IBM Banned From Federal Contracts; No One Saying Why

from the that-can't-be-a-good-thing dept

It’s not at all clear what’s going on yet, but apparently the EPA has banned IBM from getting any contracts for some unnamed (serious) infraction. Apparently when one gov’t agency does such a thing, others follow suit, meaning that effectively IBM may be barred from getting any new government contracts for an extended period of time (potentially up to one year). This is rather unusual, and no one seems to be saying why this ban was put in place, but needless to say, it suggests some sort of pretty serious infraction on the part of IBM.

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Companies: ibm

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Comments on “IBM Banned From Federal Contracts; No One Saying Why”

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Paul.S says:

EPA troubles?

It appears on the surface that the EPA is complaining that IBM tried to gather information from their employees illegally.

However Boeing (among others) appear to be guilty of the same charge.

It wouldn’t have anything to do with the fact that IBM gave the Democrats three time as much money as what they gave the Republicans? Would it?

Anonymous Coward says:

my guess

My guess is that IBM got a little carried away at upselling Uncle Sam. I imagine that someone finally got tired of seeing additional support costs beyond the initial contract timeframe rising by an order of magnitude.
Just speculation of course, but I think the EPA may not be the only government agency that has been burned doing business with big blue.

Anonymous Coward says:

Re: my guess

IBM Consulting Services had an exclusive contract, to service Nokia, globally. That’s a 60,000 user intranet folks.

IBM, in classic bold arrogance, lost the contract there too, thinking no one would bother to removing IBM from the picture.

But then IBM moved lots of folks from the picture via outsourcing. Live and learn.

Following a Nokia loss, maybe the US govt. will focus IBM management? Sure hope so.

moe says:


Wow, a lot of speculation going on here in the comments. The gov’t takes contracting and the transparency required to do it correctly very, very seriously. When a potential bidder, in this case IBM, doesn’t take it seriously the gov’t punishes them.

No, this isn’t political retribution Paul S.

No, this isn’t about upselling Uncle Sam(which would get you debarred, but it’s not the case here).

IBM violated the rules of contracting with the gov’t. If a contractor debarment wasn’t on the up and up, then the contractor would sue and win. The gov’t takes all aspects of contracting seriously, including the punishments it levies.

Scott Spinola (user link) says:

Not an "unnamed infraction" at all

The reason IBM was blacklisted was very clearly stated in the article Anonymous Coward links to:

“The subpoenas, which were issued March 28 by the U.S. Attorney’s Office for the Eastern District of Virginia, stem from an EPA investigation into allegations IBM improperly obtained information about a contract it was bidding on from EPA employees, said Fred McNeese, an IBM spokesman.”

This is from the Federal Times online, not exactly an out of the way source. I’m disappointed in Mr. Masnick and his reporting on this. Perhaps he posted his story before the Federal Times posted theirs, but I’m sure Mr. Masnick could have done a little digging to find the information, or at least updated his article with the new information when it became available.

This is the problem with “rumors, conspiracies, etc.”, they are rarely based on fact.

Ronald J Riley (profile) says:

IBM is a joke today.

IBM is a company who let the Japanese take the mainframe market from them and Microsoft take the operating system market. The only reason that IBM still exists today is their patent portfolio. IBM is a husk of its former self and a joke.

IBM files hordes of incremental mostly insignificant patents and their conduct is one of the reasons that the patent system is burdened. They sense that their days are numbered, and that eventually they will expire with a whimper.

They have a vision for a patent system which is a king’s sport, where only the privileged vested interests can play.

There are two major big business camps promoting reformation of the patent system.

One group simply wants to eviscerate the system to mitigate the consequences of their patent pirating conduct. This group was initially formed by washed up tech companies who lost their ability to produce significant inventions decades ago and a few parasitic companies who never were innovators, rather they are shrewd predators on innovators. They were then joined by the insurance and banking industries, of which one group is only innovative at denying claims and the second group’s claim to fame is inventing ever more and larger fees. This group calls themselves the Coalition for Patent Fairness, but are better known as the Coalition for Patent Piracy. Their members have a variety of deficiencies such as being caught cooking their books, putting their customers at risk of being maimed or killed with defective products, committing fraud on the court in litigations over their patent piracy, and various other sins.

The second group are much older companies. They tend to value their patents but would very much like to reign in pesky inventors who nip at their heels. They are also hot on HARMazation of America’s patent system, a process which dumbs down the greatest patent system in the world for those company’s benefit. This group is known as the 21st Century Patent Coalition. While they are marginally better than the Coalition for Patent Piracy they are also very short term gain oriented businesses.

Both groups prey on the real inventors of our country. Both are prone to abuse the process of law in a bid to bankrupt inventors. Both ship the fruits of American ingenuity to developing countries. Both groups routinely indenture inventors in those countries and will dispose of their empty husks just as they have done to our inventors when they find a slightly better deal elsewhere.

Independent inventors have community ties and when they prosper so do their communities. But when the inventors have their spirits killed by disreputable and predatory large companies, the community suffers a much greater loss than the inventor.

Beware, for these companies are throwing hundreds of millions of dollars into “reforming” our patent system to be more friendly to them and much less friendly to upstart startup companies. They know that this is a bargain if it facilitates their appropriation of billions of dollars. It is a fact that many of the companies promoting various special interest “reforms” of the patent system have been caught red handed cheating, lying, and thieving – and they are being held accountable for their poor conduct. Accountability is what drives their whining about bigger than live mythical trolls.

Ronald J. Riley,

Speaking only on my own behalf.
President – – RJR at
Executive Director – – RJR at
Senior Fellow –
President – Alliance for American Innovation
Caretaker of Intellectual Property Creators on behalf of deceased founder Paul Heckel
Washington, DC
Direct (202) 318-1595 – 9 am to 9 pm EST.

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