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Online lingerie seller claims JDA software didn't provide even the bare necessities

Chris Kanaracus | Dec. 16, 2013
Mergers and acquisitions can have an impact on deals based on product road maps, analyst says

By January of this year, Andra Group had spent about US$1.6 million on the project, and by February the transition plan had ballooned to more than 500 pages.

JDA officials "clearly needed an 'out,'" the suit alleges. In mid-February, JDA "abruptly reversed course" and began delivering progress reports that cited "significant problems with the budget, timing and overall status of the project for the first time," the suit states. "It was now clear that JDA could not, and would not, deliver on the promises made by RedPrairie or the contract it had signed."

JDA subsequently met with Andra Group and proposed rewriting the contract "and essentially re-bid the entire project from scratch," with Andra Group's costs rising by $1 million and the go-live delayed to early 2014, according to the suit. The final product would also be less functional than Andra Group's legacy system, which would have to remain in lockdown mode for another year, it claims.

After Andra Group refused, "JDA made it clear that it preferred to abandon the project entirely," the suit states. JDA also attempted to shrug off their "massive failures" and treated Andra Group officials "with contempt and condescension," it claims.

JDA initially agreed to repay "substantially all" of the money Andra Group had spent but subsequently reneged on the deal, refusing to give back no more than a "small fraction" of the money.

Andra Group has suffered at least $4 million in damages on top of the $1.6 million it spent on the project, according to the suit.

The action seeks compensation for Andra Group's expenses and damages related to the project, as well as attorney's fees and court costs.

JDA hadn't filed a response to the suit as of Friday. The company didn't respond to a request for comment on Andra Group's allegations.

This may be a case where someone made promises to Andra Group based on a product road map that ultimately couldn't be delivered, said analyst Ray Wang of Constellation Research.

"It's not uncommon for things like this to happen," particularly when mergers and acquisitions come into play, Wang said.

Customers can protect themselves by having a third party do a deep vetting of the products they are interested in buying, Wang added. "This is one of the dangers of sole-sourcing," he said. "With only one throat to choke, you don't get that outside opinion on what is real."

 

 

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