Court Rules Ellison Must Donate $100M to Charity

PokeyPenguin writes "As part of a settlement for insider trading allegations, a California judge has ordered that Larry Ellison donate $100 million to charity. CNet reports, 'The charity payments are an unusual way to settle such a case. Typically, settlement payments would go directly to the company, in this case Oracle. "But with Mr. Ellison owning a quarter of Oracle's stock, much of such a direct payment, in effect, would have gone to him."'"

Comments

Re:JDJ Had This News 6 Weeks Ago

[boingyzain]

From TFA: ...the terms of which were approved on Tuesday by a California judge. Of course, Tuesday being November 22nd, the day this article was run. So, if you were to RTFA, you would find that this lists the newest developments in this case, not the stuff from six weeks ago.

No Tax Break

[David Hume]

Ellison won't get a tax break. Although the payment is being made to a charity, it is not a charitable contribution. He is receiving legal consideration for the payment -- i.e., he is settling and discharing a debt. It would similar to the situation where you bought a used car from the charity, and paid them money in exchange. Your payment would not be a charitable contribution

More precisely, the charity is a third party beneficiary of a contract between the plaintiff(s) and Ellison to settle the case. It would be more like a case where "Seller" sells a car to you but, feeling charitable, writes the contract so you pay the money to the charity. In that case, if anyone got a deduction it would be "Seller" and not you.