Indiana court to hear appeal in IBM welfare lawsuit

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A panel of three judges will hear Indiana's appeal of a lower court ruling ordering it to pay IBM Corp. $52 million over a failed welfare privatization project.

The Indiana Court of Appeals will take up the matter Monday. Both sides will have 45 minutes to present their cases.

Former Gov. Mitch Daniels outsourced the intake of welfare clients to a team of private contractors led by IBM in 2006. He canceled the 10-year, $1.37 billion contract with Armonk, N.Y.-based IBM in 2009 amid widespread performance complaints from clients, their advocates and federal officials.

The state sued IBM for breach of contract and the company countersued. A Marion County judge ruled last year that neither side deserved to win but awarded IBM $52 million, far less than it was seeking.

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