PeopleSoft CEO Ousted for 'Situational Ethics'
The opening of a trial related to Oracle's takeover bid of PeopleSoft featured the revelation that CEO Craig Conway was fired last week for making misleading statements about PeopleSoft's sales.
The feisty and assertive Conway told analysts in September of last year that the hostile takeover attempt did not deter sales, according to PeopleSoft board member Steven Goldby, who testified in court Monday.
Golby was quoted in USA Today as saying that Conway's “situational ethics” contributed to his firing. In a deposition provided to PeopleSoft's board late last month, Conway said he downplayed the threat to sales because he was "hoping for a self-fulfilling prophecy."
Goldby also said that he is open to discussing a takeover by Oracle, Bloomberg reported.
“If there's an indication that they would pay what we consider to be the right price, and there's a possibility that we could close the transaction quickly, I'm open to discussions with Oracle,'' Goldby said in testimony at Oracle's suit to knock out PeopleSoft's takeover defenses in Delaware Chancery Court.
“He's speaking for himself,” not for the board, said PeopleSoft's Steve Swasey, director of corporate public relations.
Oracle wants the judge to throw out PeopleSoft's “poison pill” anti-takeover defense, and its guarantee that customers will get $2 billion in refunds if a new owner makes major changes to PeopleSoft's product support.
Legal observers suggest that Oracle is seeking to show that Conway and the PeopleSoft board did not carefully consider the takeover bid.
Conway, who was also fired for his abrasive management style, was replaced by founder David Duffield.
The Justice Department dropped its anti-trust lawsuit against the takeover bid just hours after Conway was fired. The case was one of the major obstacles hindering the takeover attempt.
PeopleSoft says it is performing well even though it is fending off the Oracle takeover. The company expects third-quarter revenue of $680 million to $695 million, compared with analysts' estimates of about $660 million.