Oracle America Inc. will pay $46 million to settle claims that Sun Microsystems Inc., which merged with Oracle last year, paid kickbacks to consulting companies in exchange for recommendations that federal agencies buy its products, the Justice Department announced today.
The settlement resolves allegations under the False Claims Act and Anti-Kickback Act that in the late 1990s, Sun knowingly gave false or incomplete information to government contracting officers, who then paid too much for Sun’s products as a result.
The agreement is the latest in a string of similar settlements between technology companies and the federal government. The Justice Department said it’s continuing to investigate government technology vendors.
Last year, Hewlett-Packard Co. paid $55 million to settle similar allegations, and in another similar case, Cisco Systems Inc. and Westcon Group North America paid $48 million to settle charges that the companies made misrepresentations during contract negotiations with the federal government.
“Kickbacks, illegal inducements, misrepresentations during contract negotiations – these undermine the integrity of the government procurement process and unnecessarily cost taxpayers money,” U.S. Assistant Attorney General Tony West said in a statement. “As this case demonstrates, we will take action against those who abuse the public contracting process.”
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