VMware will pay the government $75.5 million to settle an overcharging lawsuit

June 30, 2015
Business Insider

VMware and one of its reseller partners will pay $75.5 million settlement to the General Services Administration (GSA) to settle a lawsuit alleging that the virtualization software company defrauded the federal government.

VMware in a statement says it denies the charges of fraud, but settled anyway to avoid protracted litigation.

The GSA is a federal agency that handles logistics and office space for other parts of the government. VMware is one of the largest software companies in the world, with more than $6 billion in revenue last year.

The suit was originally filed in 2010, and remained sealed by the Department of Justice until the settlement was finalized earlier today. Cotchett, Pitre, & McCarthy, the prosecuting law firm in this case, calls it "one of the five largest recoveries against a technology company in the history of the False Claims Act" in a press release.

The suit was filed by a GSA sales executive who accused VMware of "inaccurate pricing, inaccurate disclosures, and incomplete information about sales of VMware products to non-governmental customers," Cotchett, Pitre & McCarthy says. "In short, the lawsuit alleged the government paid more than private companies for the same services."... (To read the entire article, please click HERE)