Oracle Pays $46 Million to Settle Kickback Lawsuit

By Cindy Waxer February 01, 2011

Oracle’s acquisition of Sun Microsystems is like the purchase that keeps on charging. The tech giant has agreed to pay $46 million to settle a lawsuit over alleged kickbacks to win government contracts, according to an article by the Associated Press.

The Department of Justice charged that Sun Microsystems, which Oracle acquired in January 2010, and other technology companies paid kickbacks to Accenture so that the systems integrator would recommend that federal agencies purchase Sun products amounting to hundreds of millions of dollars’ worth of contracts.

The legal settlement is a hefty inheritance given that Oracle purchased Sun Microsystems for $7.30 billion in January 2010. In September, Oracle announced plans to launch new products combining its software with that of Sun Microsystems.

In fact, reveals that among today’s server manufacturers, Gartner reports that Hewlett-Packard dominated the market with revenue increasing 22.5 percent in the quarter. Dell, on the other hand, witnessed revenue rise 25.6 percent while IBM and Fujitsu experienced a 9.9 percent and 5.2 percent uptick respectively.

Gartner reports that Oracle witnessed a 2.6 percent drop in server revenue. Nevertheless, Gartner’s findings point to overall growth for the entire tech industry. More and more high-tech companies are banking on increasing technology spent on hardware such as servers in recessionary times to drive revenue. In fact, Gartner has forecasted a 5.3 percent rise in global IT spending in 2010 to $3.4 trillion, after a 4.6 percent fall in 2009.

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Edited by Tammy Wolf

TechZone360 Contributing Editor

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