Oracle sues five Kitzhaber ex-campaign advisers

Published 12:00 am Saturday, February 28, 2015

The legal entanglement between Oracle and Oregon continues to thicken.

The latest lawsuit by Oracle America, filed in Multnomah County Circuit Court, seeks $33 million against five advisers to the re-election campaign of former Gov. John Kitzhaber for their alleged manipulation of the state’s failed website for Cover Oregon.

Oracle and Oregon already have dueling lawsuits over who is at fault — and who should pay — for what or what did not happen to the electronic marketplace that was to enable individuals and small businesses to shop for health insurance coverage.

The latest lawsuit, although it requests a jury trial, may be a prod toward discussions on an out-of-court settlement of the other lawsuits.

The latest lawsuit was filed after news disclosures of emails about the role of Kitzhaber’s political advisers leading to Kitzhaber’s call on May 29, 2014, for a state lawsuit against Oracle. His call followed his nomination for a fourth term in the May 20, 2014, primary, and Republican challenger Dennis Richardson’s targeting of the website’s failure.

Oracle America is incorporated in Delaware but is based in Redwood City, Calif.

Its lawsuit names Patricia McCaig, a political consultant to Kitzhaber and once chief of staff to Gov. Barbara Roberts; Scott Nelson and Tim Raphael, former Kitzhaber staffers, and Kevin Looper and Mark Wiener, political operatives at Fulcrum Political.

On behalf of the state, Attorney General Ellen Rosenblum did file suit against Oracle on Aug. 22 in Multnomah County Circuit Court. The state’s lawsuit seeks $200 million from Oracle, alleging fraud and racketeering against the company.

That suit came two weeks after Oracle sued Oregon in U.S. District Court for $23 million, alleging that the state’s incompetence led to the failure of the website.

Oregon now has switched to the federal website, and lawmakers have just completed action on a bill to end the public corporation that oversaw the health insurance exchange. Remaining functions of Cover Oregon will be transferred to the Department of Consumer and Business Services under the bill, which Gov. Kate Brown is expected to sign.

Kitzhaber resigned as governor Feb. 18 amid influence-peddling allegations against him and fiancée Cylvia Hayes.

In a related development, a Marion County circuit judge ruled last week that Oracle must continue to host Oregon’s Medicaid system for low-income patients for one more year. Oracle argued that it had no agreement to do so and did not want to continue to do business with the state.

Oracle’s revenues in 2014 were $38.3 billion, more than twice the $18.5 billion that Oregon plans to spend from its tax-supported general fund and lottery proceeds in the two-year cycle starting July 1.

pwong@PamplinMedia.com

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