Indiana's human services agency is paying $5.25 million to a private law firm, including the brother of a key aide to
Gov. Mitch Daniels, to represent the state in its fight over a canceled IBM Corp. welfare outsourcing contract.
Barnes & Thornburg of Indianapolis was hired despite several conflicts of interest arising from the fact that it also
represents former IBM partners involved in the welfare deal. Bryan Corbin, a spokesman for the state attorney general's
office, said in an e-mail to The Associated Press that "hiring this firm was a specific request of the Governor's
Office."
Daniels' press secretary, Jane Jankowski, said the hire "made the most sense given the scope and complexity of the
case."
The law firm's contract with the Family and Social Services Administration outlines its conflicts, and Barnes & Thornburg
even suggests in the document that the agency consider hiring a co-counsel to handle conflict-of-interest issues as needed.
The contract was obtained by the AP.
"They're very good litigators and that's why they were chosen," family and social services spokesman Marcus
Barlow said of Barnes & Thornburg. Barlow said the $5.25 million is "a small fraction" — less than 1 percent
— of the $1.3 billion in damages the agency is seeking from IBM.
Indiana House Speaker Patrick Bauer, however, called it foolish for the agency to hire outside counsel when the Indiana attorney
general's office could represent it for no cost in attorneys' fees.
"To spend another $5 million is bad money after bad money, and the taxpayers are the losers," said Bauer, a Democrat
from South Bend.
Daniels, a Republican, fired Armonk, N.Y.-based IBM last October from a 10-year, $1.37 billion contract to introduce call
centers, document imaging and other automation to the process of applying for food stamps, Medicaid and other benefits. IBM
and Indiana sued each other in state court last May.
The $5.25 million contract with Barnes & Thornburg also calls for the human services agency to pay attorneys' expenses.
Barlow said the money would come out of the agency's administrative budget, which includes legal costs.
The Barnes & Thornburg team includes longtime Republican activist Peter Rusthoven at a rate of $475 per hour, John Maley
at $465 and Brian Burdick at $405. Burdick is the brother of Betsy Burdick, Daniels' deputy chief of staff.
Signed by Brian Burdick and members of the Daniels administration in August, the contract covers Dec. 18, 2009 — a
few days after IBM's state contract ended — through June 30, 2012. The case is scheduled to go to trial next September.
"This just smells to the highest heaven," said Rep. Charlie Brown, a Democrat from Gary and chairman of the General
Assembly's Health Finance Commission.
Brown questioned the legality of a contract not signed until eight months after work began, but Barlow said it's normal
for the state to sign contracts after a vendor has started a project.
Three pages of the 9½-page contract detail Barnes & Thornburg's conflicts of interest from having represented
ACS Human Services, a division of Dallas-based Affiliated Computer Services Inc.; Arbor Education and Training; and other
subcontractors involved in the IBM deal. Arbor and ACS have new eight-year contracts with the state totaling $853.2 million.
The contract says Barnes & Thornburg attorneys, in representing the human services agency, expect to make claims against
its other clients but will not share with the state any "potentially relevant" information gained from representing
them. It said the state's case will be screened from other clients.
The state agency also should expect IBM's attorneys "will look for creative ways to exploit the fact that (the firm)
represented and continues to represent" the other clients, the contract says.
Julia Vaughn, policy director for the government watchdog group Common Cause/Indiana, said the conflicts of interest were
"handing IBM a potential hornet's nest to bat around."
"For a lot of different reasons it screams that Barnes & Thornburg isn't an appropriate firm to put in charge
of this case. It looks like their political connections overrode common sense," Vaughn said.
Barlow, the human services agency spokesman, said "any law firm that could handle a lawsuit of this size would have
conflicts."
Barnes & Thornburg spokesman Ty Gerig said the firm would not comment on the contract.
IBM spokesman Clint Roswell had no immediate comment. The company is suing the state agency for $52.8 million it claims it
is owed under the contract.
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Indiana agency paying law firm $5.25M to sue IBM
Associated Press
October 20, 2010
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liek the rest of America
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These quaint,obsessed musings by the stalkers are certainly entertaining, but I'm trying to figure out what, if anything, all the yelping below has to do with Zak Brown.
