San Diego, Sept. 14, 2011 (Shareholders Foundation) -- An investor in shares of Oracle Corporation (Public, NASDAQ:ORCL) filed a lawsuit against certain directors and officers of Oracle Corp. in connection with an alleged Policy of overcharging the U.S. Government in a software contract.
According to the complaint the plaintiff alleges that the actions by the defendants resulted in damage to Oracle's reputation, goodwill, and standing in the business community that allegedly exposed Oracle Corp to billions of dollars in potential liability by overcharging the federal government for decades. Based on the federal government’s estimate, it purchased approximately $1.08billion in products from Oracle Corp from 1998 to 2006 and $775 million from 2001 to 2006, so the lawsuit. Further the plaintiff claims that even though Oracle Corp would have been required to charge the federal government the lowest price it charged any of its private customers, Oracle fleeced the federal government by hundreds of millions of dollars by overcharging for these products, in some cases overcharging the federal government by more than 50 percent and the defendants “expressly or tacitly approved this modus operandi, and, together with the company's senior management, breached their fiduciary duties to Oracle.
The lawsuit by the investor follows an earlier media report about alleged investigations by the U.S. Department of Justice (“DOJ”) and the U.S. Securities and Exchange Commission (“SEC”) for possible violations of the Foreign Corrupt Practices Act (“FCPA”) concerning Oracle’s software sales to government agencies in Western and Central African countries. In 2007 an ex-employee whistleblower allegedly brought the concerns to light in a qui tam whistleblower lawsuit against the company. The U.S. Department of Justice allegedly interviended in the whistleblower lawsuit and in January a federal judge denied, for the most part, Oracle’ Corp’s motion to dismiss that lawsuit.
In a related case, so the plaintiff, Oracle Corp. paid $8 million in 2005 to settle another whistleblower suit accusing it of overcharging the federal government for computer training, and in 2006 Oracle agreed to a $98.5 million False Claims Act settlement involving PeopleSoft, one of the subsidiaries of Oracle Corp.
Oracle’s 12months Total Revenue rose over the past four filing periods from $22.43billion to $35.62billion and its Net Income increased from $5.52billion to $8.54billion.

Shares of Oracle Corporation (Public, NASDAQ:ORCL) rose from as low as under $15 in March 09 to almost $36 per share in April 2011. However since April ORCL stocks fell to recently under $25 per share and closed on September 13, 2011 slightly below $28 per share.