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Company sues Nebraska over canceled contract

March 6, 2019

LINCOLN, Neb. (AP) — A company has sued Nebraska over the cancellation of a state contact for an $84 million upgrade to the state’s Medicaid eligibility and enrollment computer system.

India-based Wipro Limited filed a lawsuit against the state Monday in Lancaster County District Court, alleging Nebraska hasn’t paid $15.5 million for work that was completed before the project was halted in September, the Lincoln Journal Star reported.

“Despite repeated requests from Wipro, the state has failed to timely pay the Wipro invoices, which remain due and payable by the state, together with unpaid interest,” the complaint said.

The company, which has its U.S. headquarters in New Jersey, is also seeking $3 million in lost revenue and nearly $12 million in damages to its reputation.

State officials declined to comment to the newspaper. The state has spent about $6 million on the project.

Wipro alleges the state Department of Health and Human Services didn’t provide a “factual basis for the suspension” in its September cease-and-desist letter. The state officially terminated the contract in December.

The cancellation came after First Data, a company the department hired to review the project, found that work was on budget and on schedule, the lawsuit said. The Nebraska Information Technology Commission also gave the project a positive rating in August, the complaint said.

Wipro was later informed that the decision was based on an earlier brief written by First Data before it gave the project a favorable review, the lawsuit said.

The project started in 2014 as a way to bring the state in line with standards set by the Affordable Care Act. It was scheduled to be completed in February.

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Information from: Lincoln Journal Star, http://www.journalstar.com

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