Will the £318m lie stop IT salespeople lying?

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HP has agreed to pay BskyB £318m in damages six months after a UK court ruled that HP owned EDS had misrepresented its capabilities in delivering a CRM system.

 

The CRM system was ordered in 2000 and the legal battle followed until the court ruled in BskyB's favour in January.

 

BskyB originally claimed for £700m. But HP/EDS has not got off lighltly because the payment is ten times higher than the original cap on liabuility in the contract, which was £35m.

 

A BskyB spokeswoman said both parties have come to mutually agreeable terms and it is now closed.

 

See more on BskyB versus EDS on Tony Collins' blog here.

 

I was wondering how the outsourcing industry might be affected by the case?

 

Obviously misrepresenting capabilities could cost suppliers a fortune but will it stop salespeople lying?

1 Comment

This is a significant amount, and interesting that it won't go to an appeal. I can't see a rush of customers alleging fraud, however it may make any company dissatisfied with the performance of their vendor to go back to any pre-contract discussions and look again at what may have been promised pre-contract. Proving fraud is, however, very difficult and not every company will be able to find a Joe Galloway-type character with the vendor.

Nevertheless, I'm sure we'll all be watching with interest the case reported yesterday on this blog in the US, where again fraud has been alleged.

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This page contains a single entry by Karl Flinders published on June 8, 2010 11:53 AM.

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