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Sun shareholders file suit to block sale to Oracle

Shareholders of Sun Microsystems Inc. filed three separate lawsuits last month in an effort to halt the company’s pending sale to Oracle, according to a filing Sun made with the U.S. Securities & Exchange Commission Friday.

The suits, filed in Santa Clara County, California, superior court, name Sun, some of its officials and Oracle as defendants, according to the filing.

All three actions are aimed at blocking the US$7.4 billion sale, alleging the price tag is “unfair and inadequate.” They also allege “claims for breach of fiduciary duty against the individual defendants and for aiding and abetting a breach of fiduciary duty against the corporate defendants,” the filing states.

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The defendants have yet to file answers to the complaints, according to Sun. More information about the lawsuits wasn’t immediately available Friday.

Oracle announced its plans to buy Sun in April, after reported talks between IBM and Sun fizzled.

Sun also said in the filing that it may have broken the U.S. Foreign Corrupt Practices Act during fiscal 2009. The law is meant to stop companies from bribing foreign officials. Sun said it has started an independent probe into suspect activities in a “certain foreign country” and “took remedial action,” as well as made a voluntary disclosure to U.S. authorities.

Meanwhile, Sun has decided to put the brakes on an effort to consolidate its database infrastructure into a single global ERP (enterprise resource planning) system.

Sun has “experienced a number of challenges” during the project that have affected operations, according to the filing.

“During the next six months, we have decided to delay the implementation of the remaining phases of the project while we evaluate alternatives,” Sun said.

A Sun spokeswoman said the company “intends to respond appropriately to the lawsuits” but otherwise declined comment.

An Oracle spokeswoman declined to comment on the suits, but provided a statement saying that Sun had disclosed its potential violations of the FCPA prior to the acquisition agreement.

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