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6/1/2006
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Sprint Sues IBM Over Failed Outsourcing Deal

Telecom firm asks for $6.4 million, charging that IBM didn't handle application development as promised.

When outsourcing deals go bad, someone usually gets mad. Sprint also wants to get paid, filing a lawsuit charging that IBM didn't deliver the cost savings promised under a five-year, $400 million outsourcing deal involving computer programming. Sprint wants $6.4 million for 119,000 hours of uncompleted development work. Sprint transferred around 1,000 of its IT staff to IBM as part of the original deal, but has since brought back around 400 workers and taken back control of its application development. IBM wouldn't comment on the suit, but the two companies remain on speaking terms. IBM's still doing a lot of work for Sprint under other contracts.

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