indeed, all of Oracle’s public statements regarding the tender offer fall within the same privilege by virtue of their topical and temporal nexus to an official proceeding, and also, as having been made in a public forum in connection with a matter of public interest. Cal. Civ. Code § 47(e); see Global Telemedia Int’l, Inc. v. Doe 1, 132 F. Supp. 2d 1261, 1265-66 (C.D. Cal. 2001) (statements about publicly traded company that had inserted itself into the public arena through press releases were matters of public interest).

C. The FAC States No Claim For Inducing Breach Of Contract.

To state a claim for interference with contract, a plaintiff must allege: (1) that it had a valid contract with a third party; (2) that the defendant knew it; (3) that the defendant intentionally took actions designed to induce breach of the contract; (4) that such breach resulted from the defendant’s acts and (5) that this produced damage to the plaintiff. Accuimage Diagnostics Corp. v. TeraRecon, Inc., 260 F. Supp. 2d 941, 956 (N.D. Cal. 2003) (citing Quelimane Co. v. Stewart Title Guaranty Co., 19 Cal. 4th 26, 55 (1998)).

The FAC alleges that several prospects decided to delay or forgo purchases from PeopleSoft because of the tender offer. FAC ¶¶ 35 (a)-(d), 42, 43, 69. But claims about Oracle’s alleged interference with these prospective customers cannot support a claim for interference with current contractual relationships. Prospective customers, by definition, did not have valid and existing contracts with PeopleSoft at the time of the alleged interference.

The FAC contains only one, conclusory allegation about an existing contract. It

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belonged to “Customer F,” ⁹ which allegedly “executed a contract to purchase software and services . . . two days before” Oracle’s alleged interference. FAC ¶ 39. Nowhere does the FAC allege that Oracle knew about this contract, which existed for only two days, or that Oracle intended to cause its breach. Indeed, the FAC does not even allege that “Customer F” breached the claimed contract, only that it “requested that PeopleSoft suspend implementation of its contract until after the uncertainty injected by Oracle’s Tender Offer had been resolved . . . .” Id.

Thus, in the sole instance in which PeopleSoft claims an existing contract was in any way affected, it fails to allege: (1) Oracle’s knowledge of that contract; (2) any action intentionally take by Oracle to induce its breach or (3) any breach, whether induced by Oracle or otherwise.

D. The FAC States No Claim For Intentional Interference With Prospective Economic Advantage.

The other “customers” mentioned by PeopleSoft were – as it acknowledges – just prospects. FAC ¶¶ 35(a)-(d), 42, 43, 69.

The requirements for a claim of interference with prospective economic advantage are more stringent than for claims of inducing breach of contract. “[T]he law usually takes care to draw lines of legal liability in a way that maximizes areas of competition free of legal penalties.” Della Penna v. Toyota Motor Sales, U.S.A. Inc., 11 Cal. 4th 376, 392 (1995).

This principle manifests itself in the competition privilege, which shields a party “from liability for inducing a third person not to enter into a prospective contractual relation with a business competitor.” Bed, Bath & Beyond of La Jolla, Inc. v. La Jolla Village Square Venture Partners, 52 Cal. App. 4th 867, 880 (1997). “The privilege applies where ‘(a) the relation

⁹ Vague allegations do not put Oracle on notice of the wrong allegedly committed. See Accuimage Diagnostics, 260 F. Supp. 2d at 956 (dismissing claim for intentional interference with contractual relationship because plaintiff’s allegations that “valid ‘contracts’” existed with an “unspecified third party” were insufficient to provide the required notice).

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[between the competitor and third person] concerns a matter involved in the competition between the actor and the competitor, and (b) the actor does not employ improper means, and (c) the actor does not intend thereby to create or continue an illegal restraint of competition, and (d) the actor’s purpose is at least in part to advance his interest in his competition with the other.’” Id. (citation omitted). Thus, the statements Oracle is alleged to have made, urging PeopleSoft’s prospective customers not to buy its products, are at the very heart of the competition privilege.

To override this privilege, PeopleSoft must plead that Oracle engaged in conduct that was independently wrongful, apart from the fact of the interference itself. Korea Supply Co. v. Lockheed Martin Corp., 29 Cal. 4th 1134, 1154 (2003) (a “plaintiff must plead that the defendant engaged in an act that is wrongful apart from the interference itself”); Bed, Bath & Beyond, 52 Cal. App. 4th at 881. “An act is not independently wrongful merely because defendant acted with an improper motive.” Korea Supply Co., 29 Cal. 4th at 1158. Rather, it must violate “some constitutional, statutory, regulatory, common law or other determinable legal standard.” Id. at 1159.

The acts on which PeopleSoft relies were neither “independent” of the alleged interference – indeed they are the very means by which the “interference” was allegedly effected – or “wrongful” in the sense of violating a “constitutional, statutory, regulatory, common law or other determinable standard.”

With one exception, the alleged “wrongful acts” are the same ones PeopleSoft elsewhere alleges as independent causes of action – deceptive advertising, trade libel, a campaign to damage its current and future business, intentional interference with contract, and violation of Business and Professions Code Section 17200. FAC ¶ 70. The infirmities of these claims are addressed elsewhere in this Memorandum. See supra Sections II.A-C and infra Sections II.E-F.

The one additional “wrongful act”, viz “fraud and deceit” (FAC ¶ 70), is difficult to analyze, since PeopleSoft does not allege it as a separate claim. California law requires that

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all the elements of fraud be pleaded with particularity. Small v. Fritz Companies, Inc., 30 Cal. 4th 167, 184 (2003). The FAC does not supply the required elements, or even disclose who is supposed to have been defrauded.

PeopleSoft itself does not claim to have relied on any false statement by Oracle. Nor, even if it had standing to assert their claims, could it assert that any of its customers – actual or prospective – were deceived by Oracle’s allegedly false promises of continued product support, since it told the federal court that “Oracle has already disclosed” its intention “to force its customers to select Oracle’s own products.” Supra at 5. Perhaps it means that its shareholders were deceived by the tender offer. But it told the federal court it was not challenging the accuracy of any statement in the tender offer or “seeking corrective disclosure of Oracle’s tender offer documents . . . .” Supra at 5; RJN Ex. 1 at 6:28. There is, in short, no apparent “fraud” that could support PeopleSoft’s claim of tortious interference with prospective economic advantage.

E. The FAC States No Claim For Negligent Interference With Prospective Economic Advantage.

To state a claim for negligent interference with prospective economic advantage, a plaintiff must allege, in addition to the elements required for a claim of interference with prospective economic advantage, that the defendant owed it a duty of care. Lange v. TIG Ins. Co., 68 Cal. App. 4th 1179, 1187-88 (1999) (judgment for plaintiff reversed because insurer owed no duty of care to brokers when it terminated agreement with general agent); LiMandri v. Judkins, 52 Cal. App. 4th 326, 348 (1997) (demurrer properly sustained where plaintiff failed to allege defendant owed it a duty of care).

PeopleSoft cannot plead that Oracle owes it a duty of care because, as a matter of law, competitors owe no duty of care to one another. See Accuimage Diagnostics, 260 F. Supp. 2d at 957; Stolz v. Wong Communications Ltd. Partnership, 25 Cal. App. 4th 1811, 1825 (1994).

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F. The FAC States No Claim Under Business And Professions Code Section 17200.

To state a cause of action for violation of Business and Professions Code Section 17200, a plaintiff must allege that the defendant committed underlying unlawful, unfair or fraudulent acts. PeopleSoft alleges two types of “unlawful, unfair or fraudulent” actions: (1) the announcement of the tender offer to interfere with PeopleSoft’s existing contracts and prospective economic advantage (FAC ¶ 80); and (2) the allegedly fraudulent public statements that PeopleSoft’s merger is “risky,” that future upgrades of PeopleSoft’s products will be a “major, major effort,” and that the potential future migration from PeopleSoft to Oracle products will be “easy” (FAC ¶ 82).

Neither the announcement of the tender offer, nor Oracle’s alleged public comments, amount to unlawful, unfair or fraudulent conduct supporting the claimed violation of Section 17200. Because these predicate claims fail, so does the entire cause of action. Khoury v. Maly’s of Cal., Inc., 14 Cal. App. 4th 612, 619 (1993) (Section 17200 claims fails because underlying claims fail).

First, as previously noted, the FAC does not allege a fraud claim. See supra at 10-11.

Second, the announcement of the tender offer was not unlawful and, therefore cannot, as a matter of law, be unfair. “[A] business practice cannot be unfair under [Section 17200] if that practice is permitted by law.” Churchill Village, L.L.C. v. General Elec. Co., 169 F. Supp. 2d 1119, 1130 (N.D. Cal. 2000) (denying preliminary injunction).

“Tender offers are legal corporate actions.” Kamerman, 891 F.2d at 431-32. Oracle’s tender offer for PeopleSoft’s shares is consistent with and authorized by federal laws, 15 U.S.C. § 78aa, 78(d), et seq., and PeopleSoft has represented that it is not challenging the accuracy of Oracle’s federally-mandated disclosures, or the process it followed to make the offer. See supra at 5.

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Indeed, the Williams Act specifies what constitutes “unfair” behavior relating to a tender offer. See Schreiber v. Burlington Northern, Inc., 472 U.S. 1, 11-12 (1985) (dismissing claim where alleged acts were not accompanied by any misrepresentation, nondisclosure, or deception). In that case the Supreme Court stated that permitting courts to apply “their own sense of what constitutes ‘unfair’ or ‘artificial’ conduct would inject uncertainty into the tender offer process . . . . This uncertainty would directly contradict the expressed congressional desire to give investors full information.” Id. at 12. Through the Williams Act, Congress intended to divest state courts of the obligation of overseeing tender offers for substantive fairness. Id.

By removing this action to federal court Oracle gave PeopleSoft the opportunity to challenge the fairness of the tender offer and the accuracy of any statement made “in connection with” it, under the applicable provisions of federal law. PeopleSoft declined to do so; indeed, it assured the federal court it would not do so.

III. CONCLUSION

Tender offers inevitably cause uncertainty on the part of the target company’s employees, owners and customers. But they also liberate underused assets, enhance shareholder value and oust entrenched managers. The laws which regulate them balance these interests by mandating full and accurate disclosures by both acquirer and acquiree and leave the decision to the shareholders and the marketplace. It is that process PeopleSoft asks this Court to abort.

Its prayer for relief makes that clear. It asks this Court to enjoin Oracle from “proceeding with the Tender Offer” or making any statement to “any person or entity known or believed to be an existing PeopleSoft customer” – not just about “any aspect of the Tender Offer, but about Oracle’s plans “to support any PeopleSoft products” or “migrate PeopleSoft customers to any Oracle products.” It would have this Court ignore Oracle’s First Amendment rights and block it even from “referring existing PeopleSoft customers to information about the proposed Tender Offer” or offer “any promise of technical or product support” to them. FAC at pp. 36-37.

In short, PeopleSoft seeks both to block Oracle from publicizing a tender offer –

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whose accuracy PeopleSoft told a federal court it would not challenge – and from competing with it in the marketplace.

There is no legal warrant for any of this.

DATED: September 11, 2003	Respectfully submitted,
	BINGHAM McCUTCHEN LLP
	By:	/s/ David M. Balabanian
		David M. Balabanian Attorneys for Defendants

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EX-99.(A)(5)(LXX)

EXHIBIT (a)(5) (lxx)

UNITED STATES DISTRICT COURT

FOR THE

DISTRICT OF CONNECTICUT

STATE OF CONNECTICUT, ex rel.	:
Attorney General RICHARD BLUMENTHAL	:	CIVIL ACTION NO. 3-03CV1072(AWT)
Plaintiff,	:
v.	:
ORACLE CORPORATION and PEPPER	:
ACQUISITION CORP.	:
Defendants.	:	AUGUST 4, 2003

AMENDED COMPLAINT

INJUNCTIVE RELIEF SOUGHT

I. INTRODUCTION

1. This is an antitrust action brought by the State of Connecticut by and through the Attorney General of the State to obtain equitable and other relief so as to prevent the adverse effects on competition that would result from the proposed unlawful acquisition by defendants Oracle Corporation (“Oracle”) and Pepper Acquisition Corp. (“Pepper Acquisition”) of PeopleSoft, Inc. (“PeopleSoft”).

II. PARTIES

2. Plaintiff, State of Connecticut, brings this action by and through its Attorney General, Richard Blumenthal, pursuant to Section 16 of the Clayton Act, 15 U.S.C. § 26, and Conn. Gen. Stat. §§ 35-32, 35-34 and 35-44a. As sovereign and parens patriae, and in its

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proprietary capacity, the State of Connecticut has a strong interest in maintaining the competitive health of the State’s economy.

3. The Attorney General of the State of Connecticut is the chief civil law enforcement officer of the State, and is authorized to bring this suit on behalf of the State, its citizens and its general economy. Plaintiff State of Connecticut is a purchaser of PeopleSoft enterprise software and stands to suffer significant loss and damage from the proposed acquisition due to the resulting loss of competition in the enterprise software market; from costs incurred by software degradation of its PeopleSoft enterprise software resulting from obsolescence due to limited innovation and product development; and from costs that may be incurred in switching from its currently installed PeopleSoft enterprise software to other enterprise software.

4. Defendant Oracle is an enterprise software provider organized and existing under the laws of the State of Delaware, with its principal place of business in Redwood City, California Oracle is one of the largest providers of enterprise software products and services internationally, nationally, and within the State of Connecticut.

5. A corporation organized under the laws of the State of Delaware, defendant Pepper Acquisition is a wholly-owned subsidiary of defendant Oracle, formed for the purpose of making the tender offer for all of the common stock of Oracle’s competitor, PeopleSoft.

6. PeopleSoft is an enterprise software provider organized and existing under the laws of the State of Delaware, with its principal place of business in Pleasanton, California. PeopleSoft is a direct competitor of defendant Oracle and is a major provider of enterprise software products, internationally, nationally, and within the State of Connecticut.

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III. JURISDICTION AND VENUE

7. This Court has jurisdiction over this matter pursuant to 28 U.S.C. § § 1331 and 1337(a). The plaintiff brings this action under Section 16 of the Clayton Act, as amended, 15 U.S.C. § 26 and Conn. Gen. Stat. §§ 35-32, 35-34 and 35-44a to prevent and restrain violations by defendants of Section 7 of the Clayton Act, 15 U.S.C. § 18, and Section 3 of the Connecticut Antitrust Act, Conn. Gen. Stat. § 35-26.

8. This Court has supplemental jurisdiction over the state law claim pursuant to 28 U.S.C. § 1367(a). The state law claim is so related to the federal law claim raised in this Complaint that it forms part of the same case or controversy under Article III of the United States Constitution. The issues raised by the state law claim are no more novel or complex than the federal law claim, nor do they substantially predominate over the federal law claim. Supplemental jurisdiction would avoid unnecessary duplication and multiplicity of actions, and should be exercised in the interests of judicial economy, convenience and fairness.

9. Defendant Oracle transacts business and is found within the District of Connecticut.

10. Venue is proper in the District of Connecticut under Section 12 of the Clayton Act, 15 U.S.C. § 22; 28 U.S.C. § 1391(c); and Conn. Gen. Stat. § 35-32(d).

IV. DEFINITIONS

11. “Enterprise” means a large business, governmental unit or institution generally employing ten thousand (10,000) or more employees or with an annual revenue of billions of dollars.

12. “Enterprise software” means a computer application program designed for and used by various enterprises including corporations, governmental units and agencies, educational institutions, and similar organizations for administrative, financial, customer

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relation or supply chain management purposes. It does not include operating systems, databases, or personal or productivity software such as word processors, spreadsheets and similar programs.