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It's evident that Moffett was pushing the right buttons and corporate America is now trying to squash him. He just wanted to withdraw the free pilot services provided to the company by the pilots to try and put some pressure on a company that has not been interested in negotiating a contract in over 5 years. The company does not provide a contract because not having one has saved them a bundle of money. Shame on any Republic pilots not standing behind their union leader just because things are getting tough, can you not see such strategic moves by the company as putting the last union president in a corporate position and into THEIR pocket. Do you really believe the last union president is so appalled at the attempts by Moffett, do you not remember his oppositions to the company? We stood behind him. It has been proven over and over again for thousands of years without fail, a man cannot serve two masters. Anyone that believes people vote contrary to their paycheck and livelihood deserve to be taken advantage of, the recent statements by the former union president are laughable as he denounces the current union president from his new corporate position. Have you ever seen a drafted sports player score points for his previous team, it cannot be done, he is not on the pilots side anymore, he gets his money a different way now than you and I do, and he should not be allowed to remain on the seniority list. A drafted player brings strength, credibility, tactical knowledge, and a strategic advantage to his NEW team, he would not be drafted or paid were it otherwise. We are all forced to choose only one side to play for and support, not doing so has many references in life such as insider trading and shaving points, all illegal for good reason. This basic fact is why corporate moguls, scientist, and engineers all sign non-discloser agreements and non-compete clauses, as protection in case they are lured into switching sides as our former union president has done. No NFL coach ever drafted a player so that both teams could benefit and better understand each other, they are recruited to win the game against that former team, period. Likewise the company does not recruit the former union president by accident or mutual understanding, its strategy. Don't confuse playing the game with good sportsman-like conduct in support of common business and prosperity goals, with the requirement to only play for one side. Good men we all love and favor fall subject to this manipulation, often without their knowledge, and it is not a betrayal of their friendship to oppose them when they switch sides. If we did not love and trust them, they would not have been chosen and lured to the other side in the first place. The deception by the drafted player is not made at a conscious level, it's just human nature and it's all about money and power which corrupts our ability to be objective and loyal to two masters. This is why our court system created the defense attorney, and why our military created counter intelligence. Its strategy and its propaganda, and it works, and that's why the "powers to be" manipulate the chess pieces by sometimes changing their colors. Some players know they are being manipulated when their color is changed, but it brings them more money and power so they do not care. The rest have good intentions but do not even realize they are being manipulated. This tactic is also known by another name, Divide and Conquer. In battle sending an imperfect message with an imperfect team is obviously not ideal, but it's still being sent by YOUR team, your union leader, a leader that has common goals and common rewards with you, they are the best, because we have elected them to do a job for us. If you are not backing Moffett but believing the spin by those that have recently switched sides, you are taking food out of your own mouth. Showing unity and backing an imperfect situation still results in taking just as much ground, it's about unity and bargaining power. It's not necessary to wait around for that perfect attack because it will never come, the company will spin and attempt to destroy anyone that gets in their way. Ultimately it's not about any specific attack anyway, ASAP or whatever it makes no difference, it is and always has been only about power. If this company cared about safety it would not build pairings with 8 hour overnights, come on, are you that naive? Besides, do you really think Hoffa cares, no, he got a call from corporate America and was squeezed into denouncing Moffett. If he didn't they would spin the safety card against him and the Teamsters National with implication for truckers, future contracts, insurance rates etc...saying something like the Teamsters use safety as a bargaining chip, blah blah blah... Do you really think any pilot is going to do something unsafe for the contract, absolutely not, the only ones threatening safety here is the company with reduced rest, fatigue, and poverty. Do you not find it odd that Hoffa and the Teamsters are opposing a Teamster president publicly? Would the Teamsters National not normally support and work with one of their own? Why did they not sit down and help him strategize, correct any mistakes, and charge ahead? Would the Teamsters National not normally support and leverage a contract for all those pilots that have been paying Teamster dues, isn't that why we have all been paying Teamster dues in the first place? I sure haven't been paying dues so that the Teamsters National could come along and write this kind of an article undercutting our union leader and our unity. Whose side is the Teamsters National really on, it's obviously not the Republic pilots side.
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No matter what Moffatt does the company is going to spin it like he is the terrorist and brainwash people like you into believing it, wake up, back your players that are trying to change things for you and your livelihood. Where has Hoffa been for the last 6 years, except collecting our dues. Seriously, do you really think an FO going for upgrade, signed off by a checkairman ready for the upgrade, who then fails, is not even capable of returning as a First Officer.
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whoa!
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Barnes & Thornburg represented ACS and several other IBM subcontractors on the FSSA welfare privatization project. Now they have signed a contract for $5.25 million to represent FSSA against IBM on the very deal B and T worked on. In the contract, they even talk about how they might on behalf of FSSA have to sue B and T's own clients, ACS, and the other subcontractors for screwing up the very privatization effort they represetned those companies on. And yet we're supposed to believe B and T will somehow keep all the inevitable conflicts separate. You think B&T is going to aggressively go after ACS on the IBM privatization deal, when B&T put the deal together and the firm wants to continue having ACS as a client? Worst conflict of interest I've ever seen.
The Disciplinary Commission should definitely be investigating the attorneys involved. The feds and the next Marion County Prosecutor also needs to be looking at what criminal laws might have been violated.
I ams so disappointed in the fact that Attorney General Greg Zoeller signed off on this contract. Surely he knew it was not in the best interest of the state and highly unethical, yet he approved the contract.
There is an old saying that "some law firms never met a conflict of interest they didn't like." While that may be true of some law firms, it should not be true of you, or this State. If B&T discovers half-way through the case that there are conflicts that cannot be waived, and then exits the case, you will need to find someone new and pay more money to educate them. Better to do that now, remove the public relations problem, and be able to proceed with a clear conscience.
Even cutting you all of the slack that I can muster, this still stinks. Get rid of the smell if you want the Republican candidates to do well in two weeks.
The Supreme Court Disciplinary Commission needs to inivestigate the attorneys involved in this conflict-ridden representation and file charges as it appears the rules have been violated. Donald Lundberg head of the Commission always looked the other way when it came to complaints filed against Barnes & Thornburg and other big firtms in town but he's no longer there...and of course is now a partner at Barnes.
This deal stinks to high heaven. Reporters need to be asking if the Governor himself approved this deal and if not, exactly who in the Governor's Office was involved. If the IURC deal required swift action, then this surely does even more. Unfortunately, the scandal might go all the way to the top.
Terry Curry just makes so much sense at this point. There's a lot of sketchy dealings going on in the Daniels Administration, and we need someone to stop this nonsense I for one will be talking to all my friends to block this candidacy. You can take a look at Massa campaign finance report and see that most of the donors are Mitch Daniels oney baggers, for sure.