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Oracle, PeopleSoft CEOs File Depositions

SAN FRANCISCO -- The chief executive officers of Oracle and PeopleSoft will answer questions about the controversial hostile takeover bid before the weekend is through, officials with both companies said during court proceedings here Friday.

The U.S. Department of Justice and ten states want to block Oracle's unsolicited plans to acquire PeopleSoft, arguing that the merger between two major enterprise software providers would be anti-competitive and limit customers' choices. Oracle is fighting to thwart the DoJ's stance. The trial begins on June 7 and is expected to last six weeks.

Craig Conway, CEO of Pleasanton, Calif.-based PeopleSoft, met with representatives of Oracle's legal team early this morning to discuss his opposition to Oracle's now $7.7 billion proposal to acquire his company. Conway was subpoenaed by his former employer and is expected to take the stand in a six-hour session during the trial. To date, PeopleSoft has submitted more than 2 million documents to Oracle as part of its court testimony.

Oracle CEO Larry Ellison is scheduled to meet with government officials on Sunday, May 23 to answer questions about the unsolicited bid, a spokesperson with the U.S. Department of Justice confirmed late Thursday. Three e-mails submitted to the courts this week accused Oracle of stonewalling Ellison's affidavit before the trial. The DoJ also has questioned Oracle President Safra Catz.

During court proceedings, District Court Judge Vaughn R. Walker named Former U.S. District Judge Charles Legge as a "special master" of the court to advise third-party companies that are working with the DoJ on how to best prevent their corporate secrets from becoming public record.

The Department of Defense and Fidelity Employer Services -- both large customers of Oracle's -- as well as rivals like Microsoft , SAP , Siebel Systems, BearingPoint, and niche software vendors such as Lawson Software have asked the court to block disclosure of certain information about their business technology. The documents could contain detailed data on customers, competitive bids on contracts, pricing details, budgets and product information.

Judge Walker has repeatedly said he intends to keep the proceedings open but admitted that Oracle's rivals do need to "hone down" their disclosures.

"What we are talking about is the kind of information that one of the parties intends to use at trial," Judge Walker said. "These documents, if subpoenaed, will be used. The question here is how to treat the information in those documents in a way that would not cause harm. An overly broad claim of confidentiality would not mean the same in the process."

Former judge Legge met with representatives of the third parties in a closed-door session soon after being named to the post. All sides are expected to next meet on May 28, with a report due back to the court on June 3.

The court then spent the next four hours on a tutorial to familiarize Judge Walker with Oracle and PeopleSoft's products and the technological differences between the two. The presentation was crucial in that it addresses the court's request to better define the market definitions of enterprise resource planning (ERP) tools -- Human Resource Management or Financial Management Services -- and Oracle's traditional database products.

The DoJ submitted a slide show from PeopleSoft CTO Rick Bergquist, as well as a videotape used by consultants to let customers evaluate the competing software products. Oracle lawyers opted for a live presentation.