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.