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Following IBM’s (NYSE:IBM) protestations, the U.S. Government Accountability Office determined that the $543 million federal contract for wireless tracking the Department of Veterans Affairs awarded to Hewlett-Packard (NYSE:HPQ) in June should be overturned.
The GAO agreed with IBB’s claim that the Department of Veterans Affairs did not properly evaluate the proposals from the more than 90 different companies competing for the five-year contract.
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Hewlett-Packard was chosen over five other companies for the contract to outfit veterans hospitals with wireless technology that would help minimize lost equipment, track whether medical devices are properly sterilized, and identify patients that may have received recalled products.
“GAO sustained, or upheld, IBM’s protest, finding that the VA had made several prejudicial errors in its evaluation,” said the GAO’s managing associate general counsel for procurement law, Ralph White, in a statement made on Wednesday.
As a contract arbiter, the Government Accountability Office recommended that the Department of Veteran’s Affairs reevaluate proposals for the contract and potentially reopen the bidding.
Following the GAO’s decision, shares of IBM rose while Hewlett-Packard’s stock dropped 11 percent.
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