Larry Ellison hands back $575m from Oracle's Pillar slurp
CEO settles case over alleged conflict of interest
Oracle chief exec Larry Ellison has agreed to waive a potential payout of $575m to clear up accusations of a conflict of interest over Oracle's acquisition of Pillar Data Systems, a company Ellison owned.
Ellison agreed to hand back over 95 per cent of an "earn-out" payday he got when Oracle slurped Pillar in 2011, after two pension funds claimed in court that the company's directors had used its funds to bail Ellison out of a "horrible investment" in Pillar.
They accused Oracle of violating its duties to shareholders by buying the data storage firm, according to court documents seen by Bloomberg and Reuters.
Ellison owned 55 per cent of Pillar and was due to be paid for his share of the firm in an agreement based on Pillar's performance over the next three years. Oracle argued that the deal was structured like this specifically to ensure that Ellison didn't benefit improperly from the acquisition.
But the company said it had decided to settle out of court "after weighing the costs and uncertainties of continued litigation against the benefits of the settlement".
The settlement comes just a day after the company was forced to defend Ellison's pay cheque at Oracle against criticism from CtW Investment Group, which represents pension funds. ®