V. PROPOSED ACQUISITION

13. On or about June 9, 2003, Oracle, by and through its wholly-owned subsidiary Pepper Acquisition launched a cash tender offer to purchase all of the outstanding common stock of PeopleSoft for $16.00 per share. Oracle, on about June 18, 2003, increased this offer to $19.50 per share.

14. In its tender offer statement, Oracle announced that it seeks a majority interest in PeopleSoft and upon receiving a majority interest, Oracle will seek to merge PeopleSoft into one of Oracle’s subsidiaries.

15. In its tender offer statement, Oracle announced that upon obtaining control of PeopleSoft, Oracle intends to discontinue active sales of PeopleSoft’s products, including PeopleSoft’s enterprise software products, to new customers and to “facilitate the migration path” for PeopleSoft customers to transfer to Oracle products.

VI. INTERSTATE AND INTRASTATE COMMERCE

16. Oracle and PeopleSoft are engaged in interstate and intrastate commerce and in activities substantially affecting interstate and intrastate commerce. Oracle and PeopleSoft market and sell enterprise software services throughout the United States and Connecticut. Oracle and PeopleSoft sell their software and services to customers across state lines. Oracle’s and PeopleSoft’s sales and commercial relationships in the United States and in Connecticut, represent a regular, continuous and substantial flow of interstate and intrastate commerce, and have had a substantial effect upon interstate commerce as well as intrastate commerce.

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VII. ANALYSIS OF MERGERS

17. In attempting to determine whether an acquisition may substantially tend to lessen competition, it is first necessary to identify distinct lines of commerce or product markets which are affected by the acquisition. After identifying affected product markets, the geographical areas or geographic markets in which the particular product is purchased or sold must be identified. Once the product and geographic markets are defined, market shares may be calculated for the acquiring firm, the acquired firm and other major firms in the market.

18. The Herfindahl-Hirschman Index, or HHI as it is commonly known, is a well recognized and accepted measure of market concentration. The HHI is utilized in the United States Department of Justice and Federal Trade Commission Horizontal Merger Guidelines (1992) and the National Association of Attorneys General Horizontal Merger Guidelines (1993). The HHI is computed by squaring the market share percentage of each firm competing in the defined market and then summing the resulting numbers. An industry is considered to be unconcentrated if the postmerger HHI is less than 1000 points; any industry is considered to be moderately concentrated when the postmerger HHI is between 1000 and 1800 points; and any industry is considered to be highly concentrated when the postmerger HHI exceeds 1800 points. The HHI also permits a measurement of the addition to market concentration that is brought about by an acquisition. In a moderately concentrated market (between 1000 and 1800 points) a merger related increase of over 100 points is thought to significantly increase concentration; and in a highly concentrated market (over 1800 points) an increase of over 100 points is presumed to likely create or enhance market power or facilitate its exercise.

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VIII. MARKET DEFINITION AND CONCENTRATION

A. Relevant Product Markets

1. Enterprise Financial Applications Software

19. A relevant product market affected by this proposed acquisition is the market for enterprise financial applications software.

20. Enterprise financial applications software includes those software programs that perform computing functionality in the nature of general ledger, accounts receivable, accounts payable, asset management, financial reporting, regulatory compliance, and other similar tasks, for enterprise users.

21. Due to the need of enterprise financial applications software to execute specific computing tasks on a large-scale basis (“scalability”) with a high level of performance, and to offer functionality, implementation and support on a national or global basis, this market does not include companies that offer small and mid-tier financial software programs, databases, operating systems or other software. Thus, these excluded products are not a significant competitive constraint on enterprise financial applications software; a small but significant price increase for enterprise financial applications software would not cause a sufficient number of customers to switch to these excluded products so as to make the increase unprofitable.

1.  Enterprise Human Resources Software

22. Another relevant product market affected by this proposed acquisition is the market for enterprise human resources software.

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23. Enterprise human resources software are those software programs that perform computing functionality in the nature of payroll, timekeeping, recruitment, performance evaluation, training or other similar tasks for enterprise users.

24. Due to the need of enterprise human resources software to execute computing tasks with scalability, with a high level of performance, and to offer functionality, implementation and support on a national or global basis, this market does not include companies that offer small and mid-tier human resources software programs, databases, operating systems or other software. Thus, these excluded products are not a significant competitive constraint on enterprise human resources software; a small but significant price increase for enterprise human resources software would not cause a sufficient number of customers to switch to these excluded products so as to make the increase unprofitable.

B. Geographic Market

25. The relevant geographic market in which to assess the effect to this proposed acquisition is: (a) the entire State of Connecticut, or, alternatively, (b) the United States of America, or alternatively (c) the international market.

C. Market Concentration

26. At present Oracle, PeopleSoft and one other company are the only meaningful participants in the relevant geographic market for enterprise financial applications software and enterprise human resources software. Thus, the proposed acquisition would reduce the number of effective competitors from three to two and create a duopoly in each of the relevant markets.

27. The relevant markets are highly concentrated by HHI measurements and would become significantly more so as a result of this proposed acquisition. If consummated, the acquisition will create or enhance market power and facilitate its exercise.

7

IX. ANTICOMPETITIVE EFFECTS OF PROPOSED ACQUISITION

28. The effect of the proposed acquisition will be substantially to lessen competition in the aforesaid lines of trade and commerce in the following ways, among others:

a. Existing competition and the potential for increased competition between Oracle and PeopleSoft in the relevant markets for the provision of the relevant products will be permanently eliminated;

b. Concentration in the relevant product markets in the State of Connecticut will be significantly increased;

c. Concentration in the relevant product markets in the United States of America will be significantly increased;

d. Concentration in the relevant product markets in the international market will be significantly increased, and

e. Competition in the relevant product markets will be substantially lessened.

29. In addition, because this merger would reduce the number of enterprise software competitors from three to two in the relevant markets, it would facilitate tacit coordination and substantially increase the likelihood of increased interdependent pricing between the merged entity and the remaining enterprise software provider.

30. The merger of Oracle and PeopleSoft, by increasing substantially the risk of coordinated behavior in the relevant enterprise software markets, would Likely lead to higher prices, less consumer choice and lower service quality, both for the merged firm and for the remaining enterprise software company interacting with the merged firm, than would exist absent the merger.

31. Entry or expansion on a widespread scale will not be timely, likely, or sufficient to undo the competitive harm that would likely result from the proposed merger.

32. Entry into the relevant markets by a new enterprise software provider would be extremely difficult, time-consuming, and expensive. The enterprise software industry serves

8

enterprises through complex software that is often customized to serve a particular customer’s specific needs. Thus, costs and risks associated with switching providers can be extremely high. Moreover, enterprises often prefer to obtain their enterprise financial applications software, enterprise human resources software and other enterprise software such as customer management and supply chain management software, from a single software provider to maximize manageability, efficiency and interoperability, while minimising costs and administrative inconvenience. Thus, enterprises will be reluctant to switch to a smaller or midsize financial or human resources software provider with untested scalability, performance and international effectiveness and without the proven ability to offer a full range of enterprise software.

33. Oracle has publicly announced that it plans to discontinue or diminish the PeopleSoft lines of software. The proposed merger would, therefore, create substantial costs for the customers forced to switch from their presently installed PeopleSoft software. Indeed, the State, as a significant purchaser of PeopleSoft enterprise software, will stand to lose up to tens of millions of dollars if the proposed acquisition is allowed to proceed.

34. Unless Oracle’s proposed acquisition of PeopleSoft is enjoined, the State and its economy, agencies, political subdivisions, businesses, institutions and citizens will be injured.

X. FIRST CLAIM FOR RELIEF—CLAYTON ACT. SECTION 7

35. The plaintiff repeats and realleges each and every allegation contained in paragraphs 1-34 above, with the same force and effect as if here set forth in full.

36. Through the actions complained of herein, the defendant has violated Section 7 of the Clayton Act, 15 U.S.C. § 18.

9

XI. SECOND CLAIM FOR RELIEF—CONNECTICUT ANTITRUST ACT, SECTION 3

37. The plaintiff repeats and realleges each and every allegation contained in paragraphs 1-34 above, with the same force and effect as if here set forth in full.

38. Through the actions complained of herein, the defendants have violated Section 3 of the Connecticut Antitrust Act, Conn. Gen. Stat. § 35-26.

10

XII. REQUEST FOR RELIEF

WHEREFORE, the plaintiff, State of Connecticut, respectfully requests that this Court:

1. Adjudge and declare that Oracle’s proposed acquisition of PeopleSoft is in violation of Section 7 of the Clayton Act, 15 U.S.C. § 18, and Section 3 of the Connecticut Antitrust Act, Conn. Gen. Stat § 35-26.

2. Permanently enjoin Oracle from acquiring PeopleSoft.

3. Award to the plaintiff its costs of suit and appropriate attorneys’ fees.

4. Award to the plaintiff, State of Connecticut, such other and further relief as the Court may deem just and proper.

11

	PLAINTIFF STATE OF CONNECTICUT RICHARD BLUMENTHAL ATTORNEY GENERAL STATE OF CONNECTICUT Federal Bar No. ct05294
By:	/s/    STEVEN M. RUTSTEIN
	STEVEN M. RUTSTEIN Assistant Attorney General Department Head/Antitrust Department Federal Bar No. ct09086
By:	/s/    ROGER F. REYNOLDS
	ROGER F. REYNOLDS Assistant Attorney General Antitrust Department Federal Bar No. ct18126 CLARE E. KINDALL Assistant Attorney General Federal Bar No. ct13688
	55 Elm Street Hartford, CT 06106 Tel: (860) 808-5040 Fax: (860) 808-5033

Dated: August 4, 2003

12

CERTIFICATE OF SERVICE

I, Roger F. Reynolds, hereby certify that on August 4, 2003, I caused copies of the foregoing Amended Complaint to be served on Defendants, Oracle Corporation and Pepper Acquisition Corp., by facsimile and by mailing the document first-class, postage prepaid, to duly authorized legal representatives of those parties as follows:

Counsel for Defendants Oracle Corporation and Pepper Acquisition Corp.

William M. Rubenstein, Esq.

Eric D. Beal, Esq.

Axinn, Veltrop & Harkrider LLP

90 State House Square

11^th Floor

Hartford, CT 06103

Tel. (860) 275-8100

Fax. (860) 275-8101

/s/    ROGER F. REYNOLDS

ROGER F. REYNOLDS

Assistant Attorney General

13

EX-99.(A)(5)(LXXI)

Exhibit (a)(5)(lxxi)

UNITED STATES DISTRICT COURT

DISTRICT OF CONNECTICUT

STATE OF CONNECTICUT, ex rel.	)
Attorney General	)	CIVIL ACTION NO. 03-CV-1072 (AWT)
RICHARD BLUMENTHAL	)
Plaintiff,	) )
v.	) )
ORACLE CORPORATION and PEPPER ACQUISITION CORP.	) ) )
Defendants.	) )	August 18, 2003

DEFENDANTS’ MOTION TO DISMISS

Pursuant to Rules 12 (b) (1) and 12 (b) (6) of the Federal Rules of Civil Procedure, the defendants, Oracle Corp. and Pepper Acquisition Corp., hereby respectfully move this Court to dismiss the Amended Complaint filed by the plaintiff, the State of Connecticut ex rel. Attorney General Richard Blumenthal, on August 4, 2003. The Amended Complaint challenges Oracle’s tender offer for shares of PeopleSoft, Inc. (“PeopleSoft”) under Section 7 of the Clayton Act, 15 U.S.C. § 18, and Section 3 of the Connecticut Antitrust Act, Conn. Gen. Stat. § 35-26. The defendants rely on the Memorandum of Law and the Declaration of Eric D. Beal filed concurrently with this motion.

The federal claim under section 7 of the Clayton Act should be dismissed: (i) pursuant to Rule 12 (b) (1) because the Connecticut Attorney General (the “AG”) does not have standing as parens patriae; (ii) pursuant to 12 (b) (6) because the Amended Complaint fails to allege antitrust injury to Connecticut; and (iii) pursuant to Rule 12 (b) (1), because the AG lacks capacity, or statutory authorization under state law, to bring this claim.

ORAL ARGUMENT REQUESTED

The state law antitrust claim under section 3 of the Connecticut Antitrust Act must also be dismissed pursuant to Rule 12 (b) (6) because the Connecticut antitrust laws do not apply to unaccepted tender offers or, in the alternative, the AG’s state law claim should also be dismissed for lack of supplemental jurisdiction because this Court lacks subject matter jurisdiction over the federal claim.

Finally, even if this Court were to recognize standing in the AG, both the state and federal claims in the Amended Complaint should be dismissed pursuant to Rule 12 (b) (1) because they are premature and unripe.

For these reasons, as more fully set forth in the Memorandum of Law filed concurrently herewith, the Amended Complaint should be dismissed in its entirety.

WHEREFORE, the defendants respectfully request that this Court dismiss the Amended Complaint pursuant to Federal Rules of Civil Procedure 12 (b) (1) and 12 (b) (6).

Dated: August 18, 2003

Respectfully Submitted,

/s/    WILLIAM M. RUBENSTEIN

William M. Rubenstein (ct08834)

E-mail: wmr@avhlaw.com

Eric D. Beal (ct23167)

E-mail: exb@avhlaw.com

Axinn, Veltrop & Harkrider LLP

90 State House Square

Hartford, CT 06103-3702

Telephone: 860-275-8100

Facsimile: 860-275-8101

Attorneys for Defendants

ORACLE CORPORATION and

PEPPER ACQUISITION CORP.

CERTIFICATION

THIS IS TO CERTIFY that a copy of the foregoing Motion to Dismiss has been delivered by hand this 18^th day of August, 2003 to:

Steven Mark Rutstein, Esq.

Roger F. Reynolds, Esq.

Attorney General’s Office

55 Elm St.

Hartford, CT 06106

Clare E. Kindall, Esq.

