Oracle Seeks Federal Help Against Oregon

WASHINGTON (CN) - Software giant Oracle sued the U.S. Department of Health and Human Services this week, in more fallout from the failure of Oregon's health insurance exchange website and the resulting fiasco.

Oracle America wants the HHS to investigate allegations of fraud and misuse of federal funds. It said in a statement that federal intervention is needed because Oregon is "hopelessly and irreparably conflicted in any litigation, both as the grant recipient and due to credible evidence and admissions of its own culpability in the failure of the exchange."

The debacle of the failed rollout of Oregon's Affordable Care Act health insurance exchange website, Cover Oregon, has led to complex and costly litigation in multiple venues.

Oracle was the technology contractor for Cover Oregon. Despite receiving $305 million in federal money, the website never fully worked.

Oracle sued Oregon in 2014 for $23 million in unpaid fees, and the state countersued for breach of contract.

The company and state have exchanged fire in court for two years. Oregon Attorney General Ellen Rosenblum accused the company of "hiding from the state the true extent of Oracle's shoddy performance ."

Oracle fired back in January this year, claiming it entered a settlement agreement with Gov. Kate Brown's former chief of staff, which the state never enforced.

Rosenblum denied there had been a settlement, as only the attorney general had the power to make such a deal. She called the settlement an "entire figment of their imagination and designed to protect their bosses at the highest level."

Oracle's newest lawsuit, Tuesday in Federal Court, seeks writ of mandamus ordering HHS Secretary Sylvia Mathews Burwell to investigate the fiasco.

"To date, HHS has taken no action to address either Oregon's misuse of federal funds or its conflict of interest-infested usurpation of the federal government's obligation to enforce the ACA's prohibitions against waste, fraud and abuse," the complaint says.

Oracle says Oregon terminated Cover Oregon "for purely political reasons" and then sued Oracle "to cover up that decision and evade its own liability."

The state is not a defendant in new, 55-page complaint, only Burwell and the HHS.

Oracle said in a statement that the new lawsuit "draws upon e-mails showing that former Governor John Kitzhaber's political appointees illegally hijacked decision-making authority from the Board of Directors of Cover Oregon, the fiduciary of ACA funds and the grant recipient."

Its lead attorney is Seth Rosenthal, with Venable LLP.

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