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Oracle hit with whistleblower lawsuit over cloud accounting
[NEW YORK] Oracle Corp was sued on Wednesday by a former senior finance manager who claimed she was terminated in retaliation for complaining about improper accounting practices in its cloud services business.
Shares of Oracle fell about 2.6 per cent to US$39.23 in after-hours trading.
In a complaint filed with the US District Court in San Francisco, the former executive, Svetlana Blackburn, accused upper management of trying to push her to "fit square data into round holes" to make Oracle Cloud Services' results look better.
"We don't agree with the allegations and intend to vigorously defend the matter," said Oracle spokeswoman Deborah Hellinger.
The Redwood City, California, company has come under considerable pressure from younger companies such as Salesforce.com Inc, the leader in enterprise cloud-software services.
Like other established technology companies, Oracle has been moving its business to the cloud - essentially large servers in data centers accessible through the internet - instead of selling installed software.
It has invested aggressively in its cloud business over the last few years in a bid to gain market share from rivals such as Salesforce.com and Workday Inc.
Safra Catz, Oracle's co-chief executive, said in March that the cloud business was in a "hyper-growth phase."
Ms Blackburn said her bosses instructed her to add millions of dollars of accruals for expected business "with no concrete or foreseeable billing to support the numbers," and that executives above her added accruals on their own.
Ms Blackburn said Oracle terminated her employment last Oct 15, just one month after the alleged wrongdoing began, and two months after she received a positive performance review.
Oracle, she said, had come to view her as "more of a roadblock than a team player who would blindly generate financial reports using improper bases in order to justify the bottom lines that her superiors demanded to see." VJ Chetty, a lawyer for Ms Blackburn, declined additional comment.
Ms Blackburn's lawsuit accused Oracle of violating the anti-retaliation provisions of the federal Sarbanes-Oxley corporate governance and Dodd-Frank financial reform laws. It seeks punitive damages, double back pay, and other remedies.