DisputeSoft was engaged as a testifying expert in December 2020 by Continental Casualty Company (CNA), Liberty Surplus Insurance Corporation, and Aspen Managing Agency Limited in the matter of Hawai‘i Department of Transportation v. Continental Casualty Company et al. 

    DisputeSoft was asked to assist in this arbitration involving a dispute over the reasonableness of a settlement agreement in a software failure lawsuit between the Hawai‘i Department of Transportation (HDOT) and Ciber, Inc.

    Beginning in September 2008, HDOT contracted with Ciber to design, configure, and install a replacement to HDOT’s outdated, COBOL-based financial management system. HDOT terminated the contract on March 9, 2015, complaining that Ciber had failed to deliver a functional system within the expected timetable. 

    Ciber then sued HDOT in Hawai‘i state court for wrongful contract termination, alleging that HDOT’s failures to elicit and document its business requirements, provide enough knowledgeable staff to support the project, and timely extract and cleanse financial data from its legacy system had delayed project completion. 

    HDOT filed a counterclaim, alleging that Ciber’s consultants had mismanaged the software implementation and lacked the technical skills and experience needed to implement HDOT’s business requirements.

    In 2017, while the state court lawsuit was still pending, Ciber filed for Chapter 11 bankruptcy. During subsequent settlement negotiations, Ciber agreed to a $46 million judgment in HDOT’s favor. Of this amount, Ciber, along with its primary liability insurance provider, collectively agreed to pay $11 million. 

    Ciber then assigned to HDOT the right to seek recovery for the rest of the judgment from its secondary insurance carriers, CNA, Liberty, and Aspen, none of whom took part in the settlement discussions.

    When the secondary insurance carriers denied payment, HDOT initiated arbitration proceedings against them. CNA, Liberty, and Aspen subsequently engaged DisputeSoft to investigate the reasonableness of the $46 million settlement amount, evaluate HDOT’s claim that Ciber was solely responsible for the project’s failure, and examine the validity of the damages alleged by HDOT.


    DisputeSoft’s Services

    As software experts, DisputeSoft:

    1. Researched project status reports, e-mail correspondence, and reports of third-party consultants to establish that HDOT’s conduct impeded Ciber from delivering the project on schedule.
    2. Evaluated procurement documents to determine whether they adequately expressed HDOT’s business requirements.
    3. Reviewed project cost documentation to determine the validity of HDOT’s damages claim.
    4. Researched records of HDOT’s procurement of a replacement vendor to validate the accuracy of HDOT’s estimated cost of system replacement.

    DisputeSoft Founder and Chief Advisor Jeff Parmet submitted an expert report and rebuttal report on behalf of the secondary insurance carriers, opining that Ciber’s willingness to settle the lawsuit for $46 million was unreasonable given the evidence of HDOT’s missteps on the project. HDOT entered into settlement agreements with CNA, Liberty, and Aspen in April and May 2021, shortly prior to the arbitration hearing.

    Learn more about our Software Project Failure Services

    DisputeSoft provides software project failure expert witnesses services to law firms engaged in complex software disputes.

    Related Experts: Jeff Parmet, Tom Ashley, Kimon Yiasemides

    Service Areas: Software project failure, Liability insurance

    Industry: Insurance; Transportation