Attorney General’s Office

55 Elm St.

Hartford, CT 06106

/s/    ERIC D. BEAL

Eric D. Beal

AXINN, VELTROP & HARKRIDER LLP

UNITED STATES DISTRICT COURT

DISTRICT OF CONNECTICUT

STATE OF CONNECTICUT, ex rel.	)
Attorney General	)	CIVIL ACTION NO. 03-CV-1072 (AWT)
RICHARD BLUMENTHAL	)
Plaintiff,	) )
v.	) )
ORACLE CORPORATION and PEPPER ACQUISITION CORP.	) ) )
Defendants.	) )	August 18, 2003

DEFENDANTS ORACLE CORP. AND PEPPER ACQUISITION CORP.’S

MEMORANDUM OF LAW IN SUPPORT OF MOTION TO DISMISS

	AXINN, VELTROP & HARKRIDER LLP
	90 State House Square
	Hartford, CT 06103-3702
	(860) 275-8100
William M. Rubenstein
Eric D. Beal
Attorneys for Defendants
ORACLE CORPORATION and
PEPPER ACQUISITION CORP.
August 18, 2003

ORAL ARGUMENT REQUESTED

TABLE OF CONTENTS

TABLE OF AUTHORITIES	iii
INTRODUCTION	1
DESCRIPTION OF THE AMENDED COMPLAINT	4
ARGUMENT	6
I. THE ATTORNEY GENERAL HAS NO STANDING OR AUTHORITY TO BRING THE PRESENT CLAYTON ACT CLAIM	6
A.     Parens Patriae is a Limited Exception to General Standing Analysis Applied to Private Plaintiffs	7
1. The AG Lacks Standing as Parens Patriae	8
a.      The Amended Complaint does not Describe a Distinct “quasi-sovereign interest”	11
b.      The Amended Complaint Fails to Allege “an injury to a substantial segment” of the Population of Connecticut	13
c.      “Enterprises” are Able to Obtain identical Relief.	15
2.      Other Policy Considerations Militate Against Recognizing Parens Patriae Standing	17
3.      Conclusion	18
B.     The AG Cannot Bring this Suit to Protect Connecticut’s Proprietary Interests Because the Amended Complaint Fails to Allege that Connecticut is Threatened with Antitrust Injury	19
1.      Antitrust Injury	20
2.      Connecticut is not Threatened with Antitrust Injury because It Already Purchased Its Software	21
3.      The Alleged Harm to Connecticut Does not “Flow From” the Anticompetitive Effects Alleged in the Amended Complaint and is Not of the Type of Injury the Antitrust Laws were Designed to Prevent	22
C.     The AG Lacks Authority Under State Law to Bring this Federal Claim	26
II. THE COMPLAINT FAILS TO STATE A CLAIM UNDER STATE LAW	31
III. THE PLAINTIFF’S CLAIMS ARE PREMATURE	33
CONCLUSION	38

ii

TABLE OF AUTHORITIES

CASES

Abbott Lab. v. Gardner, 387 U.S. 136 (1967)	34
Abrams v. 11 Cornwell Co 695 F. 34 (2d Cir. 1982), vacated in part on other grounds, 718 F.2d 22 (2d Cir. 1983)	11,12,13
Alberta Gas Chemicals Ltd. v. E.I. du Pont de Nemours & Co 826 F.2d 1235 (3d Cir. 1987)	24
Alfred L. Snapp & Son. Inc. v. Puerto Rico. 458 U.S. 592 (1982)	9,10,13
Allied Signal. Inc v. B.F. Goodrich Co., 183 F.3d 568 (7th Cir. 1999)	16
Associated Gen. Contractors of California. Inc. v. California State Council of Carpenters. 459 U.S. 519 (1983)	7
Baxley v. Rutland. 409 F. Supp. 1249 (M.D. Ala. 1976)	27
Blumenthal v. Barnes. 261 Conn. 434 (2002)	26,27,28
B.V. Optische Industrie de Oude Delft v. Hologic, Inc., 909 F. Supp. 162 (S.D.N.Y. 1995)	5
Brown Shoe Co. v. United States, 370 U.S. 294 (1962)	4
Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc., 429 U.S. 477 (1976)	20,23,24,25
Burch v. Goodyear Tire & Rubber Co 420 F. Supp. 82 (D. Md. 1976), aff’d, 554 F.2d 633 (4th Cir. 1977)	9
California v. American Stores. 495 U.S. 271 (1990)	8,21
Cargill, Inc. v. Monfort of Colorado. Inc 479 U.S. 104 (1986)	20,21
Cedars-Sinai Medical Center v. Watkins, 11 F.3d 1573 (D.C. Cir. 1993)	35
Chicago & Northwestern Trans. Co. v. SOO Line RR Co., 739 F. Supp. 447 (D. III. 1990)	36
Connecticut v. Physicians Health Servs., Inc 103 F. Supp. 2d 495 (D. Conn. 2000)	10
Crestar Mort. Corp. v. Peoples Mort. Co., 818 F. Supp. 816 (E.D. Pa. 1993)	36
Estados Unidos Mexicanos v. Decoster, 229 F.3d 332 (1st Cir. 2000)	9

iii

Fischer v. NWA, Inc., 883 F.2d 594 (8th Cir. 1989)	25
Florida Seed Co. v. Monsanto, 105 F.3d 1372 (11th Cir. 1997)	25
Garabet v. Autonomous Tech. Corp 116 F. Supp. 2d 1159 (C.D. Cal. 2000)	21
Georgia v. Pennsylvania R.R., 324 U.S. 439 (1945)	8
Glen Holly Entm’t v. Tektronix, Inc., 100 F. Supp. 2d 1073 (C.D. Cal. 1999)	21,22,23
G.K.A. Beverage Corp. v. Honickman, 55 F.3d 762 (2d Cir. 1995)	24
Go-Video. Inc. v. Matsushita Elec. Indus. Co Ltd 1992 U.S. Dist. LEXIS 16539, 1992-2 Trade Cas. (CCH) 69,972 (D. Ariz. Sept. 15, 1992), aff’d, 15 F.3d 1085 (9th Cir. 1994) (mem.)	25
Hack v. President and Fellows of Yale College. 237 F.3d 81 (2d Cir. 2000), cert. denied. 534 U.S. 888 (2001)	5,6
Illinois v. Life of Mid-America Ins. Co 805 F.2d 763 764 (7th Cir. 1986)	12
Illinois DOT v. Hinson, 122 F.3d 370 (7th Cir. 1997)	3,19
In re Drexel Burnham Lambert Group Inc 995 F.2d 1138 (2d Cir. 1993)	36
In re Mercedes Benz Antitrust Litig., 213 F.R.D. 180 (D.N.J. 2003)	21
In re Merrill Lynch Ltd. P’ships Litig., 154 F.3d 56 (2d Cir. 1998)	33
Land O’ Lakes Creameries v. Louisiana State Bd. of Health. 160 F. Supp. 387 (E.D. La. 1958)	12,13
Leeds v. Meltz, 85 F.3d 51, 53 (2d Cir. 1996)	6
Makarova v. United States. 201 F.3d 110 (2d Cir. 2000)	7
Mathias v. Daily News. L.P 152 F. Supp. 2d 465 (S.D.N.Y. 2001)	5
McKeown Distributors, Inc. v. GYP-Crete Corp 618 F. Supp. 632 (D. Conn. 1985)	32
Metzenbaum v. FERC, 675 F.2d 1282 (D.C. Cir. 1982)	34,35
Moore v. Mitchell. 281 U.S. 18 (1930)	26
New York v. Conciliation and Appeals Bd., 123 Misc. 2d 47 (N.Y. 1984)	16

iv

New York v. Holiday Inns. Inc., 656 F. Supp. 675 (W.D.N.Y. 1984)	14,15,17
New York v. Mid-Hudson Med. Group. 877 F. Supp. 143 (S.D.N.Y. 1995)	14
New York v. New Jersey. 256 U.S. 296 (1921)	9
New York v. Peter & John’s Pump House. 914 F. Supp 809 (N.D.N.Y 1996)	14,15
New York ex rel. Spitzer v. Wallkill, 2001 U.S. Dist. LEXIS 13364 (S.D.N.Y 2001)	11,13,14
Oracle Corp. & Pepper Acquisition Corp. v. Peoplesoft et al., CV 20377NC (Del. Ch, June 18, 2003)	36
Pani v. Empire Blue Cross Blue Shield. 152 F.3d 67 (2d Cir. 1998)	6
Pennsylvania v. Kleppe, 533 F.2d 668 ( D.C. Cir. 1976)	13,15,17
Pennsylvania v. West Virginia. 262 U.S. 553 (1923)	9
Philadelphia Housing Authority v. American Radiator & Stand. Sanitary Corp 309 F. Supp. 1057 (E.D. Pa 1969)	27
Puerto Rico v. Bramkamp, 654 F.2d 212 (2d Cir. 1981)	15,16
SEIU v. Philip Morris. Inc., 249 F.3d 1068 (D.C. Cir. 2001), cert. denied, 534 U.S. 994 (2001)	17
Shea v. First Federal Savings & Loan Assoc., 184 Conn. 285 (1981)	32
South Austin Coalition Community Council v. SBC Communications Inc., 191 F.3d 842 (7th Cir. 1999)	36,37
Step-Saver Data Systems, Inc. v. Wyse Technology, 912 F.2d 643 (3d Cir. 1990)	35
Suitum v. Tahoe Regional Planning Agency, 520 U.S. 725 (1997)	34
Support Ministries v. Waterford. 799 F. Supp. 272 (N.D.N.Y. 1992)	14,16
United States v. E. I. du Pont de Nemours & Co 353 US 586 (1956)	4
United States v. American Airlines. Inc., 570 F. Supp. 654 (N.D. Tex 1983), rev’d on other grounds, 743 F.2d 1114 (5th Cir. 1985)	32
United States v. Michigan Nat’l Corp., 1974 U.S. Dist. LEXIS 12205 (E.D. Mich. Feb. 19, 1974)	37

v

United States v. Muzak LLC, 275 F.3d 168 (2d Cir. 2001)	38
US West Communications v. MFS Intelenet, Inc., 193 F.3d 1112 (9th Cir. 1999), cert. denied, 530 U.S. 1297 (2000)	36
Volvo N. Am. Corp. v. Men’s Int’l Prof 1 Tennis Council. 857 F.2d 55 (2d Cir. 1988)	37,38
STATUTES AND LEGISLATIVE MATERIALS
15 U.S.C. § 15c	18,31
15. U.S.C. § ] 8	4,37
15 U.S.C. § 26	6,20,21
Connecticut Antitrust Act, Conn. Gen. Stat. §§ 35-24 to 35-46	28
Connecticut General Statutes § 35-32	26,29,30,31
Connecticut General Statutes § 35-44a	26,28,29,30
Connecticut General Statutes § 35-34	26,29,32,33
Connecticut General Statutes § 35-26	4,28,31,32
Connecticut General Statutes § 35-27	28
Connecticut General Statutes § 35-45	28
H.R. Rep. No. 94-499, at 9-10 (1975)	18
Conn. Pub. Acts 75-508	28
Conn. Pub. Acts 76-218	29
OTHER MATERIALS
Federal Rules of Civil Procedure, Rule 12 (b) (1)	7,26,33
Federal Rules of Civil Procedure, Rule 12 (b) (6)	6,7,31
Federal Rules of Civil Procedure, Rule 17 (b)	27
Areeda & Hovenkamp, Antitrust Law, 1403 (2d ed.)	32
Judith A. Maynes, et al., Recent History of the Connecticut Antitrust Act, 50 Conn. B.J. 274 (1976).	28,30

vi

George D. Brodigan, Connecticut Anti-trust Act, 47 Conn. B.J. 2 (1973)	28
Laurence Tribe, American Constitutional Law. § 3-20 (3d Ed. Foundation Press 2000)	9
Statement of R. Hewitt Pate before the U.S. House of Rep. Judiciary Committee, p. 9 (July 24, 2003) (available at <http://www.usdoj.gov/atr/public/testimonv/201190.htm>.)	37
“The Connecticut 100,” (last viewed on August 16, 2003) <www2. Connecticutmag.com/site/ct100.asp>	2
“Core-CT Project Fact Sheet,” (last viewed on August 16, 2003) <www.core-ct.state.us.fact_sheet>	19

vii

UNITED STATES DISTRICT COURT

DISTRICT OF CONNECTICUT

STATE OF CONNECTICUT, ex rel.	)
Attorney General	)	CIVIL ACTION NO. 03-CV-1072 (AWT)
RICHARD BLUMENTHAL	)
	)
Plaintiff,	)
	)
v.	)
	)
ORACLE CORPORATION and	)
PEPPER ACQUISITION CORP.	)
	)
Defendants.	)	August 18, 2003

DEFENDANTS ORACLE CORP. AND PEPPER ACQUISITION CORP.’S

MEMORANDUM OF LAW IN SUPPORT OF MOTION TO DISMISS

INTRODUCTION

Just nine days after Oracle Corp. (“Oracle”) tendered for the shares of PeopleSoft, Inc. (“PeopleSoft”), the Connecticut Attorney General (the “AG”), without standing or authority, filed this premature lawsuit seeking a permanent injunction preventing any merger of the two firms, both Delaware corporations headquartered in California. The AG brought this action without undergoing normal investigation or even first contacting Oracle. Because there was no conceivable antitrust reason for such haste, a point which the AG has conceded by not also seeking a preliminary injunction, it is apparent that this lawsuit was timed, not to reach the merits, but to preempt antitrust review by influencing the shareholder response to the tender offer in this high-profile contest for corporate control.¹

¹ In fact, the AG sought to block Oracle’s offer before it had been considered by the PeopleSoft Board, before any hearing in — much less a decision from — the Delaware court that must decide whether PeopleSoft is required to redeem its “shareholders’ rights plan,” more commonly known as a “poison pill,” and before the Department of Justice had even begun its investigation of the antitrust merits of the proposed transaction. Subsequent events have shown why the AG’s lack of deliberation was misguided: On June 19, PeopleSoft rejected

In his first complaint, the AG attempted to bootstrap this lawsuit into this Court by representing as “parens patriae” a tiny class of enormous businesses dubbed “enterprises.” As recognized in longstanding decisions of the Supreme Court and the United States Court of Appeals for the Second Circuit, however, parens patriae standing is not available where a state seeks to represent companies “generally employing ten thousand (10,000) or more employees” or with multi-billion dollar annual revenues. (Amended Compl. 11.)² To the best of Oracle’s knowledge, in over fifty years of state parens patriae antitrust enforcement, no other attorney general has ever sued to protect such a small and powerful class of “consumers” where the harm to the general economy or individual consumers of the state is comparably remote and speculative.

Belatedly recognizing that enterprises can fend for themselves without the protection of a parens patriae, the AG amended his complaint to assert that he also represents Connecticut’s own interests as a current licensee of PeopleSoft. (Amended Compl. 2.) But, this stop-gap position is similarly unavailing because the harms purportedly threatening Connecticut do not flow from the alleged anticompetitive effect of the proposed merger. Although contradicted by Oracle’s public commitments to continue support for PeopleSoft’s software, the AG alleges that, if the tender offer succeeds, Oracle will “discontinue or diminish the PeopleSoft lines of software” causing Connecticut to incur costs in ameliorating any degradation or obsolescence of its existing PeopleSoft products. (Amended Compl. 3, 33.) Even assuming the truth of this allegation, such costs occur anytime a supplier discontinues a product and are not a symptom of

Oracle’s sweetened offer. On June 30, the United States Department of Justice issued a “Second Request” opening an extended investigation of the antirust merits of a transaction.

²    Connecticut’s lack of any special interest in these often-international corporations is demonstrated by the fact Chat only twenty companies with annual revenues above $2 billion are headquartered in the state. See “The Connecticut 100,” (last viewed on August 16, 2003) <www2.Connecticutmag.com/site/ct100.asp>.

2

a market-wide reduction of competition. For instance, now that PeopleSoft has recently acquired one of its rivals, J.D. Edwards,—a transaction that the AG did not oppose—J.D. Edwards customers will suffer a similar inconvenience should PeopleSoft decide to discontinue any J.D. Edwards product. Such an “injury” would not be caused by any antitrust violation, but rather would be a possible consequence of the merger itself whether or not it violates the antitrust laws.

The Amended Complaint’s failure to articulate an antitrust injury to Connecticut underscores this essential problem with the AG’s lawsuit: it seeks to wrest control of this antitrust litigation from the enterprises directly affected and from the U.S. Department of Justice, which Congress has designated as the governmental enforcer of federal antitrust laws. The AG’s powers, however, are circumscribed by standing doctrine and Connecticut statute, which separately prevent the AG from meddling where the state has no legal interest. As the Seventh Circuit observed in an analogous case: “The main contemporary reason for having rules of standing, besides minimizing judicial caseloads and judicial interference with the life of the nation, is to prevent kibitzers, bureaucrats, publicity seekers, and ‘cause’ mongers from wresting control of litigation from the people directly affected . . . .” Illinois DOT v. Hinson, 122 F.3d 370, 373 (7th Cir. 1997) (Posner, J). Oracle, therefore, moves this Court to dismiss the Amended Complaint pursuant to Federal Rules of Civil Procedure 12 (b) (1) and (b) (6).

