Stop Press: BSkyB v EDS out at last
27 January 2010
The long awaited judgement in BSkyB v EDS was released this morning. The case revolved around the development of a new CRM system by EDS for BSkyB back in 2000. The trial, which started in 2008, was widely covered in the press at the time not just because of its scale - BSkyB sought in excess of £700m in damages - but because BSkyB alleged that reckless or intentional misrepresentation by EDS induced BSkyB to enter into the contract. Importantly, liability for this type of misrepresentation cannot be excluded or limited by contract.
Much of today's press coverage has continued to focus on that issue. They are findings that are very specific to the case however, and the judgement by Ramsey J. also deals with with important issues of recoverability of losses for breach, the effectiveness of entire agreement provisions and exclusion clauses, and the effectiveness of parallel claims in negligence running alongside breach of contract claims. These clearly have much wider implications for the IT and outsourcing industries.
In the final analysis, although EDS won a number of points, BSkyB established one instance of misrepresentation by an employee of EDS, who has since been dismissed. As a result, EDS face a damages pay out that will not be subject to the limitation of liability of £30 million in the original contract with BSkyB. Those damages could be very substantial, and will be finally determined at a later hearing. EDS, in turn, have indicated that they plan to appeal the judgement.
The judgement runs to 340 pages, and well over 2,000 paragraphs. It is available here ...
A more detailed analysis of the judgment is available here ...
For further information on this subject or any other TMT issues please contact:
Richard Cumbley 020 7456 4681 (richard.cumbley@linklaters.com)
John Crozier 020 7456 5778 (john.crozier@linklaters.com)
