Sun Reveals It May Have Broken International Bribery Laws

By Chris Preimesberger  |  Posted 2009-05-11 Print this article Print

The company did not specify where or when the illegal activity took place or who may have committed the infraction. Oracle, which intends to acquire Sun and doesn't appear to be worried, said it knew about the report before it tendered its $7.4 billion offer.

Sun Microsystems admitted in its quarterly earnings report that it may have broken international anti-bribery laws in an incident that happened outside the United States.

The Santa Clara, Calif.-based IT systems company did not specify where or when the illegal activity took place or who may have committed the infraction.

Although there is no indication at this time how serious the potential offense might be, it apparently is not enough to worry enterprise database maker Oracle, which announced April 20 that it intends to acquire Sun. Oracle said it knew about the report before it tendered its $7.4 billion offer to Sun's board of directors.

In its first-quarter earnings report on April 28, Sun reported that it found "potential violations" of the Foreign Corrupt Practices Act of 1977, which prohibits publicly traded U.S. companies from bribing foreign government officials to get an inside track on obtaining new business.

The company did not reveal any other details of the incident in the first-quarter report, except that it "took remedial action" and alerted the Justice Department and the Securities and Exchange Commission as required by law.

If a violation is found, legal remediation can range from a fine to criminal charges to a potential block on working with federal government agencies-for decades a major source of Sun's revenue.

The story first came to light in a report in the Wall Street Journal May 8. A Sun spokesperson had no comment.


Chris Preimesberger Chris Preimesberger was named Editor-in-Chief of Features & Analysis at eWEEK in November 2011. Previously he served eWEEK as Senior Writer, covering a range of IT sectors that include data center systems, cloud computing, storage, virtualization, green IT, e-discovery and IT governance. His blog, Storage Station, is considered a go-to information source. Chris won a national Folio Award for magazine writing in November 2011 for a cover story on and CEO-founder Marc Benioff, and he has served as a judge for the SIIA Codie Awards since 2005. In previous IT journalism, Chris was a founding editor of both IT Manager's Journal and and was managing editor of Software Development magazine. His diverse resume also includes: sportswriter for the Los Angeles Daily News, covering NCAA and NBA basketball, television critic for the Palo Alto Times Tribune, and Sports Information Director at Stanford University. He has served as a correspondent for The Associated Press, covering Stanford and NCAA tournament basketball, since 1983. He has covered a number of major events, including the 1984 Democratic National Convention, a Presidential press conference at the White House in 1993, the Emmy Awards (three times), two Rose Bowls, the Fiesta Bowl, several NCAA men's and women's basketball tournaments, a Formula One Grand Prix auto race, a heavyweight boxing championship bout (Ali vs. Spinks, 1978), and the 1985 Super Bowl. A 1975 graduate of Pepperdine University in Malibu, Calif., Chris has won more than a dozen regional and national awards for his work. He and his wife, Rebecca, have four children and reside in Redwood City, Calif.Follow on Twitter: editingwhiz

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