It seems that SHARD is a term used already in 1988, meaning "System for Highly Available Replicated Data"
Source: https://scholar.google.com/scholar?cluster=14914487445955020...
Source: https://scholar.google.com/scholar?cluster=14914487445955020...
For that reason (in addition to the low number of citations), I think it's very likely that the name is a total coincidence. Pretty much any word you can think of has been used by somebody as an acronym for some project.
Other the other hand, I found many papers citing the SHARD paper - more than the official count. That's a difficulty with citation counts of old papers: a lot of the papers citing it are also old papers, and we're not consistent at tracking the citations of old papers. Personally, I don't have a conclusion. The SHARD paper is decently cited, and its usage is close to the modern one. On the other hand, I can't find any smoking gun pre-1997 usage of "shard" in the modern meaning.
For example, there are also papers in Google Scholar (findable via query [database shard], through 1987) mentioning this same SHARD system in 1986 and 1987, with 33 and 97 citations respectively. And further, there's a 1986 MIT technical note that mentions a commercially-in-development version of this SHARD system, but refers back to a 1985 paper, "System architecture for partition-tolerant distributed databases", as an authoritative source about SHARD – though that 1985 paper doesn't declare the name SHARD.
That's suggestive that SHARD was adopted as a catchy name for that particular work around 1985-1986, then becoming more widespread in the 1986-1988 timeframe.
But perhaps more interesting: that original 1985 paper mentions in its acknowledgements Hector Garcia-Molina – a definite 'hub' person in databases/indexing/networked-information for decades, among many other things Google cofounder Sergey Brin's advisor at Stanford from 1993-1997. (See: <https://en.wikipedia.org/wiki/H%C3%A9ctor_Garc%C3%ADa-Molina...)
So it's likely safe to assume that from the late 80s into the 90s, top CS students/researchers around the world discussing partitioned distributed databases would often have this particular sense of SHARD mentioned to them, or appear in their readings.
Notably, that 1985 SHARD involved a system where each replica contained the entire database – so did not capture the modern connotations of 'shard', as horizontal partitions. But that vivid & apropos analogy was "in the air" around partitioned/distributed databases.
Thus I'd strongly suspect uses in the modern, non-overlapping sense in that same era, likely predating Ultima Online's 1996ish use. (I'd especially look around precursor work to the 1997 'Consistent Hashing' paper, & other caching-centric work – because there the idea of partition-by-key was central.)
So UO might have devised, but I'd guess more likely popularized, our modern sense of 'sharding'.