The federal claim under section 7 of the Clayton Act must be dismissed because:

The AG does not have standing as parens patriae (discussed in part I.A., p. 7)

The Amended Complaint fails to allege antitrust injury to Connecticut, an essential element of a cause of action premised on the proprietary interest of the state (discussed in part I.B., p. 19)

The AG lacks capacity, or statutory authorization under state law, to bring this claim (discussed in part I.C., p. 26)

3

The state law antitrust claim must also be dismissed:

Connecticut antitrust laws do not apply to unaccepted tender offers, so the Amended Complaint fails to state a claim under state antitrust law (discussed in part II, p. 31)

Because this Court lacks subject matter jurisdiction over the federal claims, the AG’s state law claims should also be dismissed for lack of supplemental jurisdiction (discussed in part II)

Finally, even if this Court were to recognize standing in the AG, his hastily brought claims are premature and unripe and, for that reason alone, should be dismissed. (discussed in part III, p. 33.)

DESCRIPTION OF THE AMENDED COMPLAINT

The Amended Complaint challenges Oracle’s tender offer for PeopleSoft shares (the “Tender Offer”) under Section 7 of the Clayton Act, 15. U.S.C. § 18, and Section 3 of the Connecticut Antitrust Act, Conn. Gen. Stat. § 35-26, alleging that any merger between two companies would cause competitive harm in two purported markets.

The heart of the Amended Complaint is its gerrymandered definition of an “enterprise.” Contrary to the repeated admonitions of the Supreme Court that product markets in antitrust cases must be drawn in terms of reasonable interchangeability, United States v. E. I. du Pont de Nemours & Co 353 U.S. 586, 593-95 (1957), and must reflect economic reality, Brown Shoe Co. v. United States. 370 U.S. 294, 326 (1962), the Amended Complaint simply asserts, ipse dixit, that “enterprises” have computer software needs that are distinct from smaller but still substantial entities and that software designed for their use thus occupies distinct antitrust product markets, specifically: (1) the market for “enterprise financial applications software” and (2) the market for “enterprise human resources software.” (Amended Compl. 19-24 (emphasis added).) In the absence of any explanation for the uniqueness of those enterprise

4

software products, the defining characteristic of those markets appears to be that they embolden the Amended Complaint to state, albeit incorrectly, that “[a]t present, Oracle, PeopleSoft and one other company are the only meaningful participants in the relevant geographic market”³ for the specified products and that the proposed acquisition would thus “create a duopoly in each of the relevant markets.” (Amended Compl. 26.) While that proposition certainly would create the appearance of an antitrust issue, it amounts to drawing a bullseye around one’s arrow.⁴

Similarly, the AG talks around an antitrust analysis without asserting any meaningful or rational facts. For example, despite the pro forma explanation of the HHI index (Amended Compl. 18), the Amended Complaint never applies the methodology to the facts of this case, or even provides estimated market shares. Furthermore, the Amended Complaint offers only a cursory and inadequate discussion of existing business software vendors’ ability to adapt their products for use by enterprise customers. Even assuming the truth of the allegation that enterprise software has unique requirements, it is hard to believe that rich and skilled companies like Microsoft, Siebel Systems, or any of the other myriad of large business software vendors are unable to adapt their similar products to respond to any attempted exercise of market power by enterprise software providers. The suggestions that established reputation or operations “on a national or global basis” are required cannot explain how Microsoft, the world’s largest software company, or Siebel Systems, the leading vendor of customer relationship management software,

³As to the geographic side of market definition, the Amended Complaint takes a decidedly scatter-shot approach, efining the relevant market as, alternatively, the State of Connecticut, the United States, or some undefined international market.” (Amended Compl. 25.) Given that range of alternatives, the proper geographic market is lmost certainly one of them, although such an allegation hardly gives Oracle much notice as to the State’s theory— if indeed it has one.

⁴ Where courts have found that plaintiffs have defined markets that defy economic reality to bolster their claims, they have not hesitated to dismiss antitrust actions. See, e.g., Hack v. President and Fellows of Yale College. 237 F.3d 81, 85 (2d Cir. 2000); B.V. Optische Industrie de Oude Delft v. Hologic. Inc., 909 F. Supp. 162, 171-73 S.D.N.Y. 1995); Mathias v. Daily News, L.P., 152 F. Supp. 2d 465, 482 (S.D.N.Y. 2001) (collecting cases “confirm[ing] the difficulty in delineating a relevant market based on artificially narrow boundaries”).

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can be discounted on such grounds.

Finally, the Amended Complaint fails to allege that Oracle and PeopleSoft have come to an agreement, or that any acquisition has actually occurred or is imminent. In fact, PeopleSoft’s management and directors have made it very clear that they do not agree to any merger or acquisition and they have erected substantial barriers to such an agreement, including suing Oracle to prevent the transaction. Thus, the Amended Complaint has not alleged, and cannot allege, an agreement as required by the statutes under which the AG claims relief.

Based on this fragmentary and misleading analysis, the AG claims statutory authorization to seek an injunction barring Oracle from purchasing PeopleSoft under Section 16 of the Clayton Act, 15 U.S.C. § 26, and Conn. Gen. Stat. §§ 35-32, 35-34 and 35-44a. However, for the reasons explained below, these provisions do not give the AG standing or authorization to insert himself into this high-profile contest for corporate control.

ARGUMENT

I. THE ATTORNEY GENERAL HAS NO STANDING OR AUTHORITY TO BRING THE PRESENT CLAYTON ACT CLAIM

Applicable Legal Standards

For purposes of a motion to dismiss under Fed. R. Civ. P. 12 (b) (6), the Court must deem all of the allegations in the complaint as true and resolve any inconsistencies or inferences in favor of the plaintiff. See Pani v. Empire Blue Cross Blue Shield, 152 F.3d 67, 71 (2d Cir. 1998). However, “[w]hile the pleading standard is a liberal one, bald assertions and conclusions of law will not suffice.” Leeds v. Meltz, 85 F.3d 51, 53 (2d Cir. 1996) (citing cases). A plaintiff must allege sufficient facts to support a cause of action, and the Court “cannot read into [a] complaint the missing allegations crucial to [plaintiff’s] claim . . . .” Hack v. President and

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Fellows of Yale College. 237 F.3d 81, 91 (2d Cir. 2000). Likewise, the Court should not assume facts that the plaintiff has not alleged “or that the defendants have violated the antitrust laws in ways that have not been alleged.” Associated Gen. Contractors of California. Inc. v. California State Council of Carpenters, 459 U.S. 519, 526 (1983).

A case is properly dismissed for lack of subject matter jurisdiction under Rule 12 (b) (1) when the district court lacks the statutory or constitutional power to adjudicate it. See Fed. R. Civ. P. 12 (b) (1). “In resolving a motion to dismiss for lack of subject matter jurisdiction under Rule 12 (b) (1), a district court may refer to evidence outside the pleadings.” Makarova v. United States. 201 F.3d 110, 113 (2d Cir. 2000). A plaintiff asserting subject matter jurisdiction has the burden of proving by a preponderance of the evidence that it exists. See id.

The AG’s federal claim under section 7 of the Clayton Act must be dismissed:

A. Pursuant to Rule 12 (b) (1), because the AG does not have standing as parens patriae;

B. Pursuant to Rule 12 (b) (6), because the AG’s proprietary claim fails for lack of a sufficient allegation of antitrust injury to Connecticut; and

C. Pursuant to Rule 12 (b) (1), because the AG is not a proper party as he has no statutory authority to bring this claim under § 7 of the Clayton Act.

A. Parens Patriae is a Limited Exception to General Standing Analysis Applied to Private Plaintiffs

Parens patriae standing allows a state to vindicate quasi-sovereign interests in the welfare of substantial portions of its population that would otherwise go unprotected. Because it is an exception to the general rules of standing applied to private plaintiffs, courts narrowly construe the doctrine and limit it to cases in which it is truly needed, for example, to stop pollution of the state’s environment—a harm that affects the population at large, yet does not necessarily

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specifically injure any individual—or to prevent invidious discrimination against residents of a state who lack a sufficient individual stake to shoulder the cost and difficulty of suing.

The contrast with this action is stark. Rather than a diffuse class of consumers or disadvantaged citizens, the AG seeks to represent the interests of a definite class of extremely large companies that are capable of protecting their own interests in either the marketplace or the courts. Ordinary standing principles, discussed in part 1 below, require that this action be dismissed so that the proper parties—those purportedly threatened with injury—can bring an action if they so choose. Here, that conclusion is bolstered by Congressional direction, discussed in part 2 below, that in antitrust cases parens patriae standing should be used to bring enforcement actions on behalf of individual consumers, not businesses.

1. The AG Lacks Standing as Parens Patriae

States, of course, may bring federal antitrust claims as parens patriae where the generally applicable standards of parens patriae standing have been met. For example, Georgia was allowed to seek an injunction against a conspiracy to charge discriminatory shipping rates “the gravamen of which runs far beyond the claim of damage to individual shippers” and which “if proven limits the opportunities of her people, shackles her industries, retards her development, and relegates her to an inferior economic position among her sister states.” Georgia v. Pennsylvania R.R., 324 U.S. 439, 451-52 (1945). More recently, states have obtained injunctive relief in merger cases, including divestiture of businesses, to prevent widespread injuries to their residents in general. E.g., California v. American Stores, 495 U.S. 271 (1990) (holding that California could seek divestiture following supermarket merger that reduced competition in several intrastate geographic markets for retail groceries, affecting a diffuse group of

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customers).⁵ Such antitrust enforcement actions fit neatly within the tradition of parens patriae remedies for harms to the general public, such as pollution, e.g., New York v. New Jersey, 256 U.S. 296 (1921) (holding that New York could sue to enjoin the discharge of sewage into New York harbor); activity hampering the general economy of the state, e.g., Pennsylvania v. West Virginia, 262 U.S. 553 (1923) (holding that Pennsylvania and Ohio could sue to enjoin restraints on the flow of natural gas that “imperil the health and comfort of thousands of their people”); and, more recently, ethnic and other invidious forms of discrimination, e.g., Alfred L. Snapp & Son, Inc. v. Puerto Rico. 458 U.S. 592 (1982) (employment discrimination against Puerto Ricans).

Thus, parens patriae actions are appropriate “to challenge allegedly illegal business activities on behalf of a group of citizen consumers as a statewide ‘class’ of sorts—a group whose members may lack sufficient economic stake to justify bringing suit as individuals or who may have insufficient incentive, or may otherwise be unable to meet the criteria, to sue as a Rule 23 class.” Laurence Tribe, American Constitutional Law. § 3-20 , p. 454 (3d Ed. Foundation Press 2000). However, as the First Circuit recently explained, parens patriae standing is a judicially created “exception to normal rules of standing applied to private citizens in recognition of the special role that a State plays in pursuing its quasi-sovereign interests in the well-being of its populace . . . that has been narrowly construed.” Estados Unidos Mexicanos v. Decoster, 229 F.3d 332, 335 (1st Cir. 2000) (internal quotation marks omitted.) Where a complaint fails to

⁵ In another antitrust decision, the Fourth Circuit affirmed a district court ruling that recognized standing in the Attorney General of Maryland where the complaint alleged that certain illegal restraints imposed on the distribution of replacement tires for automobiles “artificially inflate[d] the price of Goodyear tires” and “[t]he artificially inflated prices are absorbed by the citizens of Maryland, the ultimate purchasers of the tires, all to the detriment of those citizens and the general economy of the State of Maryland.” Burch v. Goodyear Tire & Rubber Co., 420 F. Supp. 82, 85 (D. Md. 1976), aff’d, 554 F.2d 633 (4th Cir. 1977) (internal quotation marks omitted).

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allege a proper quasi-sovereign interest, it must be dismissed. See, e.g., Connecticut v. Physicians Health Servs., Inc., 103 F. Supp. 2d 495, 507 (D. Conn. 2000).

In its most recent and thorough discussion of this issue in Alfred L. Snapp & Son. Inc. v. Puerto Rico. 458 U.S. 592 (1982), the Supreme Court reviewed its parens patriae decisions to derive the outer limits on state standing to bring federal claims against private parties. Puerto Rico sued Virginia apple producers under federal labor statutes for discriminating against qualified Puerto Rican farmworkers in favor of foreign workers. The Court agreed with the Fourth Circuit that Puerto Rico had standing because its complaint described a “quasi-sovereign” interest “that the state has in the well-being of its populace,” 485 U.S. at 602, and its claims fell within the two traditional categories of parens patriae actions. After surveying its cases, the Court stated: “the State must articulate an interest apart from the interests of particular private parties, i.e., the State must be more than a nominal party.” 485 U.S. at 607. The Court also discerned two general categories of interests that support standing: “First, a State has a quasi-sovereign interest in the health and well-being—both physical and economic—of its residents in general. Second, a State has a quasi-sovereign interest in not being discriminatorily denied its rightful status within the federal system.” Id. (emphasis added). Applying this analysis to Puerto Rico’s claims, the Court found that Puerto Rico had standing to protect its residents from discrimination and “agree[d] with the Court of Appeals that ‘[deliberate] efforts to stigmatize the labor force as inferior carry a universal sting,’” 485 U.S. at 609, extending well beyond the limited economic effects of the particular instances of discrimination alleged by the complaint. As explained below, the AG’s invocation of parens patriae here is inconsistent with Snapp and cases interpreting it in this Circuit.

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This Circuit applies a three-part test to determine the limits of state standing to bring suit as parens patriae: “First, the State must articulate ‘a quasi-sovereign interest’—that is an interest that is distinguishable from the interests of private parties. Second, the state must ‘allege[] injury to a substantial segment of the population.’ And, third the reviewing court must find that ‘individuals could not obtain complete relief through a private suit.’” New York ex rel. Spitzer v. Wallkill, 2001 U.S. Dist. LEXIS 13364, at *7 (S.D.N.Y 2001) (citations omitted) (summarizing and quoting Abrams v. 11 Cornwell Co., 695 F.2d 34 (2d Cir. 1982), vacated in part on other grounds, 718 F.2d 22 (2d Cir. 1983)). Applying this test, the AG lacks parens patriae standing to bring suit on behalf of the tiny class of large “enterprises” defined in the Amended Complaint.

a. The Amended Complaint does not Describe a Distinct “quasi-sovereign interest”

Parens patriae standing requires a state to allege and prove a distinct quasi-sovereign interest apart from the individual interests advanced by the lawsuit. For instance, in the seminal case of Abrams v. 11 Cornwell Co 695 F.2d 34 (2d Cir. 1982), the Second Circuit upheld New York’s authority to seek an injunction under a federal civil rights statute against a neighborhood partnership formed for the purpose of preventing a local building from being used as a residency for mentally impaired adults. The appeals court quoted with approval the district court’s observation that “representation of mentally disabled persons is the paradigm case for parens patriae standing,” 695 F.2d at 38, and found that a quasi-sovereign interest was implicated because (1) successful opposition to such facilities would “deprive any number of retarded persons of the opportunity to receive rehabilitation;” (2) “[p]reventing a residential facility also requires the State to bear the cost of keeping more people in institutions” thus requiring “the people already there . . . to live in more crowded surrounding;” (3) and “retarded persons and

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community residents are deprived of being able to live in integrated communities.” Id. at 39. Relying on Snapp, the Second Circuit found that beyond the direct economic effects “there is a similar state interest in securing residents from the harmful effects of discrimination.” Id. “The State of New York has in our view no less an interest in seeing to it that its mentally retarded obtain equal protection under the housing laws than Puerto Rico has in seeing that its citizens obtain equal employment opportunities.” Id.

