Oregon & Oracle reach settlement worth more than $100 million

In a press release from the Oregon Department of Justice, Governor Kate Brown and Attorney General Ellen Rosenblum today announced a global settlement of the litigation between Oregon and Oracle, which includes cases Rosenblum v. Oracle, Oracle v. Governor Kate Brown, Oracle v. Oregon by and through Governor Kate Brown, and Oracle v. Oregon Health Insurance Exchange Corporation.

The settlement, valued at more than $100 million, includes cash payments to Oregon as well as a six-year Unlimited License Agreement (ULA) for products and services that can be leveraged by the Legislature to significantly modernize state government's IT systems, potentially saving the State hundreds of millions of dollars.

"Today's settlement agreement ends years of turmoil and taxpayer expense related to a troubled health exchange program I dissolved in March 2015,” Governor Brown said. “Since the demise of Cover Oregon, we have helped nearly 98 percent of Oregon children and 94 percent of adults obtain health care coverage – now, let’s focus on getting to 100 percent."

In addition to the ULA, the agreement includes $60 million in free customer service support, a $10 million grant for science, technology, engineering and math (STEM) programs in Oregon schools, and $25 million to reimburse Oregon for litigation costs. Through this settlement, all legal actions related to the failure of Oregon’s health exchange are dismissed with prejudice.

“I want to thank the teams from Oregon and Oracle who have worked so hard to find a way to put this unfortunate episode behind us,” said Attorney General Rosenblum. “This settlement outcome is a "win-win" for the people of Oregon—without the expense and continued impact on our collective psyche. But, the beauty of the deal is that if we choose to take full advantage of the free ULA's, we are uniquely situated to modernize our statewide IT systems over the next six years—something we could not otherwise afford to do. It is a creative solution that allows us to take advantage of Oracle's suites of products that already serve several Oregon state agencies well, and are used by the majority of other state governments.”

Oracle has also granted the State of Oregon an exclusive, cost-free 6-year ULA that will expire in 2020 for perpetual software licenses for business enterprise software packages that the state government needs. Many of these products, in use in many other states, have never been implemented in Oregon because of their high cost.

During the 6-year period of the ULA, state government will also receive free software updates and customer support for the products Oregon selects. The software available under the ULA at no cost to the State includes:

• PeopleSoft Enterprise ERP suite, a comprehensive set of integrated end-to-end business software packages, including Financial Management, Supplier Relationship Management, Enterprise Service Automation, Human Capital Management, and Customer Relationship Management. 

• Hyperion Enterprise Financial Planning suite, a portfolio of software packages focused on improving financial management, reporting and analysis. The suite includes products designed to assist financial management, budgeting, planning, financial forecasting, financial reporting, database management, and business intelligence.  

• Business Intelligence suite is set of software tools designed to enable interpretation of large volumes of data by providing analytics and insights that empower data-driven decision-making. The suite includes products that enable business performance management, statistical analysis, and data visualization.

Depending on how many of the software packages the State utilizes under the five-year agreement and legislative support for implementation resources, the software obtained under the agreement could provide state government with substantial IT upgrades at an enormous savings. All of the software available under the ULA are programs state government has not had the resources to buy but are necessary to modernize core business functions.

“Oregonians expect quality customer service from their state government, but many of our state agencies are hampered by outdated technology from the 1980’s,” said Alex Pettit, Chief Information Officer for the State of Oregon.  “The suite of software made available through this settlement gives the State the opportunity to upgrade those systems to a more modern platform and serve Oregonians in a cost-effective and efficient manner.”

Oregon has existing agreements with Oracle for support and products that are currently being used throughout government, and the settlement would not affect these existing agreements.

In addition to the software agreement, customer service, and reimbursement of Oregon’s litigation costs, Oracle will make a $10 million grant to the Oregon Community Foundation to fund science, technology, engineering, and math (STEM) education initiatives in Oregon K-12 schools.

“I am pleased we were able to channel millions of dollars into science, technology, engineering, and math education all over the state,” Governor Brown said. “Investing in STEM education pays off in the form of more Oregon students excelling in the sciences, awakening them to the power of their own potential.”

The State of Oregon was represented by Markowitz Herbold PC.

Contact:

Kristina Edmunson, Department of Justice, Kristina.Edmunson@doj.state.or.us, 503-378-6002

Kristen Grainger, Governor’s Office, Kristen.Grainger@oregon.gov, (503) 339-6018