The software maker hires Cleary, Gottlieb, Steen & Hamilton to defend lawsuits brought by Oracle and some PeopleSoft shareholders aimed at removing some major obstacles to the takeover.
The business software maker enlisted Cleary, Gottlieb, Steen & Hamilton to represent it in Delaware Chancery Court, where it is defending against lawsuits brought by Oracle and some PeopleSoft shareholders aimed at removing some major obstacles to the proposed takeover, according to PeopleSoft spokeswoman DeeAnna McPherson. She added that PeopleSoft has not yet registered the firm with the court so that it can officially participate in the proceedings.
McPherson declined to comment on the reasons for hiring Cleary Gottlieb.
Lawyers who specialize in mergers and acquisition said that hiring a new firm at this stage of the game is unusual, given the prominence of the case and the fact that it is already well under way.
The move is expected to reduce the role played by Gibson Dunn & Crutcher, a large firm that has been a key player in the Delaware case for PeopleSoft.
"PeopleSoft felt (Gibson Dunn) lacked aggressiveness in handling the Chancery case," said one source familiar with the move who is not involved in the case. "Gibson Dunn won't really be involved in setting strategy issues anymore, or making a lot of appearances in Chancery court."
Cleary Gottlieb joins Gibson Dunn and Potter Anderson & Corroon, a Delaware-based firm, on the Delaware litigation team. Gibson Dunn will continue to serve as the lead attorney in PeopleSoft's lawsuit against Oracle in Alameda County Superior Court, as well as its lead outside corporate counsel.
PeopleSoft is fighting a lawsuit that Oracle filed in Chancery Court to remove PeopleSoft's antitakeover measures, including a shareholders rights plan and a customer assurance program that guarantees buyers of PeopleSoft products significant reimbursements if they lose support for the company's software in the future.
If the customer assurance program is allowed to stand, it would effectively derail the deal, Oracle has complained in legal filings.
Although Cleary Gottlieb was hired for the Chancery Court case, the firm has a strong international antitrust practice that could prove helpful to PeopleSoft as well. Last month, Cleary Gottlieb hired Francisco Enrique Gonzalez Diaz, former unit head of the European Commission's merger task force, as a partner in its Brussels office. The European Commission on Monday, announced it would expand its investigation into Oracle's takeover bid for PeopleSoft.
McPherson said that Gary Reback, an antitrust attorney who played a key role in the Justice Department's suit against Microsoft, will remain PeopleSoft's lead antitrust attorney.