On Wednesday, June 23rd, 2010, the Wynn Las Vegas LLC sued IBM Corporation over a $9.7 million contract disagreement. The executive staff at the Wynn Las Vegas, including the owner, disputed that IBM overcharged them for use of their MAXIMO software which was developed by MRO Software, a subsidiary of IBM.
The Use of the Software
The lawsuit was filed with the federal court in Las Vegas. The software was purchased by Wynn Las Vegas in order to log and track the numerous work orders, inventory of materials, equipment needs and a few other maintenance purposes.
What was the Main Issue with the Software?
Wynn, LLC states that they paid hundreds of thousands of dollars for the initial software package and the various upgrades since its implementation. They’ve constantly endured system crashes and various other problems. As a result, IBM conducted an audit on the software in late 2009/early 2010 to verify bugs and other problems.
The contract between the two companies was that Wynn would set up 500 tier-1 users of the program. Wynn claimed that none of the configurations IBM setup met the definition of a tier-1 user. IBM later demanded that the hotels had to purchase an additional 2,000 licenses at a cost between $2,300 and $4,600 a piece.
click here to see most Popular PagesIBM’s Justification of the Costly Bill
According to IBM, they were charging for every employee that had been using the MAXIMO software including the housekeepers that merely utilized the program to report on guest maintenance requests. IBM claimed that even these individuals must have a copy of their own license.
The Wynn’s Prerogative
The defense by Wynn lawyers is that IBM was using “bait and switch” tactics by dangling upgrade incentives without honoring the Wynn’s right to use the program at various permission levels in which the hotel had earlier acquired. The Wynn LLC is viewing these claims as absurd and unwarranted. IBM has pestered the casino for many months, demanding $9.7 million for past and future use of the software.
Although the allegations seem to be valid, IBM has still yet to comment on the matter. Therefore all facts are not yet out in the open for discussion. When two major corporations take matters to court, the intricacies of the case are numerous. This is a situation that will immediately be settled or will linger in court for many years to come.
