According to media reports and public announcements from the company, software maker SAP has decided to take a different tact in its trade secret litigation with Oracle:

“Yes, we did it… but we didn’t see it.” Um…what????

SAP admitted this week that a subsidiary had completed “inappropriate downloads” of documents belonging to arch competitor Oracle. However, the company said that it had not had access to that material because firewalls had protected the downloads from SAP’s view.

“Even a single inappropriate download is unacceptable from my perspective. We regret very much that this occurred,” SAP Chief Executive Henning Kagermann said, striking a more conciliatory note than recent SAP declarations that it would aggressively defend itself in the case.

Commentary: SAP didn’t have much of a choice as they were caught RED-HANDED (we covered this in an earlier post back in March). That being said, we are more inclined to agree with JP Morgan software analyst Stefan Kuppen who says “Looking at the details they’ve given, it looks like things went wrong at the subsidiary but it doesn’t look like a concerted effort at industrial espionage.”

The bottom line is that Oracle is blowing this case way out of proportion – doing so because they know that they can win the PR war on it.

To an outsider, it is an excellent learning example for employees: a very small division of SAP is causing all kinds of headaches for a global multi-billion corporation. Some good ethics and IP (and judgment) training could have prevented this costly embarrassment.