A claim against Oracle-owned Netsuite was recently settled out of court following private mediation with a customer that alleged the vendor oversold and under-delivered on software.

In a court document [PDF] released last week, a California judge dismissed River Supply Inc's (RSI) claim against Oracle and NetSuite. At the same time, Oracle's defense was also dismissed.

RSI, a Pennsylvania-based architectural construction material supplier, arranged a private mediation session with Oracle to take place in August, court documents state.

Filing its initial complaint last year, RSI alleged Oracle had conducted a "widespread fraudulent scheme and unfair business practice" in sales of NetSuite software while failing to "provide all the functionality at the price promised" in a project that began in 2021 to replace financial, commerce, and payroll software.

In the court documents, Oracle was accused of breaching its agreement with RSI by "failing to implement a workable ERP solution and failing to perform the services in a professional manner consistent with industry standards, and as was represented by Oracle."

In November 2023, Oracle succeeded in having most of the allegations dismissed, including those of fraud. However, the judge did not dismiss RSI's claim that Oracle breached its contract by failing to deliver workable software on time.

This year in February, the judge allowed RSI to submit an amended fraud claim. Laurel Beeler, United States Magistrate Judge in the District Court, Northern District of California, dismissed RSI's claims of a breach of the implied covenant of good faith and fair dealing as well as its claim under California's Unfair Competition Law (UCL). However, the court denied Oracle's motion to dismiss the fraud claim.

A second amended claim alleged Oracle customers were expected to sign "complex and confusing agreements, with terms thrust on the customer at the last moment without adequate time to review, and with key parts of the agreements hidden in hyperlinks."

The plaintiff alleged that, as well as suffering delays to the project, Oracle failed to deliver the required functionality. RSI claimed it lost $170,000 in implementation and subscription fees, $700,000 in additional resources it dedicated to the failed project, and also suffered additional damages in the form of lost revenue and efficiencies.

A notice in June this year said that the two companies had scheduled a private mediation session in August. Neither party has disclosed the details of the agreement. ®

https://www.theregister.com//2024/09/30/oracle_netsuite_settlement/