Saturday, September 1, 2012

Ocean Board of Social Services pays $50,000 to settle breach of contract case

On May 2, 2012, the Ocean County Board of Social Services (OCBSS) agreed to pay $50,000 to a vendor who successfully bid on a two year contract to provide local and long-distance telephone service to three PBX phone systems at the OCBSS' Lakewood, Toms River and Manahawkin offices.

In its suit, Data Networking Services (DNS), a telecommunications service provider out of Tinton Falls, bid on the OCBBS's publicly advertised request for proposal.  According to the suit, Larry Perlberg, who is the lawyer for the OCBSS, was the project manager even though he had "stated he did not understand telecommunications words and their meanings."  Accordingly, he hired Robert E. Hammond of Hammond Consulting Group, LLC of Wall Township as a "go between" between Perlberg and DNS.

According to the complaint, Hammond, at a design review meeting allegedly rejected DNS' design, which employed fiber optic cabling, as "non traditional" and insisted that DNS amend its design to "match exactly the OCBSS existing voice network technology [which was] over 30 years old."  Hammond allegedly required DNS to use "traditional copper circuits" which the suit characterizes as "absurd and wasteful."  DNS also alleged that the OCBBS already had some fiber optic cabling in place but prevented DNS from using that cabling by "falsely claim{ing that they] were dedicated to the local computer network."

While the specifics in the complaint are technical and difficult to understand, DNS alleges, generally, that OCBSS and Hammond deliberately sabotaged its attempts to fulfill the contract and then breached the contract by replacing DNS with a different vendor.

The case is captioned Business Automation Technologies d/b/a Data Network Service v. Ocean County Board of Social Services, et al,  Federal Case No. 3:11-cv-6453 and DNS's attorney was Walter M. Luers of Clinton.  Case documents are on-line here. As part of the settlement, Hammond also paid DNS $5,000.

None of DNS's allegations have been proven or disproven in court. The settlement agreement resolution expressly states that the $50,000 payment does not constitute an admission of wrongdoing by the OCBSS or any of its officials. All that is known for sure is that the OCBSS or its insurer, for whatever reason, decided that it would rather pay DNS $50,000 than take the matter to trial. Perhaps the defendants' decision to settle was done to save further legal expense and the costs of trying what were in fact exaggerated or meritless claims. Or, perhaps the claims were true and the defendants wanted to avoid being embarrassed at trial. This is the problem when cases settle before trial--it is impossible to know the truth of what really happened.