Oracle chief executive officer Larry Ellison has agreed to pay $122m (£78m) in a revised settlement with a group of Oracle shareholders, who accused him of wrongly selling shares in the company.
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The court-approved settlement with shareholders follows a lawsuit filed back in 2001, when Ellison was accused of selling shares shortly before the company announced a profits shortfall to the market.
The profits warning led to a devaluation in the company’s share price, but Ellison had by then received a higher price for the shares he previously sold.
Ellison originally offered to settle the case this September with a $100m donation to charities without admitting any wrongdoing. But this offer was not approved by the court as it didn’t include an estimated $24m in lawyers’ fees, which were set to be absorbed by Oracle.
This would have left shareholders therefore paying the bill, which the court said wasn’t fair. Ellison has now agreed to up the settlement to $122m to take care of most of the legal costs.
Ellison will now still pay charities $100m over a five-year period, with him deciding where the money will go, and he will pay the legal fees out of his own pocket.
Normally in cases where directors agree to compensate their firm and shareholders after alleged wrongdoing, the money is paid to the firm.
However, as Ellison owns a quarter of Oracle’s stock, a large chunk of the settlement money would have streamed back to him – hence the charitable donations instead.
Ellison won’t be left penniless after the settlement as he has an estimated $17bn fortune, according to Forbes magazine.