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id: 339, Created by Stan Vick Chase, Scout
10 May 2017Class period Start
20 June 2018Class period End
03 February 2023Claim deadline
In Oracle Corporation Litigation.
Oracle Corporation (ORCL) agreed to pay $17.5 million to settle a securities class action lawsuit accusing the Company of deceiving investors about the true drivers of the Company's cloud revenue growth.
The original complaint alleged that the Company issued false and misleading press releases, filings with the SEC, and statements during investor and analyst conference calls. Particularly, it alleged that:
- the Company and its Leaders misrepresented the true drivers of the Company's cloud revenue growth attributing the Company's revenue growth in its cloud segment to a variety of factors and initiatives, including, among other things, Oracle's "unprecedented level of automation and cost savings," as well as the Company being "customer-focused" and "intimate partners with our customer."
- According to the complaint, In truth, Oracle drove sales of cloud products using threats and extortive tactics. The use of such tactics concealed the lack of real demand for Oracle's cloud services, making the growth unsustainable and ultimately driving away customers. Among other things, the Company threatened current customers with "audits" of their use of the Company's non-cloud software licenses unless the customers agreed to shift their business to Oracle cloud programs.
The truth was revealed on March 19, 2018, when the Company disclosed that cloud revenue growth had stagnated and forecasted significantly slower sales growth for its cloud business than its competitors. Following these disclosures, analysts and market commentators connected Oracle's poor financial performance to its improper sales tactics. As a result of these disclosures, the price of the Company's stock declined significantly.
Oracle (ORCL) agreed to settle with investors to avoid further litigation.
City of Sunrise Firefighters’ Pension Fund, Union Asset Management Holding AG
Bernstein Litowitz Berger & Grossmann LLP (New York)
Northern District of California
Hon. Beth Labson Freeman
A.B. Data Ltd
Court hearing date
12 January 2023
+$17,500,000Total Settlement Amount