Video: June 21: Check not in mail

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updated 6/21/2006 3:23:50 PM ET 2006-06-21T19:23:50

Harvard University has been left in the lurch by Larry Ellison, chairman of software group Oracle, who has failed to make good on a $115 million donation 10 months after academics believed they could count on the money.

The Ellison Institute for World Health, which was gearing up to employ a staff of 130 by the summer of 2007, has been put on hold. Twenty research fellows and five top academics had been all but appointed, while three senior managerial staff who had been hired, have now been dismissed.

The delays come amid uncertainty at Harvard following the imminent resignation of Larry Summers, its president, although fund-raising during his leadership fell to a 16-year low in 2005.

The planned Ellison Institute, which was to study and disseminate ways to assess health policies around the world, would have marked a big increase in philanthropic support by Ellison, estimated by Forbes to be the world's 15th richest man with $16 billion in net assets.

It would also have marked Ellison's second foray into global health, an area of increasing interest to wealthy businessmen led by Bill Gates, the head of Microsoft, who last week said he would step down in 2008 to devote himself principally to philanthropy.

Prof. Christopher Murray, head of Harvard's Global Health Initiative, who was set to run the new institute, confirmed on Tuesday that he was still awaiting $115 million first promised by Ellison in March 2005 and set to be paid last September. He said: "I remain hopeful that Ellison will follow through on his commitments."

Individuals involved in the discussions say Ellison first offered $100m in December 2004 in talks with Prof. Murray, and then increased that to $115 million after conversations with Summers.

But after exchanging draft contracts, drafting a press release and saying the money would arrive in days, Ellison's advisers last autumn began linking payment to final settlement of an insider-trading suit brought by Oracle shareholders, which was to include a substantial donation to charity. Summers and others have been unable to discuss the matter with him since November.

The idea was to spend the money over three years, after which Ellison said if he was satisfied he would donate a further $500 million over the following decade with the aim of building a sustainable center to study effective approaches to health.

"He was enthusiastic and I am deeply committed to this project," said Prof. Murray. "Right now we just don't know whose health systems are working and what should be done to improve health, which is one of the largest sectors in the economy globally."

A spokesman for Ellison at Oracle refused to comment Tuesday.

Additional reporting by Rebecca Knight

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