Legal Issues and Lawsuits and Law and Technology

IT provider fires back at local not-for-profit

April 4, 2011

Information Technology services provider Beracha Foundation has filed the latest shot in its legal fight with Indianapolis-based Evangelical Baptist Missions Inc.

The Maineville, Ohio-based not-for-profit filed suit in Warren County, Ohio, civil court on Friday, saying EBM breached IT and consulting contracts, among other counts. It is seeking payment of more than $730,000 for the early termination of the contracts, plus real and punitive damages.

The two organizations have been involved in a contract dispute since last fall. In February, EBM sued Beracha in federal court in Indianapolis, alleging that IT provider was holding its website hostage.

EBM, which provides back-office and logistical support for missionaries, accused Beracha of conversion, unjust enrichment, and violation of the anti-cybersquatting act. The suit charged that Beracha refuses to relinquish control of EBM’s Internet domains and website functions unless it receives certain payments.

In its lawsuit, however, Beracha said it has kept its contractual obligations and even renegotiated the contracts after it became clear that EMB was having financial difficulties. Beracha also said it arranged sponsorship agreements to help EBM reduce its IT costs. EBM, the lawsuit said, accepted the sponsorship donations, then began pursuing other IT service providers in violation of the agreement.

Beracha also said it designed and hosted websites for EBM on a lease rather than purchase basis, and the lease agreement cannot be broken unless EBM fully pays its debts to Beracha.

Beracha’ cofounder Dana Dunmyer told IBJ on Monday that EBM doesn’t understand all of Beracha’s work, which included cloud-based hosting and accounting. Based on the federal lawsuit, he said, “You would think it was just a simple website. That couldn’t be further from the truth.”

Dunmyer declined to elaborate on EBM's financial problems, but the lawsuit alleges that EBM failed "to provide full disclosure of its financial position to its missionaries and donors.” Dunmyer also became aware of “bookkeeping irregularities,” the suit says.

Dunmyer said Beracha does control EBM’s domains, but that it has the authority to do so. He said he will turn them over when the missionary organization has someone with the expertise to keep the websites running.

 

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