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Oracle pay $200 million to clear a ‘false claims’ lawsuit

Oracle, led by outspoken CEO Larry Ellison has apparently paid the US government almost $200 million to make a false claims lawsuit disappear.

The General Services Administration (GSA), who bought the case have said that this settlement is the biggest they have received from a single company. The GSA receive the money, plus interest from Oracle for ‘failing to meet their contractual obligations’.

The story appears in great detail over at Network World, and author Michael Cooney says “According to the US Department of Justice, “the settlement resolves allegations that, in contract negotiations and over the course of the contract’s administration, Oracle knowingly failed to meet its contractual obligations to provide GSA with current, accurate and complete information about its commercial sales practices, including discounts offered to other customers, and that Oracle knowingly made false statements to GSA about its sales practices and discounts.”

According to the report, Oracle were meant to inform the GSA is they were offering discounts on products and these had to match the terms it was supplying to the government. Apparently they made false claims to the GSA about the sales practices and discounts, to avoid pricing reductions due to a clause in the contract. In a nutshell, the US Government paid more for Oracle products, than it should have.

Former Oracle employee Paul Frascella brought the case to light, and he receives a very tasty $40 million for his share in the recovery of the funds.

Kitguru says: $200 million isn’t that big a deal for Oracle.

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