Indiana Supreme Court
State of Indiana, Acting on Behalf of the Indiana Family & Social Services Administration v. International Business Machines Corporation
49S02-1408-PL-513.
Civil plenary. Reverses trial court ruling that IBM was not in material breach of its master services agreement to administer Indiana’s welfare systems under a $1.3 billion contract that the state terminated for cause. Summarily affirms the Court of Appeals on all other issues: affirming the trial court’s award of $40 million in assignment fees and $9,510,795 in equipment fees to IBM; affirming the trial court’s denial of deferred fees to IBM; and reversing the trial court’s award of $2,570,621 in early termination close out payments and $10,632,333 in prejudgment interest to IBM. Remands to the trial court to determine the amount of fees IBM is entitled to for two change orders, and for calculation of the parties’ damages, including any appropriate offsets to the state as a result of IBM’s material breach of the MSA.