WorldCom woes limit DREN action

In a seemingly paradoxical twist, WorldCom Inc.'s decision to file for bankruptcy protection means that the Defense Department cannot immediately terminate the contract for a high-speed network for researchers.

WorldCom filed for bankruptcy July 21. The Defense Information Systems Agency had been assessing its next options for the Defense Research and Engineering Network (DREN) contract, which WorldCom won earlier this year. WorldCom's bankruptcy filing, however, limits the actions that DOD can take.

"The DREN contract is considered an asset under federal bankruptcy laws," said DISA spokeswoman Betsy Flood. Therefore, any legal action, such as terminating the contract, would have to go through the bankruptcy court because of rules that prevent "adverse contractual actions" without the court approval.

The action is the latest in the roller-coaster history of the $450 million contract. The move comes just weeks after two of the losing vendors — Sprint and Global Crossing Ltd. — filed protests with the General Accounting Office objecting to the WorldCom award.

Those protests are pending.

DISA selected WorldCom earlier this year as the follow-on vendor for DREN for scientists and researchers.

Global Crossing, which had all but won the contract before the company declared bankruptcy, had filed a protest with GAO earlier, but it was rejected. Sprint and AT&T also filed protests but withdrew them before GAO issued a decision.

About the Author

Christopher J. Dorobek is the co-anchor of Federal News Radio’s afternoon drive program, The Daily Debrief with Chris Dorobek and Amy Morris, and the founder, publisher and editor of the DorobekInsider.com, a leading blog for the Federal IT community.

Dorobek joined Federal News Radio in 2008 with 16 years of experience covering government issues with an emphasis on government information technology. Prior to joining Federal News Radio, Dorobek was editor-in-chief of Federal Computer Week, the leading news magazine for government IT decision-makers and the flagship of the 1105 Government Information Group portfolio of publications. As editor-in-chief, Dorobek served as a member of the senior leadership team at 1105 Government Information Group, providing daily editorial direction and management for FCW magazine, FCW.com, Government Health IT and its other editorial products.

Dorobek joined FCW in 2001 as a senior reporter and assumed increasing responsibilities, becoming managing editor and executive editor before being named editor-in-chief in 2006. Prior to joining FCW, Dorobek was a technology reporter at PlanetGov.com, one of the first online community centers for current and former government employees. He also spent five years at Government Computer News, another leading industry publication, covering a variety of federal IT-related issues.

Dorobek is a frequent speaker on issues involving the government IT industry, and has appeared as a frequent contributor to NewsChannel 8’s Federal News Today program. He began his career as a reporter at the Foster’s Daily Democrat, a daily newspaper in Dover, N.H. He is a graduate of the University of Southern California. He lives in Washington, DC.


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