Jury Verdict against Ross Systems Returned in Sunshine Mills Lawsuit
06 December 2010 - 11:10PM
Business Wire
Ross Systems, Inc. announced today that a jury in the
Franklin County Circuit Court of the State of Alabama returned a
verdict on Dec. 3, 2010, in litigation between Ross Systems,
Inc. and Sunshine Mills, Inc., a major employer based in Red Bay,
Alabama. In the lawsuit, Sunshine Mills alleged fraud related to
the sale and implementation of a beta Ross ERP system in early
2005. The jury awarded a total of $61 million in damages to
Sunshine Mills, of which approximately $16 million were
compensatory damages, and $45 million of which were punitive
damages. Ross denied these allegations and plans to appeal the
verdict.
The jury reached this result despite the fact that:
- Sunshine Mills acquired the Ross ERP
beta system in 2005 and used the product for years before filing a
lawsuit;
- The Ross ERP system continues to be
used by Sunshine Mills to this day;
- Sunshine Mills has recently purchased
services from Ross Systems to help them in their operations;
and
- The software at issue is being used
successfully by many of Ross’ national and global customers, and
has been for years.
“This is a sad day for the software industry,” said Sherri
Rodriguez, president of Ross Systems. “These types of unfair
judgments make it more and more challenging for software companies
to operate. However, we will continue to focus on providing our
thousands of customers with the world-class products and services
they deserve and have successfully used for years. Moreover, our
proven track record of delivering quality products and services to
our many satisfied customers has led to consistently high
maintenance retention rates over the years.”
“We feel that the jury’s award is contrary to the evidence and
is excessive, especially since our enterprise license agreement
with Sunshine Mills amounted to only about $235,000,” said Kenneth
Thompson, general counsel of Ross Systems. “We plan to appeal and
pursue every avenue available to us to overturn the verdict and to
minimize, to the fullest extent possible, the amount of damages for
which the company may ultimately be responsible. We are confident
that justice will be served.”
A jury in the Franklin County Circuit Court of the State of
Alabama returned a verdict on December 3, 2010, in litigation
between Ross Systems, Inc. and Sunshine Mills, Inc. Sunshine Mills
alleged various tort-based and other causes of action relating to
the sale and implementation of a Ross ERP system for which Sunshine
Mills had paid approximately $235,000. Ross Systems denied the
allegations, alleging that Sunshine Mills knowingly purchased a
beta version of the software and that Sunshine Mills’ claims were
subject to various limitations contained in the agreement between
the parties.
About Ross Systems
Ross Systems was acquired by CDC Software (NASDAQ: CDCS) in 2004
and is a business unit of this global provider of hybrid enterprise
software applications and services. CDC Corporation (NASDAQ: CHINA)
owns approximately 85 percent of CDC Software.
Cautionary Note Regarding Forward-Looking Statements
This press release includes "forward-looking statements" within
the meaning of the United States Private Securities Litigation
Reform Act of 1995, including statements relating to, among other
things, our beliefs regarding the Sunshine Mills litigation,
including the outcome thereof, our beliefs regarding the nature and
propriety of the jury verdict and our plans to seek a reversal of,
or reduction in, the verdict, our beliefs regarding the appellate
process and our bases for appeal, our expectations and plans
regarding our business and customer focus, and other statements
which are not historic fact. These statements are based on
management's current expectations and are subject to risks and
uncertainties and changes in circumstances. There are important
factors that could cause actual results to differ materially from
those anticipated in the forward-looking statements, many of which
are outside our control, including (a) the risk that we will not
prevail in our future efforts with respect to this matter,
including our efforts to reverse or reduce the jury’s award, or
that we will not prevail on appeal; (b) the risk of any potential
impact a verdict in this case may have on other disputes we now or
may in the future have outstanding; (c) the potential impact on our
business and customers; (d) the ability to make changes in business
strategy, development plans, product offerings and other matters
and to respond to the needs of current, new and potential
customers, suppliers, strategic partners; (e) the ability to
integrate operations or new acquisitions in accordance with the
company's and its subsidiaries’ business strategies; (f) the
effects of restructurings and rationalization of operations; (g)
the ability to address technological changes and developments
including the development and enhancement of products; (h) the
ability to develop and market successful products and services; (h)
the entry of new competitors and their technological advances; (i)
the need to develop, integrate and deploy products and services
that meet customer's requirements; (j) the possibility of
development or deployment difficulties or delays; (k) the
dependence on customer satisfaction with the company's and its
subsidiaries’ products and services; (l) continued commitment to
the deployment of the company’s and its subsidiaries’ products and
services, including enterprise software solutions; (m) risks
involved in developing software solutions and integrating them with
third-party software and services; (n) the continued ability of the
company's enterprise software solutions to address client-specific
requirements; and (o) demand for, and market acceptance of, new and
existing enterprise software and services and the positioning of
the company's solutions. Further information on risks or other
factors that could cause results to differ is detailed in CDC
Software Corporation’s filings or submissions with the United
States Securities and Exchange Commission, and those of our
ultimate parent company, CDC Corporation. All forward-looking
statements included in this press release are based upon
information available to management as of the date of the press
release, and you are cautioned not to place undue reliance on any
forward looking statements which speak only as of the date of this
press release. The company assumes no obligation to update or alter
the forward looking statements whether as a result of new
information, future events or otherwise.
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