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IBM withdraws from deal to purchase Sun; Dallas colo investigated

In today's news in brief, IBM has withdrawn its bid to purchase Sun Microsystems, and a Dallas colo raided by the FBI is under investigation.

IBM, Sun talks wavering, according to reports
IBM has withdrawn its bid to acquire Sun Microsystems, according to multiple reports this weekend.

The Wall Street Journal reported that the impasse is due largely to a split opinion among Sun insiders, with Chairman and co-founder Scott McNealy fighting the acquisition while CEO Jonathan Schwartz pushes for it. IT pros and technology providers have been mostly skeptical of the deal, especially Sun customers worried about how it could affect Sun technology.

Raided colocation data center under investigation for fraud
The company that runs a Dallas colocation data center which the FBI raided last week is under investigation for fraud, according to a report.

CBS in Dallas, citing court documents related to the raid, reports that Core IP Networks is one of several Web server providers being investigated for defrauding AT&T and Verizon out of millions of dollars. The two telecom giants reportedly told federal officials that Matthew Simpson, Core IP's CEO, along with four others, had defrauded them out of $6 million worth of fees in a three- to four-month period.

Simpson denied the charges, telling CBS Dallas that he is doing everything he can to "cooperate with the investigation and to help … clients get back up and running."

Last week, in a letter posted online, Simpson claimed the raid was the result of an FBI investigation into a company that once purchased services from Core IP Networks but that didn't colocate with them. There was speculation that the raid may have been connected to illegal downloads of the soon-to-be-released X-Men Origins: Wolverine movie, but that hasn't been verified.

Simpson has not replied to repeated requests for comment.

Let us know what you think about the story; email Mark Fontecchio, News Writer

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