IBM Denies Server Ponzi Scheme Allegations

By ServerWatch Staff (Send Email)
Posted Jun 24, 2010

According to this report on The Register, IBM's Systems and Technology Group is being sued by one of its partners, Devon IT. The Register also says the claim against IBM's Systems and Technology Group is for allegedly running what they call 'a wide-spread Ponzi scheme" over a period of five years. IBM has said that Devon's claims are without merit.

Devon IT appears to be suing IBM over failed virtual PC server projects.

"In the complaint, which you can read here and which was filed by Devon IT and two of its subsidiaries on June 16 in the US District Court for the Eastern District of Pennsylvania, Devon IT alleges that it kicked in $12m in co-development funds over five years for two server-backed PC client virtualization products.

"IBM did not discuss the case, but issued the following statement: 'Devon's overheated claims are without merit. The complaint, which attempts to dress up its lack of supporting evidence into charges based on 'information and belief,' is filled with outright falsehoods, half-truths, and exaggeration. There simply are no facts to support the improper and false conclusions that Devon draws. IBM has refused to be intimidated by months of Devon's threats into paying money that Devon is not properly due or owed. IBM will defend the suit vigorously and promptly seek to dismiss the claims.'"

Read the Full Story at The Register

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Tags: server, IBM, law, legal

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