By comparison, where the interests advanced by the lawsuit are not a proxy for a more general public concern, courts uniformly deny parens patriae standing, For example, when Illinois sued Mid-America for using misleading printed materials to induce “eight elderly rural consumers to invest in ‘ultimate estate liquidity programs,’” the Seventh Circuit denied the state parens patriae standing to assert a RICO claim for failure to allege a quasi-sovereign interest. Illinois v. Life of Mid-America Ins. Co 805 F.2d 763, 764, 766 (7th Cir. 1986). Because Illinois’ claim implicated only the economic loss of the defrauded individuals, “the Attorney General . . . is merely a nominal party in this suit to recover for injury to eight consumers, and as such, has no parens patriae standing.” Id. at 766.

In another case with parallels to the present action, Land O’ Lakes Creameries v. Louisiana State Bd. of Health, 160 F. Supp. 387 (E.D. La. 1958), several manufacturers of dried milk sued to overturn Louisiana milk labeling rules. The Attorney General of Minnesota sought leave to intervene as parens patriae on behalf of all Minnesota dried milk producers. Taking judicial notice that the dairy industry was not the only or even largest industry in Minnesota and that dried milk production comprised but a small part of that industry, the court concluded:

The dairy industry statistics offered by Minnesota fail to demonstrate that the sale of dried milk is of such pervasive importance to that industry and to Minnesota citizens generally that restrictions on the interstate distribution of dried milk would directly and materially affect the “welfare of the people of Minnesota.” Thus the interests of the

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single industry here involved must be held to be private interests, not interests affecting the whole economy or all the people of the state. This type of interest is insufficient to give Minnesota the right to sue as parens patriae in behalf of all, or a substantial number, of her citizens.

Id at 389. Thus, in Pennsylvania v. Kleppe, 533 F.2d 668, 675 (D.C. Cir. 1976), the D.C. Circuit observed that it is “well established that there can be no standing in the state where the primary thrust of an alleged wrong is injury to a narrowly limited class of individuals, and the harm to the economy as a whole is insignificant by comparison.”

In the present case, because the Amended Complaint alleges harm only to a “narrowly limited class” of “enterprises,” and because the allegations cannot be construed to even suggest any harm to Connecticut consumers, any harm to the state’s economy is “insignificant by comparison” and, therefore, the AG has not pled a distinct quasi-sovereign interest. As in Land O’ Lakes and Mid-America, the Amended Complaint fails to implicate the well-being of Connecticut’s residents in general and must be dismissed. Cf. Snapp, 458 U.S. at 609.

b. The Amended Complaint Fails to Allege “an injury to a substantial segment” of the Population of Connecticut

Even if this Court were to find a quasi-sovereign interest, the AG’s assertion of parens patriae standing must be rejected because it cannot survive the next two prongs of the Cornwell analysis. Cornwell found that, despite the small number of mentally impaired individuals directly involved, New York’s lawsuit met “the substantial segment of the population” prong of the standing test, because “an unspecified number of ‘similar [mentally impaired] people in years to come, . . . other individuals in mental institutions, and the members of the [Long Island] community itself’ all would be affected by the outcome of the case.” New York ex rel. Spitzer v. Wallkill, 2001 U.S. Dist. LEXIS 13364 at *15 (quoting Cornwell. 695 F.2d at 39 n.10). While there is no numerical threshold, “what must be shown is a clear indication that the State is acting

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on behalf of a broad spectrum of the public.” Id. at *14-15.

Thus, where suit is brought as a “test case” on behalf of “exemplars” to halt ongoing illegal conduct affecting a much larger group of citizens, the requirement may be met. As in Snapp and Cornwell, decisions allowing parens patriae standing on behalf of a few named individuals invariably concern continuous conduct threatening an undefined—indeed, unknowable—large group of individuals in the future. E.g., New York v. Peter & John’s Pump House. 914 F. Supp. 809, 812 (N.D.N.Y 1996) (discrimination against African-Americans); New York v. Mid-Hudson Med. Group, 877 F. Supp. 143, 147 (S.D.N.Y. 1995) (deaf individual was a “test case” for all deaf New Yorkers); Support Ministries v. Waterford, 799 F. Supp. 272, 278 (N.D.N.Y. 1992) (discrimination against people with HIV/AIDs). In such cases, the “substantial segment of the population” requirement is met by the significant number of still-unidentifiable individuals who would be harmed if the illegal conduct were allowed to continue unchecked.

By contrast, we know today the identity of all the “enterprises” that would be harmed if the allegations of the Amended Complaint were true. In fact, its failure to meet “the substantial segment of the population” requirement is far more certain than in New York v. Holiday Inns, Inc 656 F. Supp. 675, 678-79 (W.D.N.Y. 1984), which denied New York parens patriae standing to join ten individual plaintiffs’ age and gender employment discrimination claims against Holiday Inns because the state “failed to allege an injury to a substantial segment of New York’s population.” Id. at 677. Although the Holiday Inns complaint alleged age discrimination that was superficially similar to the discrimination claims in Cornwell and other cases, the court did not read the complaint as a “test case” brought for the benefit of a larger group, including future employees. Thus, the New York Attorney General impermissibly sought to act as a “nominal party” representing individual interests. Id. The same conclusion is unavoidably true

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as to the AG here: because the Amended Complaint fails to allege an injury to a substantial segment of the population of Connecticut, the AG does not have standing as parens patriae and his Amended Complaint should be dismissed.

c. “Enterprises” are Able to Obtain Identical Relief

The Amended Complaint obviously flunks the last prong of the Cornwell analysis, namely, that “[p]arens patriae standing also requires a finding that individuals could not obtain complete relief through a private suit.” 695 F.2d at 40. This requirement follows from “the Supreme Court’s statement that a state acting merely as a nominal party has no parens patriae standing. In other words, if the state has no quasi-sovereign interest apart from the interests of private individuals, who can obtain complete relief through their own litigation, then no parens patriae standing exists.” Peter & John’s Pump House. 914 F. Supp. at 812 n.3 (citing Snapp, 458 U.S. at 600). In a pre-Snapp decision, the Second Circuit described this prong of the analysis as requiring a court to consider “the presence or absence of a more appropriate party or parties capable of bringing suit.” Puerto Rico v. Bramkamp, 654 F.2d 212, 217 (2d Cir. 1981) (quoting Kleppe, 533 F.2d at 675). As the D.C. Circuit explained, “[p]arens patriae standing appears to be most justified in those instances where undeniable harm has been done, but for some reason the individual injuries are not legally recognizable. . . . The arguments in favor of allowing such standing become less compelling as it becomes more feasible to achieve complete relief through suits by the private parties actually aggrieved.” Kleppe, 533 F.2d at 675.

Thus, where “the ten named plaintiffs possess the requisite standing to challenge the alleged discriminating practices and to receive complete relief through their private suit,” the Holiday Inns court found that “the State is merely a nominal party in this action and lacks parens patriae standing.” New York v. Holiday Inns. 656 F. Supp. at 677-78 (granting motion to

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dismiss “Attorney General’s causes of action”); see also New York v. Conciliation and Appeals Bd., 123 Misc. 2d 47, 49-50 (N.Y. 1984) (“the Attorney-General may not maintain this action as parens patriae” because “the relief sought in the petition, viz., the allowance of rent reductions to tenants in buildings where the [New York City Conciliation and Appeals Board] has found a diminution of services, was fully available to the tenants”) (citing Bramkamp). By comparison, the district court declined to dismiss claims brought by the New York Attorney General where a private plaintiff was a “not-for-profit corporation which apparently has limited resources” and might “decide to ‘cut their losses’ by compromising their claim for injunctive relief in the interest in obtaining a monetary settlement.” Support Ministries. 799 F. Supp. at 278. Similarly, in Bramkamp, a case based on essentially the same facts as Snapp, the Second Circuit found Puerto Rico to be a proper plaintiff because “there was no assurance that individual [migrant farm] workers could bear the cost of a lawsuit that would bring complete relief.” 654 F.2d at 217.

By the AG’s own definition of the relevant market, large “enterprises” with multi-billion dollar annual revenues ipso facto have the financial resources and sophistication to look out for themselves in both the courts and the marketplace. In fact, it is hard to imagine a case farther outside the tradition of parens patriae, or a clearer misuse of its authority, than a suit by a state attorney general—funded, of course, by general tax revenues—on behalf of such “enterprises.”

Complete relief is clearly available under the law. Section 16 of the Clayton Act authorizes, inter alia, directly injured parties to seek injunctive relief against a merger of two suppliers in violation of the antitrust laws. Large sophisticated entities have often sought and obtained injunctions. See e.g AlliedSignal, Inc., v. B.F. Goodrich Co., 183 F.3d 568 (7th Cir. 1999) (affirming preliminary injunction obtained by a purchaser of landing gear prohibiting a

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merger of two such suppliers after the Federal Trade Commission approved the transaction). Moreover, injunctions are just as likely to be pursued in a private enforcement action as one initiated by a state. Any “enterprise” that believes it would be harmed by the merger proposed in Oracle’s Tender Offer could protect itself only by seeking complete injunctive relief, the same remedy sought by the AG. Because those sophisticated “enterprises” can obtain complete relief through their own litigation, no parens patriae standing exists.

2. Other Policy Considerations Militate Against Recognizing Parens Patriae Standing

The D.C. Circuit explained that in parens patriae cases “the sufficiency of the injury actually alleged is highly contingent upon other relevant factors bearing on the appropriateness of letting the plaintiff state pursue the case on the merits.” Kleppe, 533 F.2d at 674-75. Reflecting the prudential nature of the inquiry, the D.C. Circuit elaborated: “if other circumstances of the action suggest important arguments for denying state standing, analysis may indicate that standing should be denied even if the interest represented seems superficially similar to that held an adequate basis for standing in [another action].” Id. at 676; see also Holiday Inns. 656 F. Supp. 2d at 677-78. Likewise, parens patriae does not “eliminate[] or adequately substitute[] for proximate cause. Rather, the doctrine of parens patriae is merely a species of prudential standing, and does not create a boundless opportunity for governments to seek recovery for alleged wrongs against them or their residents.” SEIU v. Philip Morris, Inc., 249 F.3d 1068, 1073 (D.C. Cir. 2001), cert. denied, 534 U.S. 994 (2001). Here, the vague and speculative concerns about a possible remote harm to the economy, untethered by meaningful facts and analysis, does not make the AG’s foray into this tender offer contest a proper parens patriae action.

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Moreover, Congress has confirmed that parens patriae actions by state attorneys general are appropriate to protect individual consumers rather than businesses. When amending the Clayton Act in 1976 to allow states limited authority to recover damages on behalf of their residents, Congress authorized parens patriae action only “on behalf of natural persons residing in such state” and expressly excluded recovery for damages “which [are] properly allocable to any business entity.” 15 U.S.C. 15c (a) (1) (B) (ii) (emphasis supplied).⁶ Although the 1976 amendments concern suits for damages, Congress’ most recent and clearly stated intention to disqualify business entities from serving as the basis for parens patriae suits should inform the scope of injunctive relief under § 16 of the Clayton Act as well. This congressional action is consistent with judicial interpretations, and confirms that the parens patriae exception to the general standing requirements that private antitrust plaintiffs must meet has a limited scope.

3. Conclusion

This is an exceptional case because the AG’s suit on behalf of large “enterprises” so wildly exceeds the limits imposed by parens patriae doctrine. The traditional analysis requires the court to ask whether there are other parties better situated to enforce the law without risk of

⁶ The report of the House Judiciary Committee that accompanied the bill clearly staled that Congress believed that individual consumers needed state representation, but businesses could “fend for themselves:”

The subcommittee and the full committee gave extended consideration to the proper scope of the remedy. . . . [The subcommittee]. . . concluded that “persons” was too broad a term [to describe on whose behalf an attorney general could sue] as it might be construed to include business entities, which are able, in general, to fend for themselves. . . .

The committee chose “natural persons” as the best expression of the goals of the legislation. The term is intended to exclude business entities such as corporations, partnerships, and sole proprietorships. While some “natural persons” might be in a position to bring their own actions and some business entities might not, the committee concluded that these instances will be rare and that use of the phrase “natural persons” will permit actions on behalf of those most in need of representation but presently unrepresented.

H.R. Rep. No. 94-499, at 9-10 (1975). Notably, Congress was so concerned about the risk of overly expanding the availability of parens patriae suits that it chose to exclude even sole proprietorships or other business entities possibly incapable of representing themselves; clearly, the use of the parens patriae power to protect the interests of the massive “enterprises” described by the Amended Complaint runs contrary to the Congressional understanding of the role of a parens patriae.

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misjudgment or overreaching that would harm those most concerned. Here, the answer to that inquiry is that, unequivocally, such directly affected parties do exist and can be expected to redress any potential violation. While states have a long-recognized right to protect their citizens in general from pervasive harms, they “cannot by creating an agency for the purpose of making life better in the state obtain a legal interest in every transaction to which an entity within the state is a party. Such an agency would be no different from the kind of do-good or trade association routinely denied standing despite claiming a ‘special interest’ in the private litigation of others.” Hinson, 122 F.3d at 373. With this precipitous antitrust action, the AG seeks to cast itself as exactly such an officious intermeddler in the contest for corporate control now playing out between Oracle, PeopleSoft, and its shareholders. Because others, including large corporations and the DOJ, can and would advance any bona fide antitrust concerns, this Court should block the AG’s wholly inappropriate attempt to assume that role. Since no parens patriae standing exists, the Amended Complaint must be dismissed.

B. The AG Cannot Bring this Suit to Protect Connecticut’s Proprietary Interests Because the Amended Complaint Fails to Allege that Connecticut is Threatened with Antitrust Injury

Perhaps having recognized the precariousness of his standing as a parens patriae, the AG amended his first complaint and now seeks to also bring this action in Connecticut’s “proprietary capacity” as a current licensee of PeopleSoft software. (Amended Compl. 2.)   However, it is clear from the pleadings that the new claim is fatally flawed because it fails to allege antitrust injury to Connecticut, an essential element of the AG’s proprietary cause of action.

Specifically, the AG’s failure to allege that Connecticut is a future purchaser⁷ in any relevant market that would be likely to suffer from reduced competition further confirms that the

⁷ This is a purposeful omission as Connecticut recently entered a long-term contract following a competitive bidding process. See “Core-CT Project Fact Sheet,” (last viewed on August 16, 2003) <www.core-ct.state.us.fact_sheet>.

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AG is not the appropriate party to bring this lawsuit. In lieu of such an allegation, the Amended Complaint alleges that Connecticut will suffer the expense and inconvenience of ameliorating potential degradation or obsolescence of its existing PeopleSoft products. (Amended Compl. 3, 33.) Although this allegation is contradicted by numerous public commitments by Oracle to continue support for PeopleSoft’s applications and is entirely speculative, even assuming that there is a factual basis for the AG’s apprehension, the Amended Complaint fails to state a valid claim for relief. As explained below, such costs cannot as a matter of law be antitrust injury because they are not caused by any reduction in competition that the antitrust laws are intended to prevent, but rather could occur as a result of any acquisition of PeopleSoft, whether by Oracle or others, or even if PeopleSoft were never acquired.

