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Oracle Pays $199.5 Million In Largest False Claims Act Settlement Ever

Oracle has agreed to pay $199.5 million (plus interest), for failing to meet its contractual obligations to the General Services Administration (GSA), the Justice Department said in a statement.  The settlement relates to a contract Oracle entered in more than a decade ago with the government to sell software licenses and technical support through the GSA’s Multiple Award Schedule (MAS) program.   (The MAS program provides the government and other GSA-authorized purchasers with a streamlined process for procurement of commonly used commercial goods and services). The government alleges that Oracle knowingly withheld information, because of which government entities accepted lower discounts, and ultimately paid far more than it should have for Oracle products.

The settlement resolves a lawsuit filed on behalf of the U.S. government by former Oracle employee, Paul Frascella, who will receive $40 million as his share of the recovery in the case.   Under the whistleblower provisions of the False Claims Act, private citizens can bring lawsuits on behalf of the United States and share in any recovery obtained by the government.

The Justice Department’s total recoveries in False Claims Act cases since January 2009 exceed $7.8 billion.

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