Indiana-IBM Trial over Welfare Modernization Contracts Begins

Today marks day one of a six-week trial to settle a dispute between Indiana and technology mogul IBM.
by | February 27, 2012

Today marks day one of a six-week trial to settle a dispute between Indiana and IBM.

The state had asked IBM for the $437 million that it previously paid the company, while IBM wants $43 million along with its equipment back from the state, reports the Indianapolis Star.

The two lawsuits trace back to 2009, when the state of Indiana broke a 10-year, $1.37 billion contract with IBM after just three years. The company was contracted to create an online automated welfare system for the state’s Family and Social Services Administration (FSSA). The Star reported that people’s confusion with the system caused the state to end the agreement.

A lawyer for FSSA said that the system was filled with errors, and IBM failed to meet deadlines. "Our argument is pretty simple," FSSA attorney Peter Rusthoven told the Indianapolis Star. "We hired them to do something. They didn't do it."

Gov. Mitch Daniels almost had to testify in court, but the Indiana Supreme Court overturned a lower court’s decision and ruled that certain public officials are protected from testifying in civil cases, according to the paper.

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