Oracle's Ellison spanked for withholding evidence in shareholder suit
The missing Softwar tapes
A federal judge has upbraided Oracle CEO Larry Ellison for withholding evidence in a class-action suit brought by company stockholders.
Yesterday, Bloomberg reports, US District Court Judge Susan Illston ruled that Ellison failed to preserve or intentionally destroyed emails and audio recordings that should have been turned over to the suit's plaintiffs. She stopped short of sanctioning the world's fourteenth richest man, but she did say that jurors should assume the missing evidence would have the boosted the stockholders' case.
According to Illston's ruling - provided here (PDF) by the Wall Street Journal - Ellison was obligated to preserve his emails after the suit was filed in March 2001. But in the end, he gave the court only 15 messages.
Ellison and his Oracle co-defendants did produce 1,650 Ellison emails from the files of other company employees. But the judge says this merely muddied the waters.
"It could have been helpful to plaintiffs to demonstrate that certain emails were discovered in Ellison's files," Illston wrote. "Otherwise, for instance, Ellison could argue that he never actually read or received an email that was sent to him, and thus had no knowledge of its contents.
"Moreover, having established with certainty that numerous emails were not produced from Ellison's email files - because the emails were produced from other files or accounts - it is impossible to know whether additional unproduced emails were also deleted or not turned over."
The defendants also requested 135 hours of Ellison interviews recorded by Matthew Symonds, author of the book Softwar: An Intimate Portrait of Larry Ellison and Oracle. But, says the judge's ruling, Symonds asked a computer repair shop to destroy the laptop storing the interviews.
Ellison did hand over some transcripts of the interviews, but none from 2001. With their suit - originally brought by the Nursing Home Pension Fund - shareholders accuse Oracle, Ellison, and other execs of falsifying financial results for the company's 2001 second and third fiscal quarters.
"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 [Oracle software] Suite 11i, the effects of the economy on Oracle's business and problems with defendant's forecasting models,'" Illston said.
Trial in the case is scheduled for March. Ellison settled a similar shareholder suit in 2005, donating $100m to charities and forking over $22m in attorney fees. ®
Sponsored: RAID: End of an era?