Oracle Settles Kickbacks Complaint for $46 Million

Posted 02/01/2011 at 9:35am | by Paul Lilly

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When Oracle scooped up Sun Microsystems in 2010, it also inherited the latter's legal woes, including complaints that Sun paid kickbacks to systems integrators in exchange for recommending Sun products to federal organizations. According to the U.S. Department of Justice, Oracle has agreed to put the matter to rest by coughing up $46 million to settle the suit, InfoWorld.com reports.

"Kickbacks, illegal inducements, misrepresentations during contract negotiations -- these undermine the integrity of the government procurement process and unnecessarily cost taxpayers money," Tony West, assistant attorney general for the DOJ's Civil Division, said in a statement. "As this case demonstrates, we will take action against those who abuse the public contracting process."

The settlement, which covers allegations dating as far back as 2004, also resolves charges of violating the False Claims Act in which Sun allegedly provided incomplete and inaccurate information to GSA (General Services Administration Schedule) contracting offers during negotiations in 1997 and again in 1999.