1. Antitrust Injury

In an antitrust case, a private plaintiff does not establish standing merely by demonstrating that it was injured by conduct allegedly violating the antitrust laws. In addition to an allegation of a proximate causal connection between the purported violation and the claimed injury, the Supreme Court has established a separate pleading requirement—that of “antitrust injury.” In order to seek injunctive relief under § 16, a private plaintiff must allege threatened loss or damage that both (1) “flows from that which makes defendants’ acts unlawful” and (2) is “of the type the antitrust laws were designed to prevent.” Cargill, Inc. v. Monfort. Inc., 479 U.S. 104, 113 (1986) (quoting Brunswick Corp. v. Pueblo Bowl-0-Mat. Inc 429 U.S. 477, 489 (1976)). Here, because Connecticut’s alleged injuries have nothing to do with the increase in market concentration it alleges will result from the merger, the Amended Complaint fails both prongs of the Supreme Court’s test.

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2. Connecticut is not Threatened with Antitrust Injury because It Already Purchased Its Software

It is axiomatic that, to have standing to bring a claim for injunctive relief under § 16 of the Clayton Act, “a private litigant . . . must prove ‘threatened loss or damage’ to his own interests in order to obtain relief.” California v. American Stores Co., 495 U.S. 271, 296 (1990) (quoting Cargill, 479 U.S. 104); accord Garabet v. Autonomous Tech. Corp., 116 F. Supp. 2d 1159, 1170 (C.D. Cal. 2000) (under § 16 “a plaintiff must still demonstrate that injunctive relief is necessary to prevent injury to its interests rather than those of others”).

Here, because Connecticut has already licensed its software, the Amended Complaint does not allege that Connecticut is a future purchaser that would be likely to suffer from any overall reduction of competition in a relevant market. As a result, the AG cannot demonstrate a “threatened injury.” See Garabet, 116 F. Supp. 2d at 1171 (no antitrust injury because plaintiffs had “no intention of purchasing from [the] Defendants” and further had no “plan to purchase [relevant products] from any member of this market in the foreseeable future”). As the court in Glen Holly Entm’t v. Tektronix, Inc., 100 F. Supp. 2d 1073 (C.D. Cal. 1999), reasoned: “[T]o have standing in the purchase market, [p]laintiff must allege that it is actually a purchaser in that market. In other words, [p]laintiff must allege that it will pay higher prices or purchase less capable machines as a result of the anti-competitive behavior of the [d]efendants.” Id. at 1079 (dismissing complaint that did not allege plaintiff “intends to make new purchases”); cf. In re Mercedes-Benz Antitrust Litig., 213 F.R.D. 180, 186 (D.N.J. 2003) (denying past customers class certification to seek an injunction against a conspiracy allegedly raising the cost of Mercedes cars because “there is nothing to suggest that class members will buy more automobiles from the defendants in the future”).

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Thus, because it does not view itself as a potential purchaser of enterprise software, Connecticut is not threatened by the increase in concentration in the purported markets that it alleges constitutes the harm to competition, and, therefore, the AG has failed to demonstrate an antitrust injury.

3. The Alleged Harm to Connecticut Does not “Flow From” the Anticompetitive Effects Alleged in the Amended Complaint and is Not of the Type of Injury the Antitrust Laws were Designed to Prevent

Instead of alleging that Connecticut actually will be harmed by a purchase of a relevant product at an artificially increased price or of an artificially less innovative product, the Amended Complaint alleges that Connecticut will suffer the expense and inconvenience of ameliorating the impact if at some point in the future, the state’s existing PeopleSoft products become degraded or obsolete. (Amended Compl. 3.) Such costs, however, are not antitrust injury.

First, the AG’s argument has already been considered and squarely rejected. In Glen Holly, the plaintiff was a purchaser of a type of digital editing equipment that was discontinued following a merger of two manufacturers of such equipment. The plaintiff argued that “because it is locked into a particular product line, it suffers when the product line is discontinued.” 100 F. Supp. 2d at 1083. The court rejected this argument:

[T]he Court has found no suggestion that the antitrust laws seek to protect consumers against the lack of support or the expense involved in a product-transition. . . .

Put another way, the Court concludes that the antitrust laws do not protect consumers against the diminution in value of their current inventory, even when they are locked-into that inventory and will incur expenses in transition.

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Id. Glen Holly’s reasoning applies here. The claim that Connecticut will suffer a “lack of support or the expense involved in a product-transition” simply has nothing to do with any alleged anticompetitive effect in the overall market. Thus, such expenses are not an antitrust injury.

Likewise, the obsolescence of an already-purchased product is not antitrust injury because it does not flow from that which allegedly makes the acquisition unlawful. “The antitrust laws are designed to ensure competition, so as to lower prices and to maximize quality and features at a given price. . . . Nothing about the antitrust laws, however, is designed to insure that a plaintiff’s inventory remains current.” Glen Holly, 100 F. Supp. 2d at 1082-83. The AG’s claim here is that the acquisition may result in Connecticut’s PeopleSoft software becoming obsolete. But, “the ‘stigma of obsolescence’ is not the sort of harm against which the antitrust laws were designed to prevent.” Id. at 1083-84. Such claims are best left in the realm of contract law; in fact, it is Oracle’s understanding that Connecticut has a license with PeopleSoft that gives it certain rights to have its products maintained and supported, and Oracle, or any other acquirer, would assume those obligations as part of any acquisition of PeopleSoft.

Second, the defects in the AG’s proprietary claim are similar to those identified by the seminal Brunswick decision. Brunswick was a large manufacturer of bowling equipment that had acquired several bowling alleys. The plaintiff, which operated bowling alleys that competed against alleys acquired by Brunswick, claimed Brunswick’s acquisitions violated Section 7 of the Clayton Act “because they brought a ‘deep pocket’ parent into a market of ‘pygmies.’” 429 U.S. at 487. Reasoning that but-for the illegal acquisitions, the acquired alleys would have gone out of business, the plaintiff alleged injury and damages resulting from the lost profits that would have accrued in a less competitive market. The Court concluded that the plaintiff had no

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standing as it “would have suffered the identical ‘loss’—but no compensable injury—had the acquired [alleys] instead obtained refinancing or been purchased by ‘shallow pocket’ parents.” Id.

Here, as in Brunswick, the same harm would occur if any acquirer, or even PeopleSoft itself, decided to introduce a next-generation product and reduce or discontinue support for the legacy product. Indeed, the situation is identical to the situation in Brunswick, in which the Court reasoned that: “Every merger of two existing entities into one, whether lawful or unlawful, has the potential for producing economic readjustments that adversely affect some persons.” 429 U.S. at 487. Thus, even if the alleged losses here could be causally connected to an allegedly anticompetitive merger, as in Brunswick, such an injury is “not of the type [Section 7] was intended to forestall.” Id. at 487-88 (internal quotation marks omitted). Accord Alberta Gas Chemicals Ltd. v. E.I. du Pont de Nemours & Co., 826 F.2d 1235, 1242 (3d Cir. 1987) (plaintiff’s injury did not flow from anticompetitive conduct because “the same harm would have occurred had any acquirer decided to curtail [target company’s] production and marketing plans”); G.K.A. Beverage Corp. v. Honickman, 55 F.3d 762, 767 (2d Cir. 1995) (Winter, J.).

Indeed, if PeopleSoft itself were to introduce a new product and discontinue its old product so as to migrate its customers to the new version,⁸ Connecticut would suffer the very same expenses as the old product became obsolete. Because the alleged harm could occur even if another firm acquired PeopleSoft, or even if no one acquires PeopleSoft, it cannot be antitrust injury. Brunswick, 429 U.S. at 487.

Finally, the AG’s unfounded and speculative apprehension concerning the consolidation of product lines, even if true, would not constitute antitrust injury. Go-Video. Inc. v. Matsushita

⁸ In fact, PeopleSoft has recently done exactly that, announcing that as of December 2003 it will discontinue support for its PeopleSoft 7 line of products and only offer its incompatible PeopleSoft 8 line of products.

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Elec. Indus. Co 1992 U.S. Dist. LEXIS 16539, at *25, 1992-2 Trade Cas. (CCH) 69,972 (D. Ariz. Sept. 15, 1992) (complaint failed to rebut presumption that no antitrust injury arises from consolidation of two software products), aff’d, 15 F.3d 1085 (9th Cir. 1994) (mem.). Antitrust injury cannot arise from efficient conduct because it would be inconsistent with the underlying purpose of the antitrust laws. See, e.g., Brunswick. 429 U.S. at 487-88; Florida Seed Co. v. Monsanto, 105 F.3d 1372, 1375 n.3 (11th Cir. 1997); Fischer v. NWA, Inc., 883 F.2d 594, 600 (8th Cir. 1989). In Brunswick, for example, the claimed injury was inconsistent with the underlying purpose of the antitrust laws because it resulted from conduct that actually enhanced competition. For that reason, the Supreme Court held that it did not constitute antitrust injury. 429 U.S. at 487-88.

The consolidation of two similar product lines would bring pro-competitive effects -namely, the elimination of the duplicative costs of having two products, savings that would accrue to the benefit of customers in the form of lower prices. Cf. Fischer v. NWA. Inc., 883 F.2d at 600 (no antitrust injury because termination of regional carrier “was caused by Northwest’s need to avoid employing two regional airlines where only one was required”). Thus, although “[e]very merger . . ., whether lawful or unlawful, has the potential for producing economic readjustments that adversely affect some persons,” Brunswick, 429 U.S. at 487, such an adverse effect itself provides no basis for a disgruntled customer to challenge a merger.

The AG first sought to enjoin Oracle from acquiring PeopleSoft on the basis of vague allegations of harm to a class of large enterprises in which Connecticut has no economic or legal interest. In retreating from that untenable initial position, the AG alleged a proprietary interest in avoiding costs of maintaining Connecticut’s already purchased PeopleSoft products. But, under Brunswick such costs are not antitrust injury because they bear no relationship with the antitrust

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laws’ underlying purpose of protecting competition. Since no antitrust injury has been alleged, the Amended Complaint must be dismissed.

C. The AG Lacks Authority Under State Law to Bring this Federal Claim

Separate from the antitrust standing principles discussed above, the AG is without authority under state law to maintain this action for injunctive relief under § 7 of the Clayton Act. The AG’s authority is derived solely from statute, and when the AG acts without statutory authority, he does not have standing. See Blumenthal v. Barnes. 261 Conn. 434, 463 (2002). In the Amended Complaint, the AG alleges that “[t]he Attorney General of the State of Connecticut is the chief civil law enforcement officer of the State, and as such is authorized to bring this suit on behalf of the State and its general economy.” (Amended Compl. 3.) Specifically, the AG claims to have authority to bring this Clayton Act claim under Connecticut General Statutes §§ 35-32 (parens patriae capacity), 35-34 (injunctive relief for violations of Connecticut Antitrust Act)⁹ and 35-44a (proprietary capacity) (Amended Compl. 2.) On the contrary, as a matter of law, the AG has no authority to bring an action solely for injunctive relief under Section 7 of the Clayton Act in federal court. Because the AG is acting beyond the limits of the authority granted by the Connecticut General Assembly, he is without capacity and has no standing to bring this action. The Amended Complaint therefore should be dismissed pursuant to Fed . R. Civ. P. 12 (b)(l).

In Moore v. Mitchell. 281 U.S. 18 (1930), the United States Supreme Court established that, where public officials are without authority in their official capacity to bring an action, the action must be dismissed. Furthermore, a question regarding a public official’s authority to

⁹ General Statutes § 35-34 permits consumers to pursue injunctive relief only for violations of the Connecticut Antitrust Act, not federal antitrust law. Id. (“The state . . . may sue for injunctive relief . . . against threatened loss or damage to its property or business by any violation of this chapter.”) (emphasis added). That section therefore is appropriately discussed in the section of this memorandum that addresses the AG’s claims under the state act.

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institute an action implicates that official’s standing. See id. at 24 (the public officer “is a mere arm of the State . . . and has no standing to bring suits in courts outside Indiana . . . .”); Baxley v. Rutland, 409 F. Supp. 1249, 1253-57 (M.D. Ala. 1976). The AG is such a public official, and his capacity to bring the instant action is governed by Connecticut state law. See, e.g., Baxley v. Rutland, 409 F. Supp. at 1254 (“[t]he extent of the powers conferred on the Attorney General of Alabama by the state constitution and statutes can be adjudged with final authority only by the Supreme Court of Alabama”); Philadelphia Housing Authority v. American Radiator & Stand. Sanitary Corp., 309 F. Supp. 1057 (E.D. Pa 1969) (the right of the Pennsylvania Attorney General to sue in “parens patriae” capacity is governed by state law); Fed. R. Civ. P. 17 (b) (“capacity to sue or be sued shall be determined by the law of the state in which the district court is held”).

Under Connecticut state law, the AG’s authority is derived solely from statute. See Blumenthal v. Barnes, 261 Conn. 434, 463 (2002). In Blumenthal v. Barnes, the AG argued that he had common law authority to maintain the action in that case. The Connecticut Supreme Court rejected that argument, concluding that “the office of the attorney general is a creature of statute that is governed by statute and, thus, has no common-law authority.” Id. (internal quotation marks omitted). The court further concluded that the AG had no standing to pursue his action to the extent that he relied upon non-statutory authority. Id. (“we conclude that . . . the attorney general is without standing to pursue an action against the defendant . . . .”). Finally, the court noted that the “enumeration of [the Attorney General’s] powers in a statute is uniformly held to forbid things not enumerated.” Id Thus, not only is the AG strictly limited to the authority provided in the Connecticut General Statutes, but the very act of specifying the AG’s

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powers preempts all other official acts. If the AG acts without statutory authority, he does not have standing. Id.

As for the statutory authority to bring this action, only two sections in the Connecticut Antitrust Act (the “Act”), Conn. Gen. Stat. §§ 35-24 to 35-46, permit the AG to bring an action under federal antitrust law on behalf of the state in federal court. The first of these, Connecticut General Statutes § 35-44a, provides in relevant part: “The Attorney General may institute proceedings on behalf of the state . . . in federal court to recover damages or to seek injunctive relief provided for under any provision of federal law comparable to the provisions of this chapter . . . .” (emphasis added).¹⁰ It was enacted in 1975 as P.A. 75-508 and became effective on July 1 of that year.

By its terms, the grant of authority under § 35-44a applies only to actions brought under federal law that are “comparable to the provisions” of the Act. Although there are several such provisions, e.g C.G.S. § 35-26 (comparable to § 1 of the Sherman Act); § 35-27 (comparable to § 2 of the Sherman Act); C.G.S. § 35-45 (comparable to the Robinson-Patman Act), the Act does not contain a comparable provision to Section 7 of the Clayton Act, the federal provision invoked here. (Amended Compl. 36.) See George D. Brodigan, Connecticut Anti-trust Act, 47 Conn. B.J. 12, 17-18 (1973) (no state analogue to § 7 of the Clayton Act). The AG therefore cannot rely on § 35-44a in his bid to block Oracle’s Tender Offer under the Clayton Act.

¹⁰ It is unclear whether, even if § 35-44a is applicable, it provides authority to the state to sue under its sovereign or quasi-sovereign capacity or solely in a proprietary capacity. See Judith A. Maynes, et al., Recent History of the Connecticut Antitrust Act. 50 Conn. B.J. 274, 283 (1976) (noting that P.A. 75-508, now § 35-44a, allows claims under proprietary, or consumer, capacity).

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Because the AG can not rely on § 35-44a, however, he is left to attempt to shoehorn his claim of authority to seek injunctive relief under § 7 of the Clayton Act into the unaccommodating confines of Section 35-32 (d).¹¹ That section provides in relevant part:

The Attorney General may also bring a civil action in the name of the state in the district courts of the United States under the federal antitrust laws to recover damages and secure such other relief as provided for in such laws as (1) parens patriae for persons residing in the state with respect to damages sustained by such persons . . . (2) parens patriae with respect to damages to the general economy of the state or any political subdivision thereof; provided that such damages shall not be duplicative of those recoverable under subdivision (1) of this subsection.

