Defect theory for prime ideals and Dress's induction theorem Submitted on June 8, 1998, to appear in {\it Algebras and Representation Theory} Author: Hubert Fottner Friedrich-List-Str.~7 D-86153 Augsburg Germany Abstract: It was first observed by Dade that defect groups can be defined for arbitrary rings with finite group action as long as one replaces points (resp.~primitve idempotents) with maximal ideals which, in general, are no longer in bijection. Later The\'evenaz showed that also Puig's theory of pointed groups carries over to this more general setup. So, in a sense, one can also define sources of maximal ideals. Moreover, Th\'evenaz demonstrates that this cannot only be done for rings with finite group action, but also for the more general notion of a Green functor. The objective of this paper is to show that the results carry over to a situation where one replaces maximal ideals by prime ideals. As an application we prove that, for certain Green functors $A$ for $G$, the Krull dimesion of $A(G)$ can be bounded in terms of the Krull dimensions of $\overline{A}(P)$, where $P$ ranges over all primordial subgroups of $G$ for $A$. Moreover, we shows that Puig's version of Sylow's first theorem for local pointed groups can be generalized to the situation we are concerned with in this paper, and we demonstrate that Dress's induction theorem is a consequence of this result. Beides, this version of Sylow's first theorem is correlated with a theorem of Dress asserting that the primitve idempotents of the integral Burnside ring are parametrized by the conjugacy classes of perfect subgroups, and also with Brauer's induction theorem for the character ring.