Oregon AG: "Oracle sold the State of Oregon a lie."

Oracle committed fraud and racketeering, breached contracts, and made a series of false claims in its dealings with the State of Oregon's Cover Oregon website project, according to the lawsuit filed Friday morning by Attorney General Ellen Rosenblum's office.

The complaint alleges the technology company repeatedly failed to deliver on its obligations, overcharged for "poorly trained Oracle personnel to provide incompetent work," hid the true extent of its "shoddy performance," continued to make promises it could not keep and "willfully" refused to honor is warranty to fix errors without charge.

RELATED:Oregon and Oracle say each other killed Cover Oregon

In total, Oracle's false claims cost the state an "extraordinary" $240,280,008, Rosenblum said.

The complaint offers a scathing assessment of Oracle's work.

It accuses Oracle of lying to the state from the very beginning—lying about its ability to meet Oregon's IT needs, lying about its products being "flexible" and "integrated," lying about its programs needing little customization.

"Oracle sold the State of Oregon a lie," it says.

The lack of a systems integrator to oversee the entire project was one of the major faults of Cover Oregon, according to a third-party audit released earlier this year. However, the attorney general saddles Oracle with the responsibility for that.

It claims Oracle was "dead set against" the state hiring a systems integrator. Instead, the complaint alleges a "behind the scenes effort...to make sure (the sate) doesn't bring in (a systems integrator) because it's just going to cause trouble."

In doing so, the company convinced the state to pay millions to Oracle Consulting Services to run the project.

The complaint paints a picture in which the state was left completely in the dark as Oracle worked on the project with "nearly unfettered control," providing state officials with very little, often false information about its progress.

In the end, Oracled "failed."

Not only did it not meet its Oct. 1 deadline, the complaint said, but its work was terrible. Cover Oregon identified 1,198 errors in the final website and was unable to use most of "Oracle's shoddy and incomplete work."

The complaint quotes a former Oracle employee who said the company's products worked as if designed "by a kindergartner."

The end result was a disaster.

"In effect, Oracle used its purported superior expertise, coupled with lies and pressing deadlines, to trap the State and Cover Oregon in a deadly spiral: at each juncture Oracle charged more and Oregon got less," the lawsuit said.

Gov. John Kitzhaber asked Rosenblum in May to sue Oracle after having fired most of the state officials responsible for the failed project.

"The fact is: Oracle did not deliver for the State of Oregon. The poor quality of work is obvious," he told the Joint Committee On Legislative Audits, Information Management and Technology on May 29. "Oracle's failure is unacceptable."

Meanwhile, Oracle has filed its own lawsuit in federal court against Cover Oregon. In its complaint filed Aug. 8, the company alleged breach of contract and "quantum meruit," i.e. failing to pay Oracle $23 million for its services.

The company accused Kitzhaber of running a "smear campaign" against it.

"Oracle, believing that the best solution for Oregonians was to focus on completing the project, continued to work, quietly and without public retort, in spite of the constant public slander," its complaint said.

The attorney general's office referenced that lawsuit in the complaint Friday.

"Oracle has never offered to return a penny of $240,280,008 it fraudulently obtained or to pay for any of the millions its failures cost the State. On the contrary, on August 8, 2014, Oracle filed a lawsuit riddled with false and irrelevant allegations against Cover Oregon, claiming that Cover Oregon owes Oracle an additional $23,000,000 for the "Oracle Solution" that never worked," it said.

Oracle has 30 days to respond to the complaint.

hhoffman@statesmanjournal.com, (503) 399-6719 or follow at twitter.com/HannahKHoffman