Court Revives Oracle Shareholders Action
Citing suspicious insider stock sales, public boasting by executives and overly rosy financial forecasts, an appeals court reinstated a class action lawsuit filed by angry shareholders against Oracle and top executives.SAN FRANCISCO (AP)Citing suspicious insider stock sales, public boasting by executives and overly rosy financial forecasts, an appeals court Wednesday reinstated a class action lawsuit filed by angry shareholders against Oracle Corp. and top executives. The U.S. Ninth Circuit Court of Appeals said that chief executive Larry Ellisons nearly $900 million stock sale a month before the company announced disappointing financial results was "suspicious." In addition, the three-judge panel cited Ellisons public boasts in 2000 that the company was impervious to a slumping economy and subsequent rosy sales forecasts that didnt pan out in early 2001 as reasons the shareholder suit should continue. Oracle spokeswoman Deborah Lilienthal said in a prepared statement, "We believe that the allegations in that complaint are wholly unsupported by any evidence and we are confident that Oracle will prevail when the litigation is concluded."
A lower court judge had earlier tossed out the complaint, saying the shareholders had not proven that Ellison and other Oracle officials knowingly lied about the companys financial situation between Dec. 15, 2000 and March 1, 2001.