Agency of Indiana, previously the partner of IBM Corporation in the past has sued IBM for almost $1.3 billion. It includes the denying of Medicaid to nun and dying patients of cancer. On the other hand IBM is asking for $52.8 million for its unresolved payments and equipment costs. The company claimed that state still has to pay for their abandoned 10 year old deal worth of almost $1.37 billion for automating the intake of food stamps, Medicaid, etc. Both parties had filed their court cases in the Marion County court of Indianapolis. According to the lawsuit filed, the Indiana Family and Social Services Administration is asking for a recovery of $437.6 million that it had paid the computer giants around 31st Jan. It also demanded for the costs for the third party cases, state employee overtime, federal penalties and much more, as a part of the deal. Under the law enforced by the state, state is looking for three types of losses whose total cost is around $1.3 billion. It blamed IBM Corporation for deliberately denying reimbursement to clients so that it can enhance its image in-front of customers for enhancing its sale.

It also blamed IBM that the company gave false and misguided information to the state agency. The state also complained about many cited cases in which IBM had hurt particular individuals by its poor work services. It explained that a dying patient of cancer was denied from the benefits of Medicaid because she had missed an interview of recertification in spite of informing the IBM guided call center that she was in hospital and so could not attempt the interview of rectification. Later on, it was due to this reason that she failed to see her food stamps. Similarly the nun wanted to reorganize the interview due to its participation at some holiday. Nun tried hard to call at least six times to the IBM call centre but they did not reply it in a well manner. Lawsuit said that nun had also sent them a fax but they did not respond to it on time. The lawsuit also said that the performance of IBM was poor from the very first day and it is very much clear from their activities that IBM had failed in obeying the terms and conditions of this agreement with state agency.

On the other hand, Clint Roswell, spokesman of IBM, stated that all the allegations of state agency are unfounded and its behavior was not good. He also stated that this project had failed due to lack of cooperation from FSSA when they refused the economic downturn in March, 2007. He also confirmed that state had ensured lots of things before starting of this project like the economic stability and many others but they could not maintain such issues. So both the parties were accused to each other for their activities and did not want to settle it.