(AP) — The core issue in a dispute over a project to modernize Indiana's
welfare system — whether IBM breached the billion-dollar contract — wasn't
addressed when a judge dismissed 17 of the state's claims against the
computer giant, an attorney for the state said Monday.
County judge rejected the state's allegations that IBM provided false
information during the project. One of the dismissed claims would have
allowed the state to collect triple damages.
complaint against IBM for us is breach of contract ... and this does
nothing with respect to that," said Peter Rusthoven, one of the private
attorneys representing the state in this case. "The main issue is whether
they did what they said they would."
Dreyer, who issued the order Sunday, is presiding over a trial that
started last month of dueling lawsuits concerning the state's cancellation
of IBM's nearly $1.4 billion contract with the Family and Social Services
Administration. Gov. Mitch Daniels killed the contract in 2009, less than
three years into its scheduled 10-year span amid wide-ranging performance
complaints from clients, their advocates and federal officials.
suing IBM for the $437 million it paid the company, and IBM is
countersuing for about $100 million that it claims it's still owed.
denied the state's claims that it was the victim of a crime, which would
have made it eligible to collect triple damages, and that IBM's
countersuit was frivolous.
"The State has
introduced no credible evidence that IBM knowingly or intentionally made
any false Statements to the State or any other governmental entity,"
Dreyer wrote in the eight-page order, which granted IBM's motion for
summary judgment on some of the claims.
applauded the ruling and said it was looking forward to continuing its
case this week.
commitment serving the citizens of Indiana with the highest standards of
business ethics and professional conduct has always been a priority," IBM
said in a statement Sunday. A company spokesman said Monday that IBM would
have no further comment on the order.
state's attorney, said the judge's order didn't set back the state's case
because it affected only one area of the dispute and not the breach of
contract claims. But he said the state's attorneys disagreed with the
An expert in
contract law generally agreed with Rusthoven.
there are lots of claims that get thrown out and losing on some of those,
you expect that," said Antony Page, a professor at Indiana University's
McKinney School of Law in Indianapolis. "It's possible that the meat of
the complaint is still there."
He said the
state faced an uphill battle to win its claims that IBM's alleged
falsehoods had risen to the criminal level.
to prove that the guy's a liar," Page said. "That's hard to do."
The trial in
Marion County Superior Court began Feb. 27. Rusthoven said the trial
likely will last into next week, and he doesn't expect the judge to rule
for several weeks after that.