N.Y. state pension fund sues Oracle for political donor info

Reuters News
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Posted: Oct 28, 2015 2:25 PM

By Tom Hals

(Reuters) - New York state's public pension fund has sued Oracle Corp to force the tech giant to reveal how it spends its political donations, according to a court filing.

The New York State Common Retirement Fund, which manages $184.5 billion, has been urging large public companies to disclose political donations. It said more than 142 S&P 500 companies have done so, but Oracle has so far declined.

Three years ago, the fund brought a similar lawsuit, which was the seen as the first of its kind, that eventually forced wireless chip company Qualcomm Inc to disclose its political expenditures.

The fund, which said it owns $380 million of Oracle stock, filed its lawsuit late Tuesday in the Court of Chancery in Delaware, where Oracle is incorporated.

According to the complaint, Oracle executives including co-founder and Executive Chairman Larry Ellison are major political donors, raising concerns that corporate funds may be spent in ways that harm stockholders.

"Whether willfully or innocently, the same executives may allow personal political viewpoints and preferences to influence the decisions whether and how to allocate corporate funds in the political arena," said the complaint.

An Oracle spokeswoman declined to comment.

The lawsuit comes as both political parties gear up for the 2016 presidential election, expected to be the costliest ever.

Political spending has risen dramatically since the U.S. Supreme Court's Citizens United ruling in 2010 essentially lifted restrictions on political donations by corporations and unions.

The New York pension fund is overseen by state comptroller Thomas DiNapoli, a Democrat.

The complaint said research shows that companies that spend heavily on political contributions often perform poorly. Oracle, the world's biggest database firm, is struggling to move its business toward an Internet-enabled model. Its shares are down about 14 percent this year.

The lawsuit cited as a potential concern Ellison's fundraising for Republican presidential candidates, Florida Senator Marco Rubio and Kentucky Senator Rand Paul.

Oracle had in 2007 reached an agreement with shareholder activists to disclose political contributions.

But the lawsuit charges that the company violated that accord last year by failing to identify the person deciding political donations, or disclose whether corporate funds were channeled through intermediaries such as trade groups. The pension fund said Oracle refused its request for that information.

The case is New York State Common Retirement Fund v Oracle Corp, Delaware Court of Chancery, No. 11642.