A patent filed in May 2010 describes a system that includes a cartridge of extinguishing agents comprised of carbon dioxide and halon, which will be released on the processor and certain portions on the mainboard while the power supply is disabled at the same time. The system also includes an infrared light-based flame detector.
IBM said that computers, which we are told are much more complex than the EDVAC from 1948, often short circuit, causing small fires in the computer--especially blade servers. Since a power supply will continue to supply electricity until it is taken out, IBM says that "depending on the location of the short on the system board, a fire can result until either the high impedance short opens completely or shorts completely, at which point the power supply over-current detection circuit shuts the power supply down."
The company's application goes on to note that "such small fires in a server or other computer often do not produce enough smoke to set off a smoke detector until the fire has spread to the point of endangering other servers and computers."
IBM's idea to extinguish a possibly dangerous fire is pretty simple: A fire detector would detect flames, shut the power supply off and puncture a hole into the "stored pressure unit containing the extinguishing agent."
patent the things which are really innovative
However, this may be a bit overkill.
One of the things that the Navy taught me about class charlie(electrical) fires, is that the fire is "out" when the power is secured.
Now, with that being said, as was noted in this article, the powersupply in a computer will detect a short condition and secure power on its own.
Installing a potentially expensive fire suppression system in a computer that already has safeguards against electrical fires sounds like a gimmick to me.