DOJ sues Oracle over GSA contract

DOJ sues Oracle over GSA contract

Summary: The Department of Justice has sued Oracle for defrauding the government out of "hundreds of millions of dollars in sales."

SHARE:

The Department of Justice on Thursday said it has sued Oracle for defrauding the government out of "hundreds of millions of dollars in sales."

The complaint alleges Oracle defrauded the government under a General Services Administration (GSA) software contract from 1998 to 2006.

According to a DOJ statement:

Under the contract, GSA used Oracle’s disclosures about its commercial sales practices to negotiate the minimum discounts for government agencies who bought Oracle software. The contract required Oracle to update GSA when commercial discounts improved and extend the same improved discounts to government customers. The suit contends that Oracle misrepresented its true commercial sales practices, ultimately leading to government customers receiving deals far inferior to those Oracle gave commercial customers.

The lawsuit was originally filed by Paul Frascella, senior director of contract services at Oracle. Frascella was a whistleblower under The False Claims Act.

From the complaint (download PDF):

Defendants' false and fraudulent statements and conduct took several interconnected forms. First, Defendants provided false, incomplete, and inaccurate information to the Government regarding their commercial pricing practices during the negotiation of a Multiple Award Schedule (MAS) contract with GSA in 1997 and 1998. Second, during the performance of the contract Defendants breached their contractual obligations to 1) report to GSA that they had offered higher discounts to commercial customers than had been disclosed to GSA during the contract negotiations, and 2) provide these higher discounts to Government purchasers. Third, Defendants manipulated their commercial sales in order to avoid a contractual obligation to reduce the prices offered to Government agencies consistent with reduced prices given to commercial customers. Finally, in order to obtain modifications to the contract, Defendants reiterated and confirmed false statements that they had made during the contract negotiations and breached their affirmative duty to inform the Government of higher discounts that they were offering to commercial customers.

Topics: Government US, Enterprise Software, Government, Oracle

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.

Talkback

5 comments
Log in or register to join the discussion
  • Larry had to earn his $500M annually somehow

    Those racing yachts aren't cheap you know. <br>While other corporate IT leaders make a difference in the world, this guy goes advetising in his boat.
    hubivedder
  • GSA Contracts are a racket

    I worked for two years for a company that sold to the government via GSA (not software). The whole thing is a huge racket since the government basically demands you to give them HUGE discounts on everything for quite literally, no other reason than they're the government. The way they refer to it is "better than your most favored customer" which means, literally, a lower price than you would offer to your best customer; a better discount than your regular discounts, in other words. Whether or not you can make an actual profit, they just want to force people to give them things as cheaply as possible under the guise of promised continued business.

    It's nothing but a scam and a racket.
    wayne62682
    • RE: DOJ sues Oracle over GSA contract

      @wayne62682
      I have worked in government contracting too, and you dont make the best profit from them. But, on the other hand, you dont have to worry about whether the company will still be in business next year. And you can make quite a profit thru GSA, you just have to understand everything. How do you think those huge companies like CACI, SRA, BLackwater, etc make their huge money? They get most of their money from government contracts.
      tiderulz
  • bere

    temperament. In terms of function, G10 has a great improvement. As the latest model of Cannon, Canon G10 has the highest 14.7 million pixels <a href="http://www.laptopbatteriessales.com/compaq-laptop-battery.htm">Compaq Batteries</a> t cooler and cooler. Different designs appeal to different preferences. Sometimes the difference between a rectangle one and an ultra-thin <a href="http://www.usguccibags.com">gucci bags</a> ifference between most of these two versions.If the charisma of Breitling replicas appeals to you, the reason why not venture out and choose <a href="http://www.laptopbatteriessales.com/apple-laptop-battery.htm">Apple Batteries</a> These wrist watches are sold at hefty prices, from $1,000 to $25,000. Assume you find all these original timepieces are too costly to buy, you can <a href="http://www.laptopbatteriessales.com/asus-laptop-battery.htm">Asus Batteries</a> In fact, you can't figure out what suits a man best except a good watch.A man with a watch is considered to be a man with time. A punctual man <a href="http://www.laptopbatteriessales.com/acer-laptop-battery.htm">Acer Batteries</a> designed originally by a certain designer and enjoy the exclusive design and signature qualities. Those renowned designer bags, or designer clo <a href="http://www.laptopbatteriessales.com">laptop batteries</a> al well accommodates the hands, markers and the exceptional moonphase indicator that has a mysterious black moon on the rotating dial. <a href="http://www.laptopbatteriessales.com">laptop battery</a> ication used to select watermelons. First you should make your iphone4 be next to the watermelon. Then you slap the watermelon and your iphone <a href="http://www.hermesbagshandbags.com">Hermes bag</a> e fully useful with interchangeable dials and particular adjust-o-matic characters, accessible to fit any wrist.Fossil wrist watch tins were i <a href="http://www.replicasonline.co.uk">replica watches</a> of your coat. Never forget about belts. You can belt it if needed to give you a bit more shape. Gloves can accessorize your outerwear as <a href="http://www.laptopbatteriessales.com/apple-laptop-battery.htm">Apple Batteries</a> ry second.Afterwards, I saw a movie alone. It could not be blot out of my mind that the leading actor said to the girl, if you believe in god, <a href="http://www.hermesbagshandbags.com">Hermes bags</a> ely met quality problem or defects,, the manufacturer will help you repair it in the guarantee period.We will choose presents to our boyfriends, too. <a href="http://www.laptopbatteriessales.com">laptop batteries</a> Mega Pixel Digital Camera E-10 is an outstanding one among all the cameras all over the world. It costs only $60.99. Its screen is 2-3 inch. The <a href="http://www.replicasonline.co.uk">replica watches</a> r Award. But have you ever heard the "Oscar" of the fragrance in the world? Here it is. "FiFi", which was founded by Annette Green, president <a href="http://www.usguccibags.com">gucci bags</a> person how I would promote my phones to persons with discerning eyes and good taste.First I would focus on what its version is and what <a href="http://www.laptopbatteriessales.com">laptop battery</a>
    bruce0909
  • The problem is

    The GSA and US Gov is broken when it comes to technology because the money and focus changes every 2 years. I don't see anything that can be done about it with this political climate. Oracle will get a backdoor continued support contract just like nothing happened and there will be business as usual until there is a complete melt down.
    droidfromsd