CourtCanada Ltd.

July 12, 2010 15:26 ET

Toronto tech startup suing government

Ministry accused of sabotaging software system

Attention: Business/Financial Editor, News Editor, Tech/Telecomm Editor, Government/Political Affairs Editor TORONTO, ONTARIO--(Marketwire - July 12, 2010) - Canadian software company CourtCanada Ltd. has sued the Ontario Ministry of the Attorney General for $12 million in damages, including $2 million in punitive damages for a "malicious" attempt by the Ministry to harm the operations and reputation of the Toronto-based technology start up.

CourtCanada has operated the Online System for Court Attendance Reservations (OSCAR) since October 2007. Initially introduced as a pilot project in Toronto, the web-based court scheduling system provides free public access to court room schedules and other information. OSCAR also enables legal professionals to search for available court time and reserve attendances online, on a "pay-per-use" basis.

In December 2008 the company won the opportunity to expand the system through a competitive bidding process. CourtCanada agreed to provide the system to the Ministry, at no charge, for "back office" court room schedule management and administration. This arrangement provided the government with high performance technology at no cost to taxpayers.

In accordance with the Ministry's demands, CourtCanada financed OSCAR's development and built an operating infrastructure with the capacity to service the entire province. The company expected to earn a return on its multi-million dollar investment as OSCAR was expanded through the province.

OSCAR has helped fill the void left by the spectacular failure of Ontario's Integrated Justice project. By the time of its demise in 2002, the government had wasted an estimated $300-million to produce little more than a collection of lawsuits and a technological stagnancy within the Ontario justice system that has lasted almost a decade.

In early 2009, OSCAR was expanded to the high-profile Commercial List division, the Toronto court which hears many of the country's largest business disputes. CourtCanada was then directed to commence the pre-deployment process in other divisions in Toronto.

However, CourtCanada claims that the Ministry then delayed expansion for almost a year until this past March, when it notified the company it was terminating further expansion. The Ministry gave no explanation for its decision, and in fact confirmed its satisfaction with the company's performance.

CourtCanada notified the government that its refusal to allow further expansion breached its contract. The company alleges that the Ministry then took action intended to 'manufacture' a justification for the breach by "deliberately and systematically" interfering with the integrity of OSCAR.

CourtCanada only learned of the Ministry's actions a few days later - through the deluge of user complaints that followed. However, once the company learned of the issue, it quickly identified the cause. "Our servers log details of every transaction made through OSCAR," says Gregory Azeff, the company's co-founder and president.

"Our records indicate that over the course of about a day and half, the Ministry systematically and deliberately altered a large amount of data in OSCAR, and published information it knew to be misleading and prejudicial," continues Azeff.

The allegations in the company's Statement of Claim have not been proved in court.


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