CPF sues IBM over failed IT project
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July 6, 2006
CPF sues IBM over failed IT project
But IBM claims board continually changed specifications it wanted; damages may go over $40m
By Chong Chee Kin
THE Central Provident Fund (CPF) Board is taking computing giant IBM to court in a civil suit over a failed IT project it claims the company did not complete.
The saga began with IBM winning a $32-million contract in 2001 to design and build a new IT system for CPF. Court documents obtained by The Straits Times show that the dispute arose not long after the project began.
The contract required IBM to 'design, develop and supply' a new software system to replace its existing system by December 2004.
However, CPF claimed that 10 months after IBM secured the contract, the company said it needed more time to work on the system.
The date for completion was then pushed to December 2005.
The first phase of the project was due to be completed in December 2003, but IBM did not deliver, CPF claims. Despite giving it more time - first by extending the deadline to April 2004 and then to August - IBM was unable to complete the project.
The contract was terminated in August 2004.
CPF is asking the court to assess the damages caused by the delay, an amount that could go over $40 million.
In its suit against IBM, CPF claims it suffered as a result of IBM's failure to deliver the new system on time and as needed.
It is also trying to recover the $3 million it paid IBM for the first stages of the work, because it 'obtained no benefit from the expenditure' of this sum.
The board is also claiming for additional costs, such as manpower, hardware or software provided by CPF for IBM's use and wants IBM to cover the additional costs it will incur to engage a new vendor to supply the IT system it needs.
In its defence and counterclaim against CPF, IBM says that CPF caused the delays by continually changing the specifications it wanted in the new system.
It claims that instead of an upgrade, the board demanded changes that required more time and effort, which delayed the completion of the project.
IBM is claiming more than $38 million from CPF for the work it carried out.
CPF is represented by a team led by Senior Counsel K. Shanmugam, and partners Andrew Yeo and Kenneth Pereira of Allen & Gledhill, while IBM is represented by Thio Shen Yi of TSMP Law Corporation.
The lawyers are due to return to the High Court on Aug 11.
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poor IBM.
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Sayonara IBM.
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wah siao
if they lose then will my thinkpad become more asspensive!??!?!!? -
When they handed part of their business to lenovo, it was a sign of not so good things to come.
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This'll be interesting.
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wonder which SI is bidding for the system that IBM screwed up ? cool 90 million ...darn thata alot of money for a portal system.
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confirm not NCSOriginally posted by one-niner:wonder which SI is bidding for the system that IBM screwed up ? cool 90 million ...darn thata alot of money for a portal system.
it could be IBM direct since it's such a big project -
why still IBM ..IBM Services already been sued their pants off in this suit.Originally posted by FireIce:confirm not NCS
it could be IBM direct since it's such a big project -
see where the taxpayers money go..........
32million IT project! -
haha that is small ..DoD spent close to USD $1 Billion to centralize their entire inventory and supply chain...then the vendor failed to deliver due to sheer size of the project and the requirements.
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I think the interesting part is about the lawsuit. CPF have hired Allen & Glenhill as their legal counsel and IBM have engaged TSMP as their legal counsel. It is going to be a tough fight as IBM have enagaged one of the best lawyer, Thio Shen Yi to defend them. Allen & Glenhill has three lawyer, one of them senior counsel and the other one who used to be the legal officer for dell Asia, to fight for the case. I think CPF is not very sure in winning this case and that why they have three lawyers against one.
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oei! it's CPF u know!
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wanna bet for this case?
i be bookie. come come.
odds for ibm is 1:3 and CPF is 1:2.
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CPF is going to win ..GOV Stat board ..come on ...or they could reach an artribation on the issue.
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you like thinkpad huh? the features and specs not as good as acer and other brands leh..Originally posted by FireIce:wah siao
if they lose then will my thinkpad become more asspensive!??!?!!?
Anyway, thinkpad no longer under ibm right? -
question now is whether the government wants to lose for US oand/or the world to think of the judicial system as fair in singapore or to win it for the stat board
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IBM has been moving away from their hardware business towards software .... neways, hardware especially home machines and lappies is a low growth, lower end business nowOriginally posted by oxford mushroom:you like thinkpad huh? the features and specs not as good as acer and other brands leh..
Anyway, thinkpad no longer under ibm right? -
They may and can win many legal matters within Singapore.
But once out of Singapore, they're powerless. -
Terminate the contract in 2004, suing now?
CPF is nuts, so much money don't know how to use? -
It's not the quantity lah...Originally posted by latterrain:I think the interesting part is about the lawsuit. CPF have hired Allen & Glenhill as their legal counsel and IBM have engaged TSMP as their legal counsel. It is going to be a tough fight as IBM have enagaged one of the best lawyer, Thio Shen Yi to defend them. Allen & Glenhill has three lawyer, one of them senior counsel and the other one who used to be the legal officer for dell Asia, to fight for the case. I think CPF is not very sure in winning this case and that why they have three lawyers against one. -
It's probably a weak case, that's why they need 3 lawyers.
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they want to sue for full(not stated) damages? imo i think they will be successful for sueing for normal damages and causation only, as i guess theres partial work done
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i think theres a time limit which you can sue someone when the contract is frustratedOriginally posted by ndmmxiaomayi:Terminate the contract in 2004, suing now?
CPF is nuts, so much money don't know how to use?
and the money is not very little you know -
Sorry guys i am not a legal guy and anywhere near drafting a contract.
But i do belive definintely a company like IBM will be ensuring that their lawyers pour over the clauses within the contract to ensure a fair deal in their right and make sure they CYA.
So any legal skillset ppl care to comment abt the type of damages CPF is going out against IBM etc ?