SuccessFactors Announces Resolution in Litigation against Softscape

SAN MATEO, Calif.--(BUSINESS WIRE)--SuccessFactors, Inc. (NASDAQ:SFSF), the global leader in on-demand performance and talent management solutions, today announced the conclusion of its litigation against Softscape. As part of the settlement, Softscape has issued a press release acknowledging it created a March 2008 PowerPoint presentation entitled “The Naked Truth,” designing it to look as if it came from a disgruntled SuccessFactors customer. Softscape further acknowledges that the presentation contained inaccurate information about SuccessFactors and that Softscape was responsible for distributing the presentation “anonymously” over the Internet. In admitting responsibility, Softscape also agreed to pay SuccessFactors an undisclosed amount in settlement and dismiss with prejudice all counterclaims against SuccessFactors.

“If you are thinking about purchasing from SuccessFactors, please read the following document; it provides information about SuccessFactors which they do not want you to know.”

“This settlement validates the stance we have taken on this matter from the beginning,” said Lars Dalgaard, chief executive officer for SuccessFactors. “When this document was first distributed by Softscape, we stated we would take every necessary legal action to defend the reputation and integrity of our company, as well as of the hundreds of dedicated SuccessFactors employees who have contributed to making us the leader in our market, from such an underhanded attack by Softscape. We are very pleased to have successfully resolved this matter. We sincerely hope that our industry can return to doing business the right way and with the highest ethical standards, where fair competition is defined around who delivers the best products, service and value to customers.”

The legal dispute originated in early March 2008 when SuccessFactors learned that someone using the name “John Anonymous” had distributed “The Naked Truth” presentation to hundreds of people in the industry. The presentation was emailed to a long list of SuccessFactors’ customers and prospects, as well as industry analysts and the sales groups of SuccessFactors’ direct competitors. It was accompanied by a cover email warning recipients: “If you are thinking about purchasing from SuccessFactors, please read the following document; it provides information about SuccessFactors which they do not want you to know.”

In short order, SuccessFactors exposed Softscape as the author and likely distributor of the presentation. It filed a lawsuit on March 11, 2008 against Softscape in the United States District Court for the Northern District of California (Case No. CV 08 1376 EDL) for False Advertising, Trademark Infringement, Computer Fraud and Abuse, Defamation, Trade Libel, Intentional Interference with Prospective Economic Relations, and Unfair Competition. The Court issued a temporary restraining order against Softscape two days later, and granted a preliminary injunction in favor of SuccessFactors on March 28, 2008, precluding further distribution of the presentation and repetition of its false content. As part of the settlement, Softscape has agreed that the preliminary injunction will become permanent, as part of a stipulated judgment. In addition, to address SuccessFactors’ allegations that Softscape had misappropriated trade secrets in obtaining a SuccessFactors customer list to which Softscape distributed the presentation, Softscape further agreed to be permanently enjoined from “obtaining from any partner or other person, or using, any non-public list of SuccessFactors’ prospects or leads.”

Dalgaard continued, “We believe the market is the true winner here. Customers want products that work from vendors they can trust. While we celebrate the conclusion of this distraction, we remain focused on delivering the industry’s most innovative and useful solutions, because now more than ever, companies are looking for trusted and proven approaches to driving business performance.”

Softscape’s press release is available at http://www.softscape.com/us/pr2008/pr_08_1222_sf-stlmnt.htm or, alternatively, http://www.successfactors.com/softscape-settlement/.

About SuccessFactors, Inc.

SuccessFactors is one of the fastest growing public software companies and the leading provider of on-demand employee performance and talent management solutions. The company enables organizations of every size, and across every industry and geography, to achieve high-performing workforces through goal alignment and execution, talent development and planning, and pay-for-performance initiatives. From 92 customers and approximately 282,000 end users in 2003 to more than 2,360 customers and 4 million end users today, SuccessFactors’ solutions are widely deployed across 60 industries in over 185 countries in 31 languages. Founded in 2001 with offices around the world, the company employs passionate people focused on revolutionizing the future of work. For more information, visit: http://www.successfactors.com.