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Topic # 183791 30-Oct-2015 11:05
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We have a 3 year contract for software with a vendor. It has not worked well, and they have not offered us the support promised in that time. 

We told them we wanted to terminate the contract nearly 18 months ago, and the executive team had a conference call promising they would fix the issues and we wouldn't pay any more until they were all fixed. They gave us a bunch of free consulting
time which didn't end up happening because they said the product didn't do what we had been told. That process took 12 months, though they told us we had to start paying again after 3 months.

We have continued to wait for them to fix the issues, but it's now nearing the end of the contract, and we have gone back to say we would like another 3 month credit which they have refused. This basically is to make the product "most cost effective" which partially reflects functionality which doesn't exist nor likely ever will.

We are wondering on our legal options. One option for us is to tell them we now need to go back to the discussions of 18 months ago, and refund us the monies paid and the interest on those monies. They keep just saying they won't issue us the credits we had asked for.
The other is a complete refund of the product.

Anyone here had any experience with legal action internationally? Ideally USA specifically? 

I understand I will likely need to consult a lawyer at some stage, but I was keen to know if anyone had done this etc.

We believe we have proof of a fundamental breach of contract. We also believe we were mislead as to key functionality that doesn't work as was described.

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  Reply # 1416893 30-Oct-2015 11:50
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The obvious thing is to immediately stop paying them. This will focus their minds on your problem. So long as you keep paying, *they* have no problem.




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  Reply # 1416898 30-Oct-2015 11:59
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frankv: The obvious thing is to immediately stop paying them. This will focus their minds on your problem. So long as you keep paying, *they* have no problem.



We have stopped paying them, but they have said they will switch our system off remotely if we don't complete our contract.

I have yet to re-involve the CEO again, because if he stands by the stance of his finance department, we are forced to litigate, which depending on cost/complexity could be a serious problem.


 
 
 
 


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  Reply # 1416941 30-Oct-2015 12:23
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networkn:


Anyone here had any experience with legal action internationally? Ideally USA specifically? 



Consulting with your legal people would be step no. 1. But your contract should have a clause in it somewhere which specifies this. For example, it should say that the contract shall be bound by New Zealand law, and that disputes shall be settled in New Zealand courts (or at a binding arbitration or under US law in a US court ... etc.). In summary: your contract should already tell you what your legal options are.

We (speaking from my experience with negotiations with our vendors) would typically write our contracts to specify that everything shall be bound by New Zealand law and the New Zealand courts. But we are big enough to have an in-house legal team to hold our hands. If you signed a boilerplate license agreement with a US company then it's probably the other way around - you might even be disarmed near completely if they are a really big company.

Anyway -- talk to a lawyer!




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  Reply # 1416942 30-Oct-2015 12:25
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networkn:
frankv: The obvious thing is to immediately stop paying them. This will focus their minds on your problem. So long as you keep paying, *they* have no problem.



We have stopped paying them, but they have said they will switch our system off remotely if we don't complete our contract.

I have yet to re-involve the CEO again, because if he stands by the stance of his finance department, we are forced to litigate, which depending on cost/complexity could be a serious problem.



You should also be careful with this no-pay tactic unless your contract spells out specific circumstances in which you are entitled to do so. From the courses they make us take every year I seem to remember it being unlawful to not hold up your end of the contract even if you can prove the other guy isn't holding up his.




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  Reply # 1419358 2-Nov-2015 22:48
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Networkn: Suing a American Company

No experience. But check your agreement. You may have given up that right already. A growing number specify binding arbitration.

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