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Judge Hears Closing Arguments In IBM v. Indiana


Photo: TSelrahc (Flickr)

IBM and the state of Indiana are suing each other to recover lost funds.

After six weeks of trial and nearly 100 witnesses, attorneys for the state of Indiana and technology company IBM made their closing arguments in Marion County court Tuesday.

The state signed a contract with IBM in 2006 to modernize Indiana’s welfare system. But three years later, the state cancelled the contract, citing numerous problems with the system and claiming IBM failed to live up its agreement.

IBM and the state then sued each other, looking to recover money.  In closing arguments, attorneys for the state say IBM looked out for its shareholders at the expense of a million needy Hoosiers, and the state’s attorney Peter Rusthoven says the computer giant has continually tried to pass the blame.

“‘Oh it’s the state’s fault, oh it’s ACS’s fault, oh no it was the bad weather, oh it was the economy.’  You’re hearing all of that over and over and over again,” he says.

But IBM attorney Steve McCormick says when the state started slashing its budget, it actively looked for a way to force IBM out of the contract.  He says Indiana only focused on a few sub-par standards, rather than the bulk of what IBM had done.

“We delivered welfare-to-work. We delivered anti-fraud. We delivered lower administrative costs.  We delivered the paperless system,” he says. “We delivered a thousand jobs to Indiana.”

The state seeks to recover more than 170 million dollars in damages, while IBM is asking for about a 113 million dollars. The judge’s ruling is expected this summer.

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