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Judge rules on summary judgment motions in IBM case

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The State of Indiana may be on the hook to pay IBM $40 million in subcontractor assignment fees per the contract it had with IBM to update the state’s welfare system, a contract the state cancelled in October 2009 because it wasn’t happy with results.

Marion Superior Judge David Dreyer issued several rulings Wednesday in the lawsuit stemming from the cancelled contract between the state and IBM. The state hired IBM in 2006 but cancelled the contract three years later and sued IBM to try to recover the millions it paid before ending the contract, plus triple damages. IBM countersued for breach of contract, arguing the state still owed around $100 million.

Dreyer rejected the state’s contention that IBM isn’t entitled to the $40 million in subcontractor assignment fees. The contract between the state and IBM said that the “state shall pay” IBM those fees, and there is no dispute that the state accepted assignment of the subcontracts at issue. The Family & Social Services Administration believes this ruling is an error and plans to appeal, according to a spokeswoman.

IBM also asked for $43 million in deferred fees due to the termination of the agreement as well as $9.3 million for equipment the state has but did not pay IBM for, but Dreyer denied summary judgment on those issues.

Dreyer ruled in favor of the state on IBM’s argument that its poor performance could be excused because of the economic downtown and flooding that occurred after the contract was signed. He found that any contention by IBM at trial that the economy or the flooding rendered its performance “impossible” or otherwise justifies any failure by IBM to meet contractual obligations are precluded as a matter of law.

There are also disputes of material fact as to whether there was a breach of the contract, so Dreyer denied the state’s motion for summary judgment on the matter.

The court has ruled the state is limited to recovering no more than $125 million in damages; if the state can’t prove IBM breached the contract, it could owe the company $100 million per a termination clause.

An issue that arose from this case is whether Gov. Mitch Daniels can be deposed. Dreyer originally ruled Daniels doesn’t have to be deposed, but later ruled that he can be. That issue will be before the Indiana Supreme Court Feb. 13.

The case is set to go to bench trial Feb. 27.

 

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  1. I will continue to pray that God keeps giving you the strength and courage to keep fighting for what is right and just so you are aware, you are an inspiration to those that are feeling weak and helpless as they are trying to figure out why evil keeps winning. God Bless.....

  2. Some are above the law in Indiana. Some lined up with Lodges have controlled power in the state since the 1920s when the Klan ruled Indiana. Consider the comments at this post and note the international h.q. in Indianapolis. http://www.theindianalawyer.com/human-trafficking-rising-in-indiana/PARAMS/article/42468. Brave journalists need to take this child torturing, above the law and antimarriage cult on just like The Globe courageously took on Cardinal Law. Are there any brave Hoosier journalists?

  3. I am nearing 66 years old..... I have no interest in contacting anyone. All I need to have is a nationality....a REAL Birthday...... the place U was born...... my soul will never be at peace. I have lived my life without identity.... if anyone can help me please contact me.

  4. This is the dissent discussed in the comment below. See comments on that story for an amazing discussion of likely judicial corruption of some kind, the rejection of the rule of law at the very least. http://www.theindianalawyer.com/justices-deny-transfer-to-child-custody-case/PARAMS/article/42774#comment

  5. That means much to me, thank you. My own communion, to which I came in my 30's from a protestant evangelical background, refuses to so affirm me, the Bishop's courtiers all saying, when it matters, that they defer to the state, and trust that the state would not be wrong as to me. (LIttle did I know that is the most common modernist catholic position on the state -- at least when the state acts consistent with the philosophy of the democrat party). I asked my RCC pastor to stand with me before the Examiners after they demanded that I disavow God's law on the record .... he refused, saying the Bishop would not allow it. I filed all of my file in the open in federal court so the Bishop's men could see what had been done ... they refused to look. (But the 7th Cir and federal judge Theresa Springmann gave me the honor of admission after so reading, even though ISC had denied me, rendering me a very rare bird). Such affirmation from a fellow believer as you have done here has been rare for me, and that dearth of solidarity, and the economic pain visited upon my wife and five children, have been the hardest part of the struggle. They did indeed banish me, for life, and so, in substance did the the Diocese, which treated me like a pariah, but thanks to this ezine ... and this is simply amazing to me .... because of this ezine I am not silenced. This ezine allowing us to speak to the corruption that the former chief "justice" left behind, yet embedded in his systems when he retired ... the openness to discuss that corruption (like that revealed in the recent whistleblowing dissent by courageous Justice David and fresh breath of air Chief Justice Rush,) is a great example of the First Amendment at work. I will not be silenced as long as this tree falling in the wood can be heard. The Hoosier Judiciary has deep seated problems, generational corruption, ideological corruption. Many cases demonstrate this. It must be spotlighted. The corrupted system has no hold on me now, none. I have survived their best shots. It is now my time to not be silent. To the Glory of God, and for the good of man's law. (It almost always works that way as to the true law, as I explained the bar examiners -- who refused to follow even their own statutory law and violated core organic law when banishing me for life -- actually revealing themselves to be lawless.)

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