Whistleblower Lawsuit Next on Oracle’s Docket

After recently losing major lawsuits to Google (NASDAQ: GOOGL) and Hewlett-Packard (NYSE:HPE), Oracle Corp. (NYSE: ORCL) still must deal with the fallout from a whistleblower lawsuit filed last month in U.S. District Court for the Northern District of California. Over the past month, the case has spawned a separate securities class action and an ERISA class action.

The whistleblower complaint alleges that Oracle last year fired Svetlana Blackburn, a senior finance manager, after she resisted preparing unlawful accounting entries and warned her supervisor that she would inform authorities. The complaint claims Oracle violated the whistleblower protection provisions of the Sarbanes-Oxley Act, the Dodd-Frank Act, and the California Labor Code. Blackburn is seeking compensatory damages for lost earnings and benefits, special damages for emotional distress, and punitive damages.

To prevail, Blackburn doesn’t have to prove that Oracle violated securities laws as long as she reasonably believed that a violation would occur. Instead, she must prove that her termination resulted at least partly from telling her supervisor that she planned to report the allegedly unlawful activity. If she succeeds, Oracle can avoid liability only by proving that it would have fired Blackburn regardless of her plans to blow the whistle.