updated 5/13/2005 5:35:15 PM ET 2005-05-13T21:35:15

Oracle Corp. has agreed to pay $8 million to settle a whistleblower lawsuit claiming the business software maker fraudulently billed federal agencies for training from 1997 through 2003.

Robert J. Makheja, of McLean, Va., the former Oracle employee who filed the complaint in U.S. District Court in Boston, will receive $1.58 million from the settlement.

Because the lawsuit was based on a whistleblower complaint, it had been sealed until U.S. Attorney Michael J. Sullivan announced the settlement on Friday.

Makheja was North American vice president for sales at Oracle University, a division of Redwood Shores, Calif.-based Oracle that trains customers on using the company's products. He claimed he was fired by Boston-based supervisor Ken Hamel after Makheja challenged the company's billing practices in contracts with the government.

Federal prosecutors investigated and filed their own claims against Oracle. Some of the alleged abuses involved billing and collecting from the government before training was provided. The government also accused Oracle of violating regulations for billing the government for travel and other expenses.

The settlement agreement states that Oracle denies all the allegations, and that its conduct was permitted under contract terms and under the law. Oracle spokeswoman Deborah Lilienthal declined to comment.

Hamel, who no longer works for Oracle, declined to comment when he was reached at his Newton home.

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