The Law Office of Lynnette Ariathurai A Professional Corporation

California Controller sues firm in business contract dispute

Running a business will always have its opportunities as well as its risks. One of the most common situations which entrepreneurs may find themselves in is some type of legal issue related to business dealings. A business contract dispute is one of the most common causes of contention in business. One company in California is currently experiencing this type of dispute and is now facing a breach of contract lawsuit.

The company, SAP Public Services Inc., is being sued by the California Controller in the aftermath of a failed attempt to upgrade the state's payroll system. The international technology firm was awarded the contract to implement software which the firm had developed. However, the initial tests of the software encountered numerous glitches, which required significant troubleshooting. The California Controller eventually terminated the contract with SAP after he was not satisfied with the company's roll-out of the program in Feb. 2013.

The lawsuit filed against the firm alleges that the company did not transfer important knowledge to employees of the state. The plaintiff also claims the defendant company's software system testing was inadequate. The government is further accusing the company of overstating the firm's track record, experience and available talent when bidding on the project.

On the other hand, the company has the right to defend itself in the court of law. There could be a variety of reasons which could explain why the firm is not liable for a breach of contract. However, in order to be successful in the business contract dispute, the company will have to have a complete understanding of all applicable laws. It is also essential to understand how to apply these laws to the specific circumstances in order to craft an effective legal argument.

Source:, Capitol Alert: California Controller Chiang sues firm over failed payroll project, Jon Ortiz, Nov. 21, 2013

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