State’s claim against Ciber advances

Hawaii’s Department of Transportation says it can move forward with a claim in court against an information technology company for allegedly defrauding the state and causing millions of dollars in damage.

Ciber Inc. was hired to upgrade the Transportation Department’s computer accounting system for its Highways Division, but failed to turn over a working system while collecting more than $8 million in fees from the state, the DOT said in a news release Monday.

The state terminated Ciber’s contract in 2015 after it abandoned the project, the DOT alleged.

Ciber filed a lawsuit in September, accusing the state of improper termination and breach of contract. The state filed a counterclaim in that case in November.

On Feb. 15, Circuit Judge Edwin Nacino rejected several of Ciber’s challenges to the state’s counterclaim. The challenges were in response to the state accusing the company of fraud, unfair competition and False Claims Act violations by submitting false invoices to the state, according to the release.

DOT Director Ford Fuchigami said in a statement that the ruling “marks a big step forward in the state’s case and we will continue to fight on behalf of Hawaii’s residents.”

Robert Klein, who represents Ciber, said the judge merely ruled that the state’s fraud allegations could not be dismissed. But the judge did dismiss claims by the state against Ciber for negligent misrepresentation and breach of the implied covenant of good faith and fair dealing.

The state filed its own suit against Ciber in September, but a judge threw out the case in October, saying the DOT should have filed a complaint with a chief procurement officer before filing the lawsuit.

Klein said in an email that the DOT’s “excited announcement” was a “vain attempt to recover from the embarrassing dismissal of its original complaint for failing to follow the law.”

“The dismissal of the state’s complaint resulted in the state having to pay Ciber $16,500 in attorney’s fees,” he added.