Oracle Agrees to Pay Over $200 Million to Settle False Claims Suit

Last week, Oracle Corp. and Oracle America, Inc. agreed to pay $199.5 million plus interest for failing to meet their contractual obligations to the General Services Administration (GSA). The settlement resolves a lawsuit filed on behalf of the U.S. government by former Oracle employee, Paul Frascella, who will receive $40 million as his share of the recovery in the case, and marks the largest single recovery for the GSA under the False Claims Act. The allegations in Mr. Frascella’s suit related to a contract Oracle entered into in 1998 to sell software licenses and technical support to government entities through GSA’s Multiple Award Schedule (MAS) program. The MAS program provides the government and other GSA-authorized purchasers with a streamlined process for procurement of commonly used commercial goods and services. 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. “Companies that engage in unlawful or fraudulent practices to secure government business undermine the integrity of the procurement process and create an unfair advantage against the majority of companies that are playing by the rules,” said Tony West, Assistant Attorney General for the Civil Division of the Department of Justice.

For more information see:  http://www.justice.gov/opa/pr/2011/October/11-civ-1329.html