IT Vendors Sue Dell, Ciber And New Orleans

A trial now under way in New Orleans involves alleged corruption, a supposed conspiracy and big-name tech companies -- a lot even for the Big Easy.

Pretrial activity has gone on for weeks, offering insights into potential credit card abuses by IT procurement officials in City Hall, vacations for Mayor Ray Nagin paid for by IT suppliers to New Orleans, and connections within City Hall to various suppliers.

The trial centers around two small IT firms' allegation that computer powerhouse Dell improperly muscled its way into becoming a supplier to the city, thereby bouncing them off a security camera deal. The allegations further contend that Dell and other tech vendors with connections inside City Hall conspired to steal the plantiffs' technology.

The plaintiffs, Southern Electronics and Active Solutions, were engaged with the city to provide security cameras in 2006.

The defendants allege Dell won the contract because Southern Electronics and Active Solutions weren't performing well. But the plaintiffs contend that they were replaced because Dell and city vendor netMethods had connections with Greg Meffers, the city's IT chief. U.S. Attorney Jim Letten has acknowledged a federal criminal investigation at City Hall; Meffert has confirmed he's a target of the probe.

In addition, investigators are focusing on New Orleans' purchase of surveillance cameras in 2006 under Dell's state purchasing agreement -- which explicitly leaves off cameras. In other words, the city was not supposed to buy cameras from Dell, but did so, allegedly by referring to the devices in purchasing documents as "eyeballs."

Solution provider Ciber (VAR500 Rank 83) is included as a defendant because the plaintiffs claim Ciber was in on the conspiracy. The VAR allegedly billed the city for work performed by a subcontractor under the Dell contract.

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