Oracle and the US Department of Justice (DOJ) have submitted their closing briefs in the government's case to block Oracle's hostile takeover of PeopleSoft, paving the way for closing arguments next week.
The DOJ is seeking to block the $7.7bn (£4.1bn) takeover on the grounds that it would stifle competition in the market for human resources and financial management software used by large corporations, leading to higher prices.
Oracle said it needs the acquisition to thrive in a highly competitive market.
The briefs summed up the arguments made by each side during the month-long trial, incorporating evidence and testimony from witnesses and applying it all to antitrust law.
At the core of the case is whether the government has properly defined a market for complex, "high function" applications that will be harmed by the merger.
The DOJ argued that it has identified a segment of customers for whom Oracle, SAP and PeopleSoft are the only viable suppliers for certain core business applications. It cited testimony from customers who said they believe that prices will rise and product quality diminish if the deal goes through.
The DOJ said its case is based primarily on the suggestion that when products supplied by two merging companies are closer competitors than other available substitutes, the post-merger firm would be able to unilaterally raise prices. The government discounts SAP in this context because, it argued, the German supplier is not a strong competitor for many US-based companies.
"By eliminating head-to-head competition between Oracle and PeopleSoft, the proposed acquisition would cause Oracle to offer lower discounts to US customers" for its high function human resources and financial management software, the government wrote.
"Oracle would find it in its interests to raise prices, without any co-ordination with its remaining rival," it said.
Oracle countered that US-based companies regularly buy software from overseas suppliers, and said the case involves "a textbook global market". A merged Oracle-PeopleSoft would still be less powerful than SAP, making unilateral effects theory inapplicable to the case, its lawyers wrote.
"Antitrust law does not permit a finding that a merged firm facing a substantially larger rival [SAP in this case] could excercise unilateral market power," Oracle's lawyers wrote.
It also denounced the government, as it had done throughout the trial, for its definition of "high function software". The government invented the term in an attempt to define a market that will be harmed by the acquisition, and did so through select customer examples rather than any accepted industry criteria, Oracle argued.
"It is a market definition in chaos; never has a merger case, let alone a successful merger challenge, rested on such an 'amorphous' market definition," Oracle's lawyers wrote.
Were the merger to go ahead, they argued, Oracle would still face "many potent competitive restraints - not only SAP, but Lawson, AMS, increasingly Microsoft and the whole range of outsourcing providers".
A verdict in the case in is expected in August or September.
James Niccolai writes for IDG News Services