Monday, March 29, 2004

Cleveland State U. Resubmits Lawsuit Against PeopleSoft, Seeking $510-Million

By DAN CARNEVALE / from the Christian Science Monitor

Cleveland State University is suing PeopleSoft and a consulting firm in state court, alleging fraud and breach of contract that the university says led to millions of dollars' worth of problems with a campus-wide installation of management software.

The university is seeking $510-million from PeopleSoft, which provided the software, and at least $25,000 from Kaludis Consulting, a company that helped Cleveland State buy the software and prepare to use it. The lawsuit was filed in January, but was not announced.

Problems between Cleveland State and PeopleSoft go back to the mid-1990s, when the university purchased an early version of PeopleSoft's software on a recommendation from Kaludis. University officials said at the time that frequent glitches in processing financial-aid and student records frustrated students and caused problems for faculty and staff members.

Cleveland State had filed a lawsuit against Kaludis in 2002, and the consulting firm was able to bring in PeopleSoft as a defendant. Cleveland State later withdrew the lawsuit with the understanding that the university could resubmit it at a later date.

The latest lawsuit was filed on January 30 at the Cuyahoga County Common Pleas Court by the Ohio attorney general's office, which is representing the university. Officials from Cleveland State and PeopleSoft would not comment on the litigation.

George Kaludis, chairman and president of the consulting firm, would not discuss the specifics of the case, but he said the problems Cleveland State experienced stem from flaws in the PeopleSoft software. Other institutions -- such as Boise State University , Ohio State University, and the University of Wisconsin at Madison -- also reported having trouble with the software in the 1990s.

"We were surprised that they filed it again," he said of the lawsuit. "The allegations are untrue about us."

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