(Bloomberg) -- A federal contractor that filed bankruptcy earlier this week during the latest round of government cutbacks asked a judge to approve a quick auction because of the ongoing threat of Elon Musk’s Department of Government Efficiency.
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Sysorex Government Services, Inc. said it needs to restart a three-year-old sale process under court supervision as soon as possible because managers can’t predict what will happen to its business while DOGE, which is not an official government agency, continues its review of federal spending.
“I wouldn’t say we’re a melting ice cube, it’s probably more like we’re on the tip of a potential chainsaw,” Sysorex bankruptcy lawyer Michelle McMahon said during a court hearing in New York on Friday. “The threatened cuts from DOGE come quick and often and somewhat without notice.”
US Bankruptcy Judge John P. Mastando approved the request and overruled an objection by the US Trustee, the federal corporate bankruptcy watchdog, which argued that the company was moving too fast.
Sysorex is among the first government contractors to cite DOGE’s work to justify its insolvency case. The company did not explicitly blame DOGE, but said the team’s influence added to Sysorex’s troubles.
The company needs an expedited sale process to ensure the IT business is sold for as much as possible, McMahon said. The firm has had trouble securing funding and could soon be facing eviction from its Virginia office, she said. Possible cuts to federal spending by DOGE is an additional threat, she added.
Sysorex filed bankruptcy on Monday in Manhattan, saying its revenue from government contracts was drying up and threatening its survival. The company had spent the previous three years trying to find a buyer for the business, which provides technology services under three existing government contracts.
Funding troubles have threatened its ability to provide services to agencies like the Federal Bureau of Prisons and the US Department of Agriculture, the company said in a court filing.
The case is Sysorex Government Services, Inc., 25-10920, US Bankruptcy Court for the Southern District of New York (Manhattan)
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