EDS misrepresentation ruling ‘a wake-up call’ for vendors

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EDS misrepresentation ruling ‘a wake-up call’ for vendors

Postby Gus Sainz » Thu Jan 28, 2010 2:59 pm

High Court ruling in favour of BSkyB will encourage vendors to tighten procedures on selling and contracts, legal expert claims
This week's legal victory for broadcaster BSkyB against IT services supplier Electronic Data Systems (EDS, now HP Services) will have serious repercussions on how IT service providers bid for contracts, according to a leading industry lawyer.

BSkyB accused EDS of misrepresentation, claiming that it was mislead over the time and cost required to complete a customer relationship management (CRM) deployment that began in 2000. Of the five related accusations, only one – that EDS misled its client on the time to delivery – was upheld.

The total amount that HP Services, as it now known since its acquisition by Hewlett-Packard in 2008, will have to pay BSkyB is yet to be decided, but the broadcaster anticipates that the sum will be in excess of £200 million, despite the contract’s liability cap being set at £30 million. As it was judged that EDS deceived BSkyB, this limit ceases to apply.

The accusation that managing director of CRM for EDS at the time, Joe Galloway, misled BSkyB about how long it would take to complete the work was upheld after it emerged that he had lied in court about the nature of his academic degree.

He claimed that he had attended Concordia College in the US Virgin Islands in person, when in actual fact Galloway had obtained his qualification from the 'diploma mill' institution via the Internet. This was proved when Mark Howard QC managed to procure a similar degree for his pet dog during proceedings. Following this revelation, the judge ruled that Galloway’s credibility as a witness had been destroyed.

EDS misrepresentation ruling ‘a wake-up call’ for vendors
Gus Sainz
Gus Sainz
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