IBM Must Face Suit Saying It Tricked IRS Into Software Deal (1)

A False Claims Act whistleblower will have another chance to allege IBM worked with Deloitte LLP to fraudulently induce the Internal Revenue Service into signing a $265 million software contract, the D.C. Circuit said.

A district court erred by concluding that Paul Cimino, a former IBM sales representative, didn’t adequately allege that IBM created a false audit in an attempt to coerce the IRS into paying for unwanted software, the U.S. Court of Appeals for the D.C. Circuit said Tuesday.

Cimino adequately pleaded but-for causation by alleging facts plausibly demonstrating that the IRS wouldn’t have entered the agreement but for ...