The state's lawsuit against a failed IT developer will play out in Hawaii court

The state's lawsuit against a failed IT developer will play out in Hawaii court

HONOLULU (HawaiiNewsNow) - In 2008, the Hawaii Department of Transportation contracted Ciber Inc., an IT development company, to create a new financial services software system for the department.

After the state paid $7 million in costs, the company allegedly abandoned the project in 2014 with the software unfinished, according to the Department of the Attorney General.

Lawsuits were then filed by both parties, alleging breach of contract, unfair competition and other violations.

"HDOT's case described, among other contentions, how internal Ciber documents reflected that Ciber managers had admitted that Ciber's team lacked necessary technical skills, made critical mistakes during the project, and misled HDOT about the quality of Ciber's work and the ability of Ciber's team to deliver a working system," the Department of the Attorney General said in a news release.

Through the suit, the state has already recovered $11 million from the company — which filed for bankruptcy in 2017 — and their insurers, but further litigation is pending.

The state is still seeking additional compensation from Ciber's insurers. The insurers filed a motion to move the pending litigation out of state, but a recent order will keep the case in Hawaii court.

"Having the case remain in Hawaii is important to maintain the State's ability to control the procurement process and makes it easier to enforce these contract requirements in court," Attorney General Suzuki said.

"Moving the litigation to a jurisdiction on the mainland would have added significantly to the cost of pursuing the case against the insurers because all of the State's witnesses and evidence are here in Hawaii," Suzuki added.

The $11 million of money already recovered far exceeds what HDOT paid Ciber for the system, the state added. $1 million came from Ciber, and the other $10 million was paid by Ciber's insurers.

Ciber remains in bankruptcy proceedings.

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