Oracle execs win ruling in insider-trading suit
Monday, November 22nd 2004, 10:03 am
News On 6
WILMINGTON, Del. (Dow Jones/AP) _ Oracle Corp. chief executive Lawrence Ellison and board chairman Jeff Henley have won a summary decision in a lawsuit that accused them of insider trading in 2001.
The decision was issued Wednesday by the same Delaware judge who is presiding over the continuing legal battle in Oracle's attempt to take over rival PeopleSoft Inc.
Vice Chancellor Leo Strine of Delaware's Court of Chancery found no evidence that Ellison and Henley dumped Oracle stock in advance of sliding results in 2001, and granted the two top executives summary judgment in the case.
Brought by a shareholder on behalf of Oracle to recover alleged insider profits, the 2001 case survived an earlier effort to block it when the Delaware Chancery Court found a special committee of the Oracle board lacked independence.
Wednesday's ruling, however, concluded there was no evidence showing either Ellison or Henley knew Oracle's profits were headed down when they sold stock in January 2001.
Strine, who will hear more evidence in Oracle's lawsuit against PeopleSoft's takeover defenses in December, noted in the shareholder case that the final week of a fiscal quarter is the definitive one for software companies.
PeopleSoft tried unsuccessfully last week to win a delay in the Oracle lawsuit, so it would be free to close fourth-quarter deals without the uncertainty of continued legal action.
In the decision on the 2001 case, Strine also noted the importance of software licensing to Oracle's profits.
For more than 17 months, Oracle has been attempting to bolster that licensing business by acquiring PeopleSoft.
PeopleSoft's continued ability to close deals and hit market earnings estimates with a looming takeover threat was central to its defense of antitakeover measures that Oracle is seeking to dismantle.