Overview
- Bondholders filed a proposed class action on Jan. 14 in New York state court in Manhattan.
- The suit covers investors who bought $18 billion of notes and bonds issued on Sept. 25, two weeks after Oracle announced a $300 billion, five-year computing deal with OpenAI.
- Plaintiffs say they were blindsided when Oracle obtained $38 billion in loans seven weeks later to fund two data centers supporting the OpenAI agreement.
- The complaint names Oracle, Larry Ellison, former chief executive Safra Catz, Chief Accounting Officer Maria Smith, and the underwriters, alleging strict liability for false or misleading offering documents.
- Bondholders cite falling prices and rising yields on Oracle debt after the new borrowing and seek unspecified damages, and the company did not immediately comment.