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In today's Motley Fool Take:

Did Oracle Play Dirty?

Just when you thought the Oracle(Nasdaq: ORCL) and PeopleSoft(Nasdaq: PSFT)showdown couldn't get any uglier, the gloves have come off.

According to newly released excerpts of PeopleSoft's expanded lawsuit, Oracle's bid for the software company was allegedly designed to damage PeopleSoft and derail its now-completed acquisition of J.D. Edwards(Nasdaq: JDEC).

PeopleSoft's lawsuit includes Oracle employee emails that PeopleSoft says show the database giant's real intentions with its hostile takeover attempt. A day after Oracle announced its bid for PeopleSoft, an unidentified Oracle employee wrote, "We've certainly wounded PSFT... Even if we don't end up closing the deal, this is going to take PSFT some time to recover. And, of course, our corporate image of being aggressive, brash, and marching to the tune of a different drummer has been reinforced."

PeopleSoft also says that Oracle wanted to completely do away with PeopleSoft's products. An email from Oracle's executive vice president, Safra Catz, reads, "This is a really exciting opportunity for Oracle. Though we really won't be continuing their product line or combining operations, there will no doubt be challenges."

Oracle, however, had been open from the get-go about its intention not to continue to produce and sell PeopleSoft products. It said it would provide support for PeopleSoft's customers, but that's about it. Oracle would eventually try to switch those customers over to its own products.

Finally, PeopleSoft alleges that Oracle was hoping the uncertainties around the former's future would drive its share price down, thereby making Oracle's original $16-a-share bid seem more attractive. One email was quoted as saying, "The more something hurts PSFT, the more likely the share price drops and $16 starts to look better."

Oracle says that the emails are being taken out of context, and that this is simply another "diversionary move" by PeopleSoft. There's no hearing date set yet for PeopleSoft's case, and Oracle's $7.3 billion bid for the company is on hold until November, pending the Justice Department's antitrust investigation.

Like curious drivers unable to look away from a gruesome traffic accident, we keep getting pulled back into this drama. We can't wait to see the next episode.

Quote of Note

"Curiosity killed the cat, but for a while I was a suspect." -- Steven Wright

Battling the Music Pirates

The Recording Industry Association of America's campaign to bring copyright-infringing file swappers to justice has gone too far, according to one lawmaker, and as a result the organization has slightly changed its tune.

Sen. Norm Coleman (R-Minn.), chairman of the Permanent Subcommittee on Investigations, called the RIAA's tactic of subpoenaing thousands of users "excessive," and has scheduled hearings on the matter. In a response to Coleman's concerns, the music group promised that it was "gathering evidence and preparing lawsuits only against individual computer users who are illegally distributing a substantial amount of copyrighted music." Though the RIAA has said it would go after heavy users before, it also stayed vague on the subject of light downloaders.

It appears, however, that attempts to stop the heavy-duty abusers are failing. According to research by the NPD Group, file sharing has declined sharply since the RIAA's well-publicized shotgun-subpoena campaign started -- and especially since Verizon Communications(NYSE: VZ) lost a court battle to keep the names of its ISP subscribers private.

However, those households still swapping files are downloading even more than before. "Our data suggests that the RIAA's legal tactics have more of an effect on the attitudes and actions of lighter downloaders," said NPD's Russ Crupnick.

The RIAA has maintained a confident demeanor thus far, but this is a critical time in its efforts to stem the overwhelming tide of illegal music flowing through the Internet. Its subpoena campaign has raised awareness and curtailed the number of illegal file swappers at a time when decent legitimate options -- such as Apple Computer's(Nasdaq: AAPL)iTunes Music Store -- are finally available. We can expect another burst of publicity once the subpoenaed parties have been brought to trial or settlement.

This may be the industry's last, best chance to significantly alter music lovers' habits.

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Sizing Up Sears

After record low mortgage rates in June and record home sales in July, what would you expect from August? Strong sales of home appliances, naturally. That was the news today from Sears(NYSE: S), which reported that home appliance sales were tracking stronger than expected so far this month.

This is particularly good news for Sears considering that around 60% of its sales come from the home appliance category. In addition, Sears may finally break its ugly streak of 23 straight months of negative same-store sales. Earlier this month, the company called for flat same-store sales for August, but today's news signals better-than-expected comps.

Sears, the grandpa of retailers, was all but left for dead earlier this year, but has undergone a remarkable turnaround over the past few months. The big news came last month when the company sold its $29 billion credit card portfolio to Citigroup(NYSE: C). That left Sears as a pure-play retail operation, with cash sufficient to pay off all its outstanding debt.

Now, a month later, the 870-store chain is proving it can effectively compete with other "white goods" retailers, including Best Buy(NYSE: BBY), Home Depot(NYSE: HD), and Lowe's(NYSE: LOW). This transition hasn't escaped Wall Street's notice, of course, as shares have risen more than 100% since bottoming below $20 in March.

Sears stands as a case study of how a divestiture of a non-core business can unlock hidden value in a company. For investors who saw Sears' potential earlier this year, hats off to you. For those taking a new look at the stock today, now's probably a better time to wait and watch how Sears' progress plays out from here.

Discussion Board of the Day: Tax Strategies

Are you thinking about taxes even though we're in the dog days of August? Are you sure that you've made all the right tax moves here in 2003? Is a Chia pet tax-deductible? All this and more -- in the Tax Strategies discussion board. Only on Fool.com.

Quick Takes

The Oklahoma attorney general has filed suit against MCI and former CEO Bernie Ebbers, charging that they violated the state's securities laws by giving false information to investors. This marks the first criminal charge against Ebbers; other officials from the company, including CFO Scott Sullivan, have already been charged. Oklahoma's state pension funds lost $64 million following MCI WorldCom's collapse, and the attorney general says that other state residents lost even more.

As expected, candle company Blyth(NYSE: BTH) posted lower quarterly earnings this morning. The company earned $11.2 million, or $0.24 a share, vs. $18.8 million, or $0.40 a share, in the same period last year. Sales increased 3% to $275.3 million, helped by a weak dollar and including recently acquired businesses. Not counting those factors, sales actually fell 8%.

Shares of semiconductor company Semtech(Nasdaq: SMTC) rose almost 17% today, after it reported second-quarter earnings and announced some executive shuffling. Semtech earned $2.4 million, or $0.03 a share, compared to $11 million, or $0.14 a share in the prior year's period. This year's second-quarter results include a pre-tax charge of $6.8 million related to the company's convertible subordinated notes. Semtech also announced that Jason Carlson, its president and COO, will replace Jack Poe as CEO. Poe will remain as chairman.

And Finally...

Today on Fool.com: Get paid to invest, really.... Wouldn't you like to read our Top 10 Smartest CEO Decisions?... In this Motley Fool classic, David Gardner fires back at buy-and-hold critics.... Robert Brokamp invites you to make money the Ben Stein way.... And Bill Mann knows where American jobs are disappearing to.

Bob Bobala, Robert Brokamp, Paul Elliott, Mathew Emmert, Jeff Fischer, Tom Jacobs, LouAnn Lofton, Bill Mann, Selena Maranjian, Rex Moore, Rick Munarriz, Matt Richey, Reggie Santiago, Dayana Yochim