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Oracle Will Pay $46M to Settle Sun’s Problems

(CN) - Software giant company Oracle America will pay the United States $46 million to settle charges that Sun Microsystems, which Oracle acquired in 2010, paid kickbacks and submitted false claims, federal prosecutors said.

Sun Microsystems allegedly paid kickbacks to systems integrator companies in return for recommendations that federal agencies buy their products. Authorities say they have reached six settlements as part of an ongoing investigation of government technology vendors.

Oracle swept in to merge with Sun in 2009 for $7.37 billion, elbowing out International Business Machines, which had hoped to take over the struggling Sun. The merger talks, and IBM's ultimate disappointment, allegedly spawned the largest insider trading ring in history.

"Kickbacks, illegal inducements, misrepresentations during contract negotiations - these undermine the integrity of the government procurement process and unnecessarily cost taxpayers money," Tony West, assistant attorney general for the Justice Department's civil division, said in a statement Monday. "As this case demonstrates, we will take action against those who abuse the public contracting process."

Whistleblowers Norman Rille and Neal Roberts first claimed that Sun engaged in kickbacks in an action they filed in an Arkansas District Court in 2004. Authorities intervened in 2007, adding claims that Sun defectively priced its contracts with the General Services Administration.

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