Section 35-32 (d) was added as an amendment, P.A. 76-218, in 1976, a year after § 35-44a was enacted.

Although § 35-32 (d) permits the AG to bring an action “under the federal antitrust laws,” the language, history and circumstances surrounding the enactment of § 35-32 (d) all evince a legislative intent to limit the AG’s power under that section to seeking recovery of damages sustained by persons residing in the state or by the general economy. Any claim for injunctive relief must be ancillary to a claim for damages actually sustained. Therefore, the AG has no authority to bring such an action, as he purports to do here, seeking solely injunctive relief without a claim for damages.

First, by its plain language, § 35-32 (d) does not provide the AG with authority to seek an injunction. Indeed, that section contains no mention of “injunction,” injunctive relief,” or “enjoin.” A review of the other sections of the Act demonstrates that, when the legislature intended to grant authority to seek injunctions, not surprisingly, it explicitly said so using the words “injunction” or “enjoin.” See § 35-32 (a) (proceedings to enforce the State Antitrust Act “may pray that . . . violation[s] be temporarily or permanently enjoined”); § 35-34 (state may sue

¹¹ Subsections (a), (b), and (c) relate to enforcement of the Connecticut Antitrust Act or to intervention and thus do not provide any statutory authority to bring the present action under the Clayton Act.

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under Act in proprietary capacity “for injunctive relief, both temporary or permanent”); § 35-44a (AG may sue on behalf of state in proprietary capacity “to recover damages or to seek injunctive relief).

In addition, § 35-32 (d) repeatedly uses the word “damages,” which reinforces that the intent of the General Assembly in enacting that section was to grant the AG authority to bring claims for damages. Under § 35-32 (d), the Connecticut attorney general is empowered only to “bring a civil action in the name of the state . . . [as] parens patriae for persons residing in the state with respect to damages sustained by such persons” or to “bring a civil action in the name of the state . . . [as] parens patriae with respect to damages to the general economy of the state or any political subdivision thereof; provided that such damages shall not be duplicative of those recoverable under subdivision (1) of this subsection.” (emphasis added.)

Thus, the omission of the word “injunction,” together with the repeated language that parens patriae claims must be brought “with respect to damages,” demonstrates that, to the extent the AG is empowered to seek an injunction under § 35-32 (d), he may do so only in conjunction with a claim for damages.¹²

Finally, the historical context of § 35-32 (d) further compels the conclusion that it was intended to be limited to federal actions that claim damages. Section 35-32 (d) was passed by the General Assembly in anticipation of Congressional enactment of the Hart-Scott-Rodino Act (“HSR Act”). See Judith A. Maynes, et al., Recent History of the Connecticut Antitrust Act, 50 Conn. B.J. at 285-286 n.50. Section 4C of the HSR Act added a provision to the federal antitrust

¹² This conclusion is supported by comparing the language and history of § 35-32 (d) with § 35-44a, the only other section of the state antitrust act that empowers the AG to bring an action in federal court under federal antitrust law. Whereas § 35-44a section permits a suit “in federal court to recover damages or to seek injunctive relief under federal law, § 25-32 (d) is limited to actions “to recover damages and secure such other relief as provided for [in the federal antitrust laws, i.e., injunctions].”

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laws allowing limited parens patriae damage actions to be brought by state attorneys general, 15 U.S.C. § 15c, but included no corresponding provision for injunctive actions. Thus, the circumstances surrounding the enactment of § 35-32 (d) strongly support the conclusion that the legislature granted authority under that section only to bring actions for damages, allowing other relief only when ancillary to such claims for damages.

In sum, the language, history and circumstances surrounding the enactment of the Connecticut Antitrust Act demonstrate that it was intended to give bounded authority to seek injunctive relief to the AG under the Act and certain comparable federal provisions. The AG’s desire to enjoin a merger under Section 7 of the Clayton Act is simply outside the bounds of his statutory grant of authority. Because the AG is acting beyond the scope of statutory authority, he is without capacity and has no standing to bring this federal claim. Accordingly, the claim under Section 7 of the Clayton Act must be dismissed.

II. THE AMENDED COMPLAINT FAILS TO STATE A CLAIM UNDER STATE LAW

In his second claim for relief, the AG alleges a claim for injunctive relief under Section 3 of the Connecticut Antitrust Act, Conn. Gen. Stat. § 35-26. (Amended Compl. 38.) Because § 35-26 prohibits only completed agreements in restraint of trade, and because the AG has failed to allege an agreement between Oracle and PeopleSoft, the AG has not stated a claim under the Connecticut Antitrust Act. Accordingly, the AG’s second claim for relief should be dismissed pursuant to Fed. R. Civ. P. 12 (b) (6).

Section 35-26 provides: “Every contract, combination, or conspiracy in restraint of any part of trade or commerce is unlawful.” The Connecticut Supreme Court has noted that “[s]ection 35-26 is substantially identical to § 1 of the Sherman Act; 15 U.S.C. §1; and applies to contracts, combinations, or conspiracies in restraint of trade or commerce. The essence of a

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violation of § 1 of the Sherman Act is concerted action. For its provisions to apply, two or more “persons” must agree to act together.” Shea v. First Federal Savings & Loan Ass’n., 439 A.2d 997, 184 Conn. 285, 305 (1981) (citations omitted; emphasis added). “It is well-settled that an individual or corporation cannot alone contract, combine, or conspire to violate the antitrust laws.” McKeown Distributors. Inc. v. GYP-Crete Corp., 618 F. Supp. 632, 645 (D. Conn. 1985). An agreement among two or more parties is an indispensable element of a Sherman Act § 1 violation. See Areeda & Hovenkamp, Antitrust Law, 1403, p. 16 (2d ed.).

Here, the Amended Complaint does not allege an agreement, contract, combination or conspiracy between Oracle and PeopleSoft. Indeed, it is telling that the AG did not include a claim under § 1 of the Sherman Act in his complaint; by not including a claim under § 1 of the Sherman Act, the AG implicitly acknowledges that that section and its state counterpart, § 35-26, do not reach tender offers. Instead, all the AG has alleged is that Oracle has made an offer—one that PeopleSoft’s management has strenuously resisted (to the detriment of PeopleSoft shareholders). An unaccepted tender offer is not an agreement, contract, combination or conspiracy. See United States v. American Airlines. Inc 570 F. Supp. 654, 657 (N.D. Tex 1983), rev’d on other grounds, 743 F.2d 1114 (5th Cir. 1985). The Amended Complaint therefore fails to state a claim under § 35-26.

In addition, because the AG fails to state a claim under the Connecticut Antitrust Act, he has no claim for injunctive relief pursuant to § 35-34. Section 35-34 provides in relevant part: “The state or any person, including, but not limited to, a consumer, may sue for injunctive relief, both temporary and permanent, against threatened loss or damage to its property or business by any violation of this chapter. . . .” (emphasis added.) The plain language of § 35-34 limits the

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reach of its provisions to violations of the state antitrust act, and because the AG does not properly allege a claim under the Act, he cannot obtain relief under that section.

Finally, because the AG’s federal antitrust claims must be dismissed for the reasons set forth in Part I of this memorandum, this Court should not exercise supplemental jurisdiction over the state law claim in the second count of the Amended Complaint, and, therefore, that claim should be dismissed. See In re Merrill Lynch Ltd. P’ships Litie., 154 F.3d 56, 61 (2d Cir. 1998) (“[t]his Court and the Supreme Court have held that when the federal claims are dismissed the state claims should be dismissed as well”) (internal quotation marks omitted).

III. THE PLAINTIFF’S CLAIMS ARE PREMATURE

Oracle has not acquired PeopleSoft, nor has it even entered into an agreement to do so. At this point, Oracle has commenced its Tender Offer, and several further steps need to be taken and significant obstacles need to be addressed—the timing of which Oracle cannot control -before such an acquisition will occur. (See Declaration of Eric D. Beal 2; Schedule TO and Offer to Purchase filed with the United States Securities and Exchange Commission (“SEC”) on June 9, 2003 is attached as Exhibit A to the Declaration.)¹³ Because Oracle must comply with DOJ premerger antitrust review, and Oracle must address PeopleSoft’s misguided attempts to sabotage the Tender Offer, the AG’s claims under the Clayton Act and the Connecticut Antitrust Act are not ripe and should be dismissed pursuant to Fed. R. Civ. P. 12 (b) (1). Specifically:

• the “poison pill” and other actions taken by the PeopleSoft Board of Directors to entrench itself in office must be resolved;

• the poison pill and related issues are, in turn, dependent on the litigation initiated by Oracle in Delaware to challenge the PeopleSoft Board’s improper actions;

¹³ Oracle submits herewith a Declaration of Eric D. Beal in Support of Oracle’s Motion to Dismiss (hereinafter “Beal Decl.”).

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• the Tender Offer is on statutory hold pending DOJ antitrust review through the Hart-Scott-Rodino (“HSR”) pre-merger review process, which could result in a modification of any transaction;

• if, following the HSR investigation, the PeopleSoft Board does not undo the poison pill and related obstructionist actions, either voluntarily or by order of the Delaware court, Oracle has publicly expressed its intention to seek the replacement of the Board; and

• finally, PeopleSoft’s shareholders must tender their shares.

While Oracle is confident that these items will be resolved fully and completely in its favor, either alone or together, they serve to delay the Tender Offer and may even alter the issues this Court must address in this litigation, rendering the Court’s review of the matter as presently cast a waste of time. Unwilling to wait, however, for the outcome of the Delaware litigation, or the DOJ antitrust review of the proposed transaction, the AG has breathlessly

rushed his unripe claims into this Court. This Court should refuse to waste judicial resources becoming embroiled in the AG’s unripe claims.

The basic rationale underlying the doctrine of ripeness “is to prevent the courts, through avoidance of premature adjudication, from entangling themselves in abstract disagreements. . . .” Abbott Labs. v. Gardner, 387 U.S. 136, 148 (1967), Thus, in evaluating a claim for ripeness, a court properly considers prudential reasons for refusing jurisdiction under the doctrine. See, e.g., Suitum v. Tahoe Regional Planning Agency, 520 U.S. 725, 733 n.7 (1997) (“We have noted that ripeness doctrine is drawn both from Article III limitations on judicial power and from prudential reasons for refusing to exercise jurisdiction.”). As the court of appeals in Metzenbaum v. FERC explained:

Ripeness doctrine is drawn both from Article III limitations on judicial power and discretionary reasons of policy for refusing to exercise power.

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The central concern of both power and discretion is that the tendered case involves uncertain and contingent future events that may not occur as anticipated . . . .

675 F.2d 1282, 1289-90 (D.C. Cir. 1982) (quoting C. Wright, A. Miller & E. Cooper, 13 Federal Practice and Procedure: Jurisdiction § 3532, at 237-38 (1975)).

In the present case, the Tender Offer cannot move forward until the several obstacles noted above are surmounted. There simply is no point to devoting judicial resources, as well as those of the State of Connecticut and Oracle, in quarrelling over a merger the timing of which cannot be known until these events unfold. See Cedars-Sinai Medical Center v. Watkins, 11 F.3d 1573, 1582 (Fed. Cir. 1993) (action did not meet either the Article III tests of ripeness or the tests that involve “the discretionary prudential consideration of conservation of judicial resources”).

For example, PeopleSoft’s “poison pill,” by which the board of directors of PeopleSoft has sought to entrench itself in office, is the subject of a lawsuit filed on June 18, 2003, by Oracle against PeopleSoft and its board of directors. (Beal Decl. ¶ 4, 5; Complaint is attached as Exhibit C to Declaration.) Although Oracle believes that these actions by the PeopleSoft Board are an unjustifiable attempt at self-preservation at the expense of PeopleSoft’s shareholders, they nevertheless impose delay, albeit unnecessarily, on the ultimate confirmation of the Tender Offer. So long as these issues remain outstanding, the AG’s challenge is premature.

In addition, the pendency of several state court actions requires a finding that the AG’s present antitrust action is not ripe. Courts consistently have held that claims that hinge on “contingent future events,” such as concurrent state litigation, are not ripe. See, e.g Step-Saver Data Sys., Inc. v. Wyse Technology, 912 F.2d 643, 646-652 (3d Cir. 1990) (federal action not

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ripe because contingent upon uncertain outcome of 12 state actions); Crestar Mortgage Corp. v. Peoples Mortgage Co., 818 F. Supp. 816, 820 (E.D. Pa. 1993) (“[f]ederal ripeness doctrine . . . counsels against adjudication of questions that might be altered or dissolved by further action in the state court”).

Here, although Oracle maintains that the conduct of the PeopleSoft Board is, among other things, a breach of its fiduciary duties, the Board’s obstinacy has unfortunately required Oracle to initiate litigation in Delaware Chancery court, (Beal Decl. ¶ 4; see Oracle Corp. & Pepper Acquisition Corp. v. PeopleSoft et al., CV 20377NC (Del. Ch, June 18, 2003)), and PeopleSoft has filed a separate action against Oracle in California. (Beal Decl. ¶ 3a; Exh. B ¶ 15, p. 29.) Despite Oracle’s belief that it will prevail in Delaware, and that the California action is frivolous, this litigation must be resolved before the Tender Offer can proceed, further supporting the absense of ripeness of the AG’s antitrust action.

Perhaps the most significant obstacle, though, is the pending regulatory review of the Tender Offer, notably that by the United States Department of Justice which has issued a Second Request regarding the proposed merger. (Beal Decl. ¶ 3b; Exh. B.¶ 15, p. 28.) Courts have consistently recognized that it does not make sense to devote judicial resources to evaluating actions against events that are contingent upon regulatory review and approval because, among other reasons, such review has the potential to modify the transaction under review.¹⁴ Courts are particularly reluctant in antitrust cases to adjudicate issues that are subject to regulatory

¹⁴See, e.g., South Austin Coalition Cmlv. Council v. SBC Communications. Inc., 191 F.3d 842 (7th Cir. 1999) (Clayton Act action to block merger not ripe because merger contingent on and may be modified by regulatory review); US West Communications v. MFS Intelenet. Inc., 193 F.3d 1112, 1118 (9th Cir. 1999); In re Drexel Bumham Lambert Group Inc., 995 F.2d 1138, 1146 (2d Cir. 1993) (plaintiffs’ claims contingent on SEC decision and court order in preliminary litigation); Chicago & Northwestern Trans. Co. v. SOO Line R.R., 739 F. Supp. 447, 450 (D. III. 1990) (because regulatory approval of agreements was required, “any injury which [plaintiff] may suffer as a result of [the agreements] is purely speculative at this time”).

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scrutiny.¹⁵In South Austin Coalition Cmty. Council v. SBC Communications Inc., 191 F.3d 842, 845 (7th Cir. 1999), for example, the court dismissed as premature a private suit for an injunction blocking a prospective merger under section 7 of the Clayton Act, 15 U.S.C. § 26, stating:

Until the agencies have had their say, it is impossible to perform the sort of antitrust analysis that is integral to a potential competition case, and it therefore would be a waste of everyone’s time to proceed. Antitrust litigation can be very costly; an expensive challenge to a moving target is worse than pointless.

Accord United States v. Michigan Nat’l Corp., 1974 U.S. Dist. LEXIS 12205 (E.D. Mich., Feb. 19, 1974) (challenge to merger under section 7 of Clayton Act premature because merger contingent upon regulatory approval). Oracle remains confident that the proposed acquisition poses no antitrust issues, and it expects that DOJ will come to the same conclusion upon compliance with the Second Request. In the meantime the Tender Offer may not move forward until DOJ completes its antitrust review. See 15 U.S.C. § 18A. And as recognized in South Austin and Michigan Nat’l, regulatory scrutiny itself counsels in favor of waiting to see how events unfold.

