Larry Ellison, the chief executive of Oracle, the US software group, deliberately destroyed or withheld emails and did not preserve tape recordings that he should have handed over to lawyers acting for investors that are suing him, a judge has ruled.

In the lawsuit, shareholders allege that the world’s second-largest software company improperly booked millions of dollars of additional sales in the second quarter of 2001 and covered up problems with its Suite 11i database product. The suit claims that Mr Ellison knew about the problems and sold about $900 million of shares he owned in the group before they were disclosed to investors. The case is scheduled to begin on March 30.

US District Judge Illston said that emails and recordings of interviews with Mr Ellison for a biography titled "Softwar" were wilfully withheld by Mr Ellison and Oracle, even though they knew the material was potentially relevant to the case.

Judge Illston said: "The court believes it is appropriate to infer that the emails and the Softwar-related materials would demonstrate Ellison’s knowledge of, among other things, problems with the Suite 11I, the effects of the economy on Oracle’s business and problems with defendant’s forecasting models."

Ms Illston said she would instruct the jury to assume that Mr Ellison knew about the problems at Oracle before they were disclosed to investors. Furthermore, Ms Illston said she would take that assumption into account when deciding whether to throw the case out, as Oracle would like, or allow it to go to trial.

Oracle and Sean Williams, the lawyer representing the shareholders, declined to comment.

Mr Ellison settled a similar lawsuit out of court in 2005 by agreeing to donate $100 million to charities and pay $22 million in lawyers fees.

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