I believe the characterization of C3 as a "failure" is because it wasn't able to deliver the goal (goal was paying 87000 people – it only reached about 9000), and was later discontinued for multiple reasons (some unrelated, like people leaving, the merger with Daimler). The claim that "XP was banned" there seems overblown, it seems it's just that "people at DaimlerChrysler stopped taking terms like Smalltalk, OOP and XP" (per link above).