Finally, even if all of the above contingencies resolve in favor of the proposed acquisition - the deal is approved without modification by DOJ, the Delaware litigation in the trial court, and possible appeals, permit the Tender Offer to go forward—PeopleSoft’s shareholders still must assent to the Tender Offer.

In a case analogous to the circumstances here, Volvo N. Am. Corp. v. Men’s Int’l Prof’l Tennis Council. 857 F.2d 55, 65 (2d Cir. 1988), the plaintiff challenged a series of allegedly

¹⁵ Indeed, mergers are often modified during the course of the regulatory review process. See Statement of R. Hewitt Pate before the U.S. House of Rep. Judiciary Committee, p. 9 (July 24, 2003,) (noting that since June 2001, of 34 mergers challenged, 9 were resolved through modification and 12 through restructuring during pendency of DOJ’s antitrust review) (available at <http://www.usdoi.gQv/atr/public/testimony/201190.htm>.)

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anticompetitive proposed rules under consideration by the Men’s Tennis Council. The Second Circuit sua sponte raised the question of ripeness and found the challenge to three specific rules unripe because it was “difficult to predict how appellees will choose to employ the three remaining rules should they be enacted [and the] rules may be clarified by the further factual development that would accompany their adoption.” Similar to the proposed rules in Volvo, the proposed transaction here may be altered by subsequent events. In such circumstances, a court should wait to see how those events unfold. See United States v. Muzak LLC, 275 F.3d 168, 178 (2d Cir. 2001) (“[p]ursuant to ripeness doctrine, we must avoid entangling ourselves in abstract disagreements and engaging in premature adjudication”) (citation omitted).

In sum, under both the Article III and prudential rationales of ripeness doctrine, the AG’s action is premature. The AG’s claims rest on future events that must be addressed prior to any acceptance of the Tender Offer and thus do not warrant the attention of the Court and the parties’ resources at this point. Accordingly, the AG’s Amended Complaint should be dismissed in its entirety.

CONCLUSION

For the reasons stated above, Oracle respectfully requests:

A. With respect to the federal claim under section 7 of the Clayton Act, this Court find that:

• the AG lacks standing as parens patriae to bring the federal claim; and

• the AG’s asserted proprietary interest fails to allege antitrust injury to Connecticut, an essential element the federal claim; or, in the alternative,

• the AG lacks capacity, or statutory authorization under state law, to bring the federal claim.

B. With respect to the state antitrust law claim, this Court find that:

• Connecticut antitrust laws do not apply to unaccepted tender offers, so the AG failed to state a claim under state antitrust law; or, in the alternative,

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• because this Court lacks subject matter jurisdiction over the federal claim, the AG’s state law claim should also be dismissed for lack of supplemental jurisdiction.

On the basis of these findings, Oracle further requests that this Court enter an order dismissing the Amended Complaint with prejudice.

If, however, the Court were to recognize standing in the AG, Oracle respectfully requests that the Amended Complaint be dismissed without prejudice and with leave to re-file, because the AG’s hastily brought claims are premature and unripe.

Dated: August 18, 2003

Respectfully Submitted,

/s/ William M. Rubenstein

William M. Rubenstein (ct08834)

E-mail: wmr@avhlaw.com

Eric D. Beal (ct23167)

E-mail: exb@avhlaw.com

Axinn, Veltrop & Harkrider LLP

90 State House Square

Hartford, CT 06103-3702

Telephone: 860-275-8100

Facsimile: 860-275-8101

Attorneys for Defendants

ORACLE CORPORATION and

PEPPER ACQUISITION CORP.

39

CERTIFICATION

THIS IS TO CERTIFY that a copy of the foregoing Memorandum has been delivered by hand this 18^th day of August, 2003 to:

Steven Mark Rutstein, Esq.

Roger F. Reynolds, Esq.

Attorney General’s Office

55 Elm St.

Hartford, CT 06106

Clare E. Kindall, Esq.

Attorney General’s Office

55 Elm St.

Hartford, CT 06106

/s/    ERIC D. BEAL

Eric D. Beal

AXINN, VELTROP & HARKRIDER LLP

40

UNITED STATES DISTRICT COURT

DISTRICT OF CONNECTICUT

STATE OF CONNECTICUT, ex rel.	)
Attorney General	)	CIVIL ACTION NO. 03-CV-1072 (AWT)
RICHARD BLUMENTHAL	)
Plaintiff,	) )
v.	) )
ORACLE CORPORATION and PEPPER ACQUISITION CORP.	) ) )
Defendants.	) )	August 18, 2003

DECLARATION OF ERIC D. BEAL

IN SUPPORT OF DEFENDANTS’ MOTION TO DISMISS

I, Eric D. Beal, submit this Declaration in support of Defendants’ Motion to Dismiss and declare as follows:

1. I am an attorney for Oracle Corporation appearing in this action. This Declaration is submitted in support of the Motion to Dismiss the Amended Complaint by the Defendants, Oracle Corp. and Pepper Corp.

2. Attached hereto as Exhibit A is an accurate copy of Schedule TO and Offer to Purchase filed with the United States Securities and Exchange Commission (“SEC”) on June 9, 2003. On that date, Pepper Acquisition Corp. (“Pepper”), a wholly-owned subsidiary of Oracle Corporation (individually, and collectively with Pepper, “Oracle”), extended a cash tender offer (the “Tender Offer”) for all of the outstanding common stock of PeopleSoft, Inc. (“PeopleSoft”), along with the accompanying share purchase rights issued pursuant to the First Amended and Restated Preferred Shares Rights Agreement, dated December 16, 1997, between PeopleSoft and BankBoston, N.A., as Rights Agent (“the Rights Agreement”).

3. Attached hereto as Exhibit B is an accurate copy of Amendment No. 22 to Schedule TO filed with the SEC on July 24, 2003. Exhibit B provides in relevant part as follows:

a. On June 13, 2003, PeopleSoft filed an action in state court in California seeking to enjoin the Tender Offer. (Exh. B ¶ 15, p. 29.)

b. As part of its antitrust review, the Antitrust Division of the Department of Justice (“DOJ”) issued to Oracle and PeopleSoft a “Second Request” for information on June 30, 2003, requesting a large number of documents and interrogatory responses. (Exh. B ¶ 15, p. 28.)

41

4. Attached hereto as Exhibit C is an accurate copy of the Complaint filed in the Delaware Chancery Court in the action styled Oracle Corp. & Pepper Acquisition Corp. v. PeopleSoft et al., CV 20377NC (Del. Ch., June 18, 2003) (the “Delaware Complaint”).

5. The gravamen of the Delaware Complaint is as follows:

a. PeopleSoft’s management and directors have vigorously contested Oracle’s Tender Offer, with both public announcements of opposition and numerous defensive measures designed to deter or prevent the consummation of the Tender Offer. (Exh. C ¶¶ 1-3.)

b. PeopleSoft has refused to negotiate with Oracle or even discuss the terms of the Tender Offer or any acquisition of PeopleSoft by Oracle. (Exh. C ¶¶ 3, 27-29.)

c. The PeopleSoft board, among other things, has taken the following steps to undermine the tender offer: (i) it has refused to redeem the purchase rights plan, or “poison pill”; (ii) it has refused to exempt the tender offer from the operation of Delaware’s anti-takeover statute, 8 Del. C. § 203; and (iii) it has created a “customer poison pill” by telling its customers that if the tender offer if consummated, Peoplesoft may be required to pay them double, or more, of their money back. (Exh. C ¶¶ 3, 10, 20-26, 36.)

I declare under penalty of perjury that the foregoing is true and correct.

Executed on August 18, 2003.

/s/ Eric D.Beal

Eric D.Beal (ct23167)

E-mail: exb@avhlaw.com

Axinn, Veltrop & Harkrider LLP

90 State House Square

Hartford, CT 06103-3702

Telephone: 860-275-8100

Facsimile: 860-275-8101

Attorney for Defendants

ORACLE CORPORATION and

PEPPER ACQUISITION CORP.

42

CERTIFICATION

THIS IS TO CERTIFY that a copy of the foregoing Declaration has been delivered by hand this 18^th day of August, 2003 to:

Steven Mark Rutstein, Esq.

Roger F. Reynolds, Esq.

Attorney General’s Office

55 Elm St.

Hartford, CT 06106

Clare E. Kindall, Esq.

Attorney General’s Office

55 Elm St.

Hartford, CT 06106

/s/    ERIC D. BEAL

Eric D. Beal

AXINN, VELTROP & HARKRIDER LLP

43

EX-99.(A)(5)(LXXII)

Exhibit (a)(5)(lxxii)

ORACLE CORPORATION

Moderator: Joelle Fitzgerald

September 12, 2003

7:30 a.m. CT

[TRANSCRIPT HAS BEEN REDACTED TO REMOVE STATEMENTS AND COMMENTS UNRELATED TO THE TENDER OFFER]

Operator: Good day everyone, and welcome to today’s Oracle Corporation First Quarter and Fiscal Year 2004 Results conference call. Today’s conference is being recorded.

At this time, I’d like to introduce Oracle Corporation Director of Investor Relations, Joelle Fitzgerald. Miss Fitzgerald, please go ahead.

Joelle Fitzgerald: OK. Thank you, Operator.

Good morning, everyone, and welcome to Oracle Corporation’s Fiscal First Quarter 2004 Earnings conference call. We were prepared to report our earnings yesterday, but out of respect for September 11th, we decided to do it this morning.

I would like to introduce Larry Ellison, Chairman and Chief Executive Officer, Jeff Henley, Executive Vice-President and Chief Financial Officer and Chuck Phillips, Executive Vice-President.

Today’s call will begin with Jeff reviewing the key financial results, followed by Larry covering the state of the Company. Chuck will then provide some comments on our cash tender offer to PeopleSoft. The discussion will then be followed by a Q&A session.

Before we begin, however, I appreciate your patience as I review the required Safe Harbor and Tender Offer statements.

Our discussion may include predictions, estimates or other information that might be considered forward looking. While these forward looking statements represent our best current judgment on what the future holds, they are subject to risks and uncertainties that could cause actual results to differ materially. Throughout today’s discussion we will attempt to present some important factors relating to our business that may affect our predictions. You should also review our most recent Form 10K and Form 10Q for a more complete disclosure of risk factors.

The solicitation and the offer to buy PeopleSoft’s common stock is only made pursuant to the offer to purchase and related materials that Oracle Corporation and Pepper Acquisition Corp. filed on June 9th, 2003, as amended and restated on July 24th, 2003. Stockholders should read the amended and restated offer to purchase and related materials carefully because they contain important information including the terms and conditions of the offer. Stockholders can obtain the amended and restated offer to purchase and related materials free at the SEC’s Web site at www.sec.gov from Credit Suisse First Boston, the dealer manager for the offer, from (McKenzie) Partners, the information agents of the offer, or from Oracle Corporation.

With that, I’ll now turn the call over to Jeff Henley.

Jeff Henley: Thanks, Joelle.

[REDACTED]

… we expensed about $20 million worth of PeopleSoft related expenses in the quarter.

[REDACTED]

Chuck Phillips: Thanks, Larry. I just wanted give a very brief update on the PeopleSoft transaction, since that’s not the main purpose of this call, I’ll keep it short.

Our tender offer for PeopleSoft, of course, remains in effect. The critical path is regulatory approval and that’s where we are concentrating our efforts. As most of you know, we’ve received a secondary request for information from the Justice Department, which is customary for a transaction of this size and complexity. We continue to compile and deliver the information requested.

We’re going through a similar process with the European Union, doing what’s called a pre-notification period. While difficult to predict, our best estimate at the moment is that the regulatory review process could be completed sometime in November.

So, in a related matter, we’ve also had some time to do some analysis of PeopleSoft’s public guidance on license revenue and want to give out to you on how the two companies stack up. Based on the actual quarters combined on a combined basis from both companies reporting the first half of calendar 2003 and PeopleSoft’s estimated license revenue for Q3 and Q4 of 2003, we believe it’s highly likely that Oracle will report higher applications license revenue for 2003. While it’s been written broadly that PeopleSoft is the second largest applications company, in analysis of combined companies numbers, don’t seem to support that on an apples to apples basis, either on a trailing 12 months basis or on the four quarters of 2003.

We can only presume that that forecast or that statement is based on the 2004 estimates and as you know, 2004 estimates at this point is anybody’s guess. So, we’re not putting a lot of stock in that at the moment.

Lastly, we just want to reiterate that this was the (great) ((inaudible)) (quarter portion) in the applications business. I have a long list of the live customers in front of me. I won’t go through all that, but just a few names on the list: (Sullivan) Gate University with 7,000 users; Siebel Corporation with 10,000 users; Waterpik Technologies; and the University Hospitals of Cleveland. These are all important events as ((inaudible)) of course to position these customers become upgrade and upscale candidates later.

Thanks.

Joelle Fitzgerald: OK. Operator, can we begin the Q&A session, please?

Operator: Certainly. The question-and-answer session will be conducted electronically. If you would like to ask a question today, you may do so by firmly pressing the star key followed by the digit one on your telephone keypad. We ask that you limit yourself to one question today. Once again, that’s star one to ask a question. We’ll now pause a moment to assemble our roster.

[REDACTED]

Operator: Moving on, we’ll hear from Rick Sherlund with Goldman Sachs.

[REDACTED]

Rick Sherlund: And Jeff, last quarter you guys and some other apps companies commented that there was some disruption in the market because of your bid for PeopleSoft and some of the reactions

to that on the part of you know competition and pricing. Are you seeing more of that still? Or is that subsiding?

Jeff Henley: I don’t get a sense that it helped us or hurt us. I mean I don’t think it’s been a major factor one way or the other in terms of selling in the first quarter or from what I can tell, in this new quarter, second quarter. I think we had a number of deals slip and we just sort of ran out of runway because we just didn’t focus on them well enough, early enough and didn’t lose any of them that I’m aware of. So, I think we’ll make them up in the second quarter. And that’s why we’ll I think – part of the reason why we’ll show a very good rebound and good growth in North America in the second quarter.

[REDACTED]

Operator: We’ll now go to Heather Bellini with UBS.

[REDACTED]

Heather Bellini: And if I could just have one follow up, maybe this is for Chuck, but in regards to PeopleSoft has been disclosing how much they’re spending on the Oracle – on you know trying to I guess prevent the take over by Oracle. Could you give us an update on what you’re spending in that regard and what you expect to spend going forward?

Jeff Henley: Well, this is Jeff. I did say on the call we’ve said about $20 – I think it’s about $21 million so far we’ve expensed as regarding the expenses on this acquisition.

Heather Bellini: And what about going forward?

Jeff Henley: We haven’t given a forecast, but as long as we are working with the Justice Department and working on lawsuits against and defending ourselves, there will be some expense. I don’t know precisely – it’s certainly not a material number given our size.

Heather Bellini: Alright. OK. Thank you very much.

[REDACTED]

Operator: That concludes today’s question-and-answer session. Miss Fitzgerald, I’ll turn things back over to you for any closing or additional comments.

Joelle Fitzgerald: OK. Thanks everyone for participating in today’s conference call. A replay will be available through the end of the day on Monday. The number is 719-457-0820 passcode 715086. You can also access the call on-demand on our Web site through September 22nd.

Thanks.

Operator: That concludes today’s teleconference. We thank you for your participation.

END