U.S. DoJ Joins Suits Alleging HP, Sun, Accenture Kickbacks

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Thu, April 19, 2007

IDG News Service (Washington, D.C., Bureau) — The U.S. Department of Justice has joined three whistleblower lawsuits alleging that Hewlett-Packard, Sun Microsystems and Accenture paid and received kickbacks from IT partners in exchange for preferential treatment on government contracts, the DoJ said Thursday.

The lawsuits, filed in U.S. District Court for the Eastern District of Arkansas, allege that the three companies submitted false claims to the U.S. government on "numerous" government contracts since the late 1990s. The lawsuits, originally filed by Accenture employee Norman Rille and another whistleblower, accuse the companies of creating alliance relationships with dozens of other vendors, giving each other discounts or rebates on products or work for government contracts. The companies did not pass the rebates on to their government clients, according to a DoJ court filing.

Representatives of the three companies did not immediately respond to requests for comment.

Among the more than three dozen IT vendors named as Accenture alliance partners were Cisco Systems, Microsoft, IBM, Dell and Oracle.

The DoJ's complaint asserts that these alliance relationships and the resulting alliance benefits amount to kickbacks and undisclosed conflict-of-interest relationships.

"The Department of Justice is acting in this case to protect the integrity of the procurement process," Peter Keisler, assistant attorney general for the DoJ's civil division, said in a statement.

The suits were originally filed under the whistleblower provisions of the U.S. False Claims Act. Under that statute, a private party can file an action on behalf of the United States and receive a portion of the recovery.

Under the False Claims Act, the U.S. government may recover three times the amount of its losses plus civil penalties. The DoJ filed its complaint in intervention in the matters on April 12, and the complaints were unsealed Thursday.

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