This article is more than 1 year old
EMC whistleblower says Symmetrix coverup caused nervous breakdown
'Cat is out of the bag'
EMC allegedly tried to withhold information about faults in its Symmetrix storage systems from customers in the hopes of avoiding millions in replacement charges, according to a lawsuit from an EMC employee.
Jack Wade has lobbed serious charges against EMC in a lawsuit filed with the Franklin Country Common Pleas Court in Ohio. The worker claims that EMC forced him to withhold information about Symmetrix flaws from three customers. The situation was so disconcerting to Wade that he suffered a nervous breakdown and went on disability.
Wade's lawsuit has gone largely unnoticed by the mainstream media, but two outlets - The Plain Dealer and The May Report - have done extensive research into the case. They document charges that EMC witheld some information from Bank One, the Ohio Department of Administrative Services and Convergys Corp. and sold the organizations old Symmetrix systems when the companies expected to receive new kit.
An EMC spokeswoman said that Wade's claims "are without merit". The company has not shipped the type of systems mentioned in Wade's lawsuit for two years.
One email dating back to May 2003 included in Wade's lawsuit has company officials describing the Symmetrix flaws as "a ticking time bomb," according to The Plain Dealer, which obtained the documents. " Another email, marked confidential and sent seven months later, reported that someone had leaked information about a Symmetrix chip defect to Bank One and that 'the cat is out of the bag,' the paper reported.
In November of 2003, Wade complained to a supervisor that he refused to ship Bank One old systems and that he was concerned about having to "falsify" quarterly reports to reflect sales of the supposedly new systems.
In 2004, EMC admitted to problems affecting its pricey Symmetrix 8000 systems, saying a small number of the boxes suffered from faulty SCSI chips. At the time, EMC told reporters that it had "proactively" reached out to customers to fix the issue and had put the matter behind it.
But just how proactive was the company?
The May Report has posted an email from a person claiming to be a former Bank One employee who dealt with the bad Symmetrix gear. It reads as follows:
We had a large crop of 8830's and many of them were affected by the chip problem described in your report. As a matter of fact we had 4 of them fail in a 6 month period and they had to be replaced. However, as Bank employees we didn't know about the chip problem.
While I was there, EMC came in and offered to replace all of our 8830's and older boxes with the new DMX's for "free". This was about 20 million dollars worth of equipment. Bank management agreed, but there was a stipulation. In exchange for the "free" tech refresh, the Bank had to agree to award 80% of it's storage buisness going forward to EMC.
So basically, without ever disclosing to Bank One that there critical data was sitting on faulty equipment EMC turned their liability into a "win" by buying the Banks future business.
After I left the Bank I ran into an ex-EMC employee and asked why EMC had been so "generous". He then described in detail the chip problem and stated that EMC decided there was too much potential for exposure because of the number of 8830's on the floor, and that they had to get them out. The problem affected every 8830 manufactured after a certain date, and EMC did indeed, knowingly keep shipping the boxes to customers. He said EMC wasn't doing this kind of replacement for smaller customers because they could explain away one or two failures as anomalies.
Ron May - the owner of the site - first reported Wade's complaints in March 2004. The two men stayed in touch over the next year, with May revealing more and more about Wade's battle with EMC. That is until Wade's lawyers realized what was happening.
"His lawyers are probably ready to shoot him," May told The Register. "He told me that EMC offered a settlement for $1m and that his lawyers were looking for as much as $10m. He is a really straight guy - the kind of guy that really wouldn't do wrong to anybody. That's my sense."
Wade has since stopped communicating with May.
While EMC may have had problems with the Symmetrix gear, its customers don't seem terribly bothered by the situation. Bank One named EMC its "IT Supplier of the Year" in 2003 - the same year in which the Symmetrix issues are said to have occurred. In addition, a representative from Ohio's Department of Administrative Services told online storage rag Byte and Switch that he was happy with EMC's gear and actions.
EMC sells a lot of Symmetrix systems, making a serious flaw hard to hide. One would expect numerous reports of system failures from customers. EMC may well have offered sweet deals to the few affected customers but that type of behavior is typical of a large vendor.
EMC confirmed that Wade is still an employee of the company and that it is dealing with the lawsuit. A lawyer representing Wade has yet to return a call seeking comment. ®