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Oracle to Pay US $199.5 Million to Settle Claims

Thursday, 06 Oct 2011 05:36 PM

Oracle Corp. agreed to pay $199.5 million plus interest for failing to meet contractual obligations to the federal General Services Administration, the U.S. Justice Department said.

The payout is the largest ever obtained by the GSA under the federal False Claims Act, the Justice Department said today in a statement. The GSA is responsible for federal facilities management, design, construction, telecommunications and technology procurement.

The agreement relates to a 1998 contract for Oracle software licenses and technical support. It resolves claims that Oracle didn’t provide complete information about its best prices, the government said in the statement.

“It’s more important now than ever before to make sure that taxpayer dollars are not wasted on higher prices,” GSA Inspector General Brian Miller said in the statement. “We will not let contractors victimize the taxpayers by hiding their best prices.”

Oracle, based in Redwood City, California, is the world’s second-largest maker of software. In 2007, the company was sued by former employee Paul Frascella. The U.S. intervened last year in the case in federal court in Alexandria, Virginia.

Frascella will receive $40 million as his share of the recovery, according to the Justice Department statement.

“Oracle vigorously denies that it did not scrupulously adhere to the pricing requirements of that contract,” it said in its own statement confirming the accord. “The company has always had strong controls in place to insure that the government agencies who purchased from the GSA schedule received fair pricing.”

“Oracle never committed any fraud whatsoever,” it said.

The case is United States of America v. Oracle Corp., 07- cv-00529, U.S. District Court, Eastern District of Virginia (Alexandria).

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Oracle Corp. agreed to pay $199.5 million plus interest for failing to meet contractual obligations to the federal General Services Administration, the U.S. Justice Department said. The payout is the largest ever obtained by the GSA under the federal False Claims Act, the...
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Thursday, 06 Oct 2011 05:36 PM
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