Class action suits target Oracle’s acquisition of Sun

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Three class action suits have been taken out against Sun Microsystems, seeking to halt its acquisition by Oracle.

At the same time, Sun is investigating some of its employees who are under suspicion of bribing foreign officials.

In its quarterly earnings filing, released late last week, it stated: “Three putative shareholder class actions were filed by individual shareholders… naming Sun and certain of our officers and directors, as well as Oracle Corporation, as defendants.”

“The complaints, which are similar, seek to enjoin the proposed acquisition of Sun by Oracle Corporation [and] generally allege that the consideration offered in the proposed transaction is unfair and inadequate.”

It was initially thought that IBM would buy Sun, but Oracle came in late in the day to pick up the company for $7.4 billion (£5.08 billion). However, even with Oracle's chief executive Larry Ellison promising to keep Sun’s hardware as well as its engineering team, some shareholders from the Sun camp are clearly unhappy.

Sun also gave a bit more detail about its investigation into its own staff. It stated in the quarterly results: “During fiscal year 2009, we identified activities in a certain foreign country that may have violated the Foreign Corrupt Practices Act (FCPA). We initiated an independent investigation with the assistance of outside counsel and took remedial action.”

“The outcome of these, or any future matters, cannot be predicted.”

It did state that punishments could include fines, criminal sanctions and “debarment from doing business with the US federal government in connection with FCPA violations” which the company admitted could clearly damage its future business.

A spokesperson from Sun told IT PRO: "Sun can confirm that a class action lawsuit was filed against the Company in connection with the Oracle transaction. Sun intends to respond appropriately to the lawsuit. At this time, Sun cannot comment on any details regarding pending litigation."

Oracle declined to comment.

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