Senator Pushes for Cancellation of Sun Microsystems Contract

Grassley, in the letter, suggests that GSA should give Sun Microsystems notice that the company has 30 days to produce the documentation or else lose its contract with the federal government. Grassley claims that Sun has violated its contract by failing to “provide pertinent data in support of the audit I have requested.”

“Quite frankly, Administrator Doan, I do not understand why Sun would refuse to cooperate fully with this audit,” Grassley wrote. “Why is Sun refusing to provide all pertinent contract information as required by the contract? Why is Sun apparently afraid to open its books for inspection? This makes no sense to me. It makes me wonder: Does Sun have something to hide?”

Prompted by an investigation into allegations that Sun has defrauded the government of millions of dollars, Grassley on June 5 asked GSA Inspector General Brian Miller to “conduct a full and thorough audit of the current Sun Microsystems contract.” According to Grassley, Sun on July 26 and Aug. 2 "produced substantial quantities of materials,” but GSA Office of Inspector General (OIG) auditors determined that the documentation “was incomplete and unsatisfactory.”

On Aug. 20, Sun provided more documentation. However, according to Grassley, “preliminary indications are that Sun's latest submission includes extensive but still incomplete sales data and no information whatsoever on” a corrective action plan that Sun initiated “to correct the company's past contractual deficiencies.”

“Without all the requested information, the [inspector general] cannot complete that audit that I have requested,” Grassley wrote.

According to Grassley's letter, Sun's alleged failure to comply with the audit prompted Miller to advise Doan in an Aug. 13 report that current "circumstances warrant immediate notice of contract cancellation" with Sun.

Sun: Grassley “Continues to be Misled”

Sun Microsystems, responding to a request from GovPro.com for comment, provided a statement asserting that Grassley “continues to be misled regarding Sun's cooperation.” According to Sun, the company has produced “tens of thousands of documents, plus transactional data covering billions of dollars in sales, while being subjected to deadlines that appear designed to ensure the demands cannot be met.”

“We have complied with all our contract obligations and have responded to multiple agency and [OIG] demands,” the company said. “Less than three weeks ago, GSA stated publicly that Sun has been responsive. Ironically, in the same week the senator accused us of not producing sufficient information, OIG officials canceled a meeting to discuss these matters because our document production was so voluminous that they needed additional time to review.”

Responding to Grassley's assertion that Sun is unwilling to have its contract compliance process examined, Sun pointed out that the company, at the request of a GSA official, “engaged a top accounting firm to perform an independent and wide-ranging audit of its current GSA contract and related compliance programs, and that audit is underway.”

Sun also claimed that there is “clear evidence” that Miller and his staff are too biased to conduct an audit of the company. According to Sun, such concerns prompted the company to file a complaint with the President's Council on Integrity and Efficiency.