The Channel logo

News

By | Shaun Nichols 6th June 2016 23:58

That didn't take long: Shareholders sue Oracle in 'fake cloud sales' row

Complaint accuses Big Red of mishandling finances

Just days after Oracle was sued by an ex-employee, who accused the IT giant of making up its cloud sales figures, its shareholders are now hauling the company into court.

A complaint [PDF] filed on behalf of Oracle stockholders by investor Grover Klarfeld alleges that the database goliath put their investments in the company at risk: Oracle's share price dropped four per cent – wiping $6bn off the value of the biz – when claims that the company inflated its cloud revenues emerged.

The lawsuit points the finger of blame for this dip at Oracle's top brass: supremo Larry Ellison, and co-CEOs Mark Hurd and Safra Catz.

"The defendants made materially false and misleading statements regarding the company's business, operational and compliance policies," the filing reads.

The complaint, filed in the Northern California District Court, goes on to reference the whistleblower suit filed against Redwood City-based Oracle by ex-staffer Svetlana Blackburn last week.

Blackburn, who also sued Oracle in the Northern California District Court, accused her former employers of violating the Sarbanes-Oxley Act by misrepresenting the revenues for Oracle's Cloud Computing operation.

Like the Blackburn case, the Klarfeld complaint would look to collect money from Oracle, in this case to be distributed to shareholders, should the IT giant in fact be deemed to have violated accounting laws. In additional to Oracle Corp, the complaint names Oracle chairman Larry Ellison and CEOs Safra Catz and Mark Hurd as defendants.

"Because of their positions of control and authority as senior officers, the Individual Defendants were able to, and did, control the contents of the various reports, press releases and public filings which Oracle disseminated in the marketplace during the Class Period concerning Oracle's results of operations," the complaint says of the execs.

While Oracle did not comment specifically on the Klarfeld complaint, the company has vigorously denied the allegations made by Blackburn and said that it would be fighting the case, including filing a counter-suit against Blackburn for damages caused from the claim. ®

comment icon Read 15 comments on this article or post a comment alert Send corrections

Opinion

Baby looks taken aback/shocked/affronted. Photo by Shutterstock

Kat Hall

Plans for 2 million FTTP connections in next four years 'not enough'
Microsoft CEO Satya Nadella
Stranded_ships

Chris Mellor

Thousands of layoffs announced as spinning rust enters its death spiral

Features

Locker room jocks photo via Shutterstock
Best locker-room strategy: Avoid emulating AWS directly
STRASBOURG, JUNE 29, 2016: The seat of the European Parliament. by Marco Aprile for shutterstock. EDITORIAL USE ONLY
Plan b, image via Shutterstock
EU workers, new markets: post-Brexit pressure on May & Co
Tough question, pic via Shutterstock