Oracle Settles Actions Over Inflated Revenue

     SAN FRANCISCO (CN) — Oracle this week quietly ended two class actions claiming that the company lied about its cloud services revenue to artificially inflate its stock price, but still faces claims by a former senior accountant who blew the whistle on the alleged fraud.
     Former Oracle finance manager Svetlana Blackburn sued the Redwood City-based software giant in Federal Court in June, claiming Oracle fired her last October for refusing to fudge financial reports and threatening to expose the scam.
     Blackburn said she was ordered to add millions of dollars in unsupported revenue from Oracle’s cloud services to financial reports, knowing the false numbers would be “used to paint a rosier picture than actually existed” in SEC filings and earnings calls.
     After she lodged her complaint, two class actions were filed against the company.
     Investor Grover Klarfield sued Oracle on securities fraud claims on June 2.
     Former Oracle employee Joseph Tomassini then sued the company on claims it made imprudent investments with its employees’ retirements savings plan dollars on June 24.
     On Tuesday, both plaintiffs voluntarily dismissed their class actions. Attorneys for Klarfield and Tomassini did not return multiple phone calls seeking comment on the dismissals on Tuesday and Wednesday.
     Despite ending the two class actions, Oracle must still face Blackburn’s claims of wrongful termination and whistleblower retaliation.
     In a court document filed earlier this month, Oracle said it fired Blackburn due to “ongoing performance issues” and not because she threatened to expose the company’s fraudulent accounting practices.
     When reached by phone, Oracle attorney Kenneth Herzinger would not say whether the two dismissed class actions were settled out of court.
     The Oracle attorney deferred all comments to the company’s public relations team. Oracle spokeswomen Deborah Hellinger and Jessica Moore did not return phone calls seeking comment on Tuesday and Wednesday.
     Klarfield is represented by Jennifer Pafti of Pomerantz in Beverly Hills.
     Tomassini is represented by Patrice Bishop of Stull, Stull and Brody in Beverly Hills.
     Herzinger is with Orrick, Herrington & Sutcliffe in San Francisco.

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