Judge rules Oracle withheld Ellison e-mails

Oracle deliberately destroyed or withheld CEO Larry Ellison's e-mails and failed to preserve audio recordings sought as evidence in a class-action lawsuit filed against the software maker, a federal judge has ruled.

Oracle CEO Larry Ellison

(Credit: Dan Farber/CNET News)

U.S. District Judge Susan Illston in San Francisco said Tuesday that Oracle willfully withheld tapes and transcripts of interviews that a journalist conducted with Ellison in 2001 and 2002 while researching a book about the Oracle founder called Softwar. The recordings and transcripts were stored on laptop by the author, Matthew Symonds, who directed a computer repair shop to destroy the laptop in late 2006 or early 2007, Illston said.

The lawsuit alleges the software giant made false statements about the company's financial condition in the second quarter of 2001 and made false statements about its Suite 11i business management software. The suit, filed by shareholders who held the stock when its price fell after the company reported disappointing results, also claims Ellison knew about the problems and sold about $900 million in stock before investors were told of the problems.

Ellison and Oracle knew the material was potentially relevant to claims that they made false statements about the company's 2001 second-quarter financial results and problems with the software suite, Illston said.

"The court believes it is appropriate to infer that the e-mails and the Softwar-related materials would demonstrate Ellison's knowledge of, among other things, problems with the Suite 11I, the effects of the economy on Oracle's business and problems with defendant's forecasting models," Illston said in her ruling.

Illston said the jury in the case will be instructed to assume that Ellison knew about the problems at Oracle before they were disclosed to investors. The judge also said she would take that assumption into account when deciding whether to rule in favor of investors on their claims and Oracle's requests to dismiss the case.

The case is scheduled to begin on March 30.

An Oracle representative could not immediately be reached for comment.

[humanssssss]

Steve Jobs and Larry Ellison are friends. Both of them cheat. I hate cheaters. It's a like poker game when the cards were marked and I can never seem to win until I found out. By then, I have no money left to play. These fckers need to go to jail. It's already hard to compete in an honest game. It is near impossible to compete when the players are cheating. Take them out and punish them severely!

Investigate Steve Jobs too. He backdated stock options at both Pixar and Apple. That guy is a criminal.

[joetesta70]

Yea! Right on!

[ralfthedog]

Backdating is not illegal. It is a common practice. In some cases it is the only fare way to do business. Steve Jobs was told that the board of directors had approved the backdate of the options. The day he found out the CFO had lied about the board (and forged signatures of board members) he fired the CFO, and called the SEC to report the violation. He never executed the option (even after the board retroactively approved the backdate). If he had chosen to execute the option he would have made quite a bit of money.

This should be used as an example in every business school in the world as how to handle this kind of action.

All I can say is "Right on Steve, good job!"

[zclayton2]

Let me ge this straight. A journalist author who had interview transcripts from 2000-2001 on his personal laptop had the research notes for his published book destroyed for unknown reasons in 2006 or 2007. Exactly how and why are Oracle and Ellison responsible for this? When was the lawsuit filed and discovery initiated? Were the authors notes suppeonaed and is the author charged with anything? This makes no sense as presented in the article other than alleged destruction of emails.