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Will IT soon be facing malpractice suits for failed projects?

This guest post from ZDNet's Larry Dignan asks if Waste Management's lawsuit against SAP could be the beginning of IT malpractice suits. He quotes a recent argument from TechRepublic's Justin James and provides additional resources on the subject from TechRepublic and ZDNet.
This is a guest post from Larry Dignan (right). You can read the original article on Larry's blog Between the Lines on TechRepublic's sister site ZDNet.

Does Waste Management's lawsuit against SAP indicate the beginning of a bevy of IT malpractice suits?

TechRepublic's Justin James makes that argument and it's worth noting. Earlier this week I detailed and posted Waste Management's case against SAP. Much of it revolves around promises made by SAP and Waste Management's penchant to believe them.

But here's James' big point:

I think this case is the canary in the coal mine. Regardless of whether Waste Management wins the case, if the courts allow it to go to trial, programmers are in for a rough ride. Why? If the case is tossed out - particularly on a standard "no warranty implied" contract clause in the software End User License Agreement (EULA) - it means that these pieces of boilerplate legalese provide "cover" for our failures to deliver on a salesperson's promises. If the case makes it to trial, it means that any failed project is probably fair game for a lawsuit.

James, who says he will engage in a bit of CYA in his programming, continues:

Many doctors have to fend off baseless malpractice lawsuits from people hoping to make quick cash from a settlement, since these cases can be so expensive to defend. My fear is that we will soon see this type of environment in IT.

Suing for "programming malpractice" would be like suing an artist because your portrait isn't realistic or flattering or impressive enough for your taste. I hate to sound forgiving of the high failure rate in IT, but programming is not a cut-and-dried practice at this point. It's not like designing a light switch or a stepladder, where it is quite clear if the fault lies with the user, the designer, or the manufacturer.

Even when the project fully meets the specs, it rarely meets the user's needs, since it is so hard to write a perfect project specification and requirements document. In other words, even the most perfect project could be wide open to these kinds of lawsuits.

Even worse, "programming malpractice" suits could drive out what little innovation is left in IT. Programmers will not be willing to write new software unless their company has the deep pockets and slick lawyers to protect them. Open source projects will collapse, since the lack of incorporation will make the individual contributors legally responsible.

James got slapped around a bit for overreacting, but his point is interesting food for thought.

More reading:

From ZDNet: From TechRepublic:
11 comments
jaytm401
jaytm401

As far as I see it, the programming jobs went to India anyway. I am tired of Corporate business letting programmers go after finishing the job. Now they are trying to destroy our way of living too! Let the big business hang them self.. They just toss us out like old trash anyway. Jack the price of programming code to an amount that would cost an Arm and a Leg..... Or Just say no and don't code anything for them. Change Jobs like a lot of IT people are doing now days.... "JUST SAY NO !"

cvicd9
cvicd9

It may weed out poor programmers or those who want a quick coding and get paid disregarding the quality of the product. Poor specs are not the culprit. Accepting poor specs and not inquiring further to grasp the real world problem they will resolve is the culprit. Good questions about the project is key. I can tell you analogies form my main business.

herlizness
herlizness

As I understand the WM case, it's about deceptive trade practices, not about programmer malpractice. The sales guys told WM there were all kinds of things in the box that weren't there. That's got nothing to do with malpractice.

robo_dev
robo_dev

Unless there was outright fraud, pinning the project failure blame squarely on the contractor is both rare and risky for the careers of all those involved. If the contractor was soooo terrible, then the client did not do a good selection process, did they? And if the requirements list kept changing and changing, then cost and time issues are not the fault of the contractor.

Bokfuman
Bokfuman

I work for State Government and see this type of stuff all the time especially when some sales person makes non-technical management believe in something that they cannot provide. At my last department, the company that supplied a helpdesk solution made all kinds of claims of how the system worked so management purchased it with out the IT staff involvement so when it did not work all they had to say was make it work. We spent months getting the software to work in our environment but were not able to use the features that we paid for. Therefore, both parties should look at each other on any large project especially non-technical decision makers with slick sales people.

Justin James
Justin James

I agree. Let's just say that in under about 30 seconds, one can find enough SAP horror stories on the Internet to be considered "duly warned." SAP projects are notoriously high-risk. That's one thing that truly surprised me about this case, was that Waste Management is acting like they had no clue that the project could have failed. Either their entire IT staff is fresh out of college, or they willingly buried their heads in the sand. Regardless, the legal system probably doesn't take that into account. If I get my car repaired by a mechanic with a bad reputation, I still get to sue when it blows up after he's worked on it. J.Ja

jasonhiner
jasonhiner

I've seen exactly those issues play out and lead to a project failure. Nevertheless, I do think once companies have it in their minds that they CAN sue a contractor for a failed IT project, then we could start seeing more of this. So I think IT companies need to keep a close eye on this potential trend.

robo_dev
robo_dev

Isn't it amazing how things integrate seamlessly in a PowerPoint vendor presentation?

NotSoChiGuy
NotSoChiGuy

In my opinion, the lack of due diligence on the part of Waste Management wasn't the worst of it; especially if you buy into their contention that the sales pitches put on by SAP were tremendous snow jobs. We've all seen extra swarmy sales guys do their thing. For the record, I don't buy into this at all; but I'm bringing it up for sake of equity. The real thing that is astounding is how long they let the project continue before they seemed to realize there was a massive problem. Where was the risk management? Where was project leadership questioning/pushing the project progress? Where was senior leadership questioning where the $$$$ was going? This was an organizational failure of the highest magnitude (note to self: ensure that Waste Management is not part of retirement portfolio). While I do think SAP should be held accountable for underhanded business practices (particularly after reassessing the situation, and stating that the current product wouldn't work, and they'd have to start from scratch...unfathomable how they remain in business), I don't think Waste Management should get back the entire amount they're asking for. In terms of precedent, I can see firms trying to engage in lawsuits. However, this will be quickly countered by even greater legalese in contracts and support agreements; making lawsuits tougher to bring forth and win.

Locrian_Lyric
Locrian_Lyric

firm hired for a small job. company decides to fike a 'malpractice' suit. company offers to drop the suit if IT firm just walks away (without getting paid) Business gets free IT work done.

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