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Firm Oracle hired to investigate Microsoft tried to sift garbage

on 6/29/00.

Oracle's Larry Ellison said Wednesday his goal behind investigating Microsoft's funding of sympathetic lobbying groups --- first reported late Tuesday night --- was to expose the software giant's "covert" activities.

However, the chief executive said he was unaware until Tuesday that Oracle had hired an investigative firm and did not know the firm had attempted to go through the advocacy groups' garbage.

"Do I take responsibility? Absolutely," Ellison said Wednesday. "I authorized them to investigate Microsoft's activities" and approved a budget for the effort.

"We didn't spy," he said. "We tried to expose what Microsoft was doing."

Microsoft responded by issuing a statement that said in part, "The only thing more disturbing than Oracle's behavior is their ongoing attempt to justify these actions."

Oracle acknowledged hiring Investigative Group International to investigate the Independent Institute of Oakland, Calif., and the National Taxpayers Union of Arlington, Va.

Those groups, as well as Citizens for a Sound Economy and the Association for Competitive Technology, supported Microsoft during its two-year antitrust dispute with the Justice Department and 19 state attorneys general.

At times, the groups have claimed serious harm would come to the high-tech industry and the U.S. economy if Microsoft is punished for court-found antitrust violations.

Microsoft has appealed a federal district court decision to break it into two and has denied it infringed antitrust law.

The Wall Street Journal also reported that Oracle hired a Washington public relations firm, Chlopak, Leonard, Schechter & Associates, to disseminate potentially damaging information about Microsoft to the media. That work included suggestions that a company headed by political consultant Ralph Reed
--- a top campaign strategist for George W. Bush --- was trying to persuade the presidential candidate to support Microsoft.

''This is pretty standard," said analyst James Pickrel of Chase H&Q. "Many companies in the Silicon Valley do this on some level. You could call it corporate espionage or competitive intelligence.''

''It's been no secret that Larry Ellison has been gunning for Bill Gates for a long time. Oracle is among the Silicon Valley companies leading the charge, looking for an opening to break Microsoft's dominance,'' he added.

Oracle CEO Larry Ellison said he did not know of the trash- sifting. / PAUL SAKUMA / Associated Press