Lawsuit claims Epicor's two-year effort delivered 'useless' software

IDG News Service - Beverage distributor Major Brands is suing Epicor, alleging the ERP (enterprise resource planning) software vendor failed to deliver a satisfactory system after years of effort and significant cost overruns, and then offered a solution that would force the company to install a new version that hadn't yet been completed, pushing back the original "go-live" date by four years.

In September 2008, Major Brands began looking for a new software suite to replace some 20-year-old applications it had been using to run its business, according to the company's complaint, which was filed Thursday in U.S. District Court for the Eastern District of Missouri.

The older software was still "functioning in an acceptable fashion," but the St. Louis company decided that a third-party package supported by a vendor would be preferable to its existing system, which it was supporting on its own, the complaint states.

Major Brands ended up signing contracts with Epicor in September 2009. Before doing so, the company gave Epicor a detailed accounting of its business processes and transaction volumes, according to the complaint. The company also allowed Epicor personnel to "visually observe all aspects of its order entry process [so] it would understand Major Brands' needs and requirements and the processed involved."

Epicor assured Major Brands that its V9 software was up to the task, and would also be usable with the company's current hardware, with no need for a "substantial" upgrade, the complaint states.

The vendor also told Major Brands that the applications would be fully installed and running in production form by mid-2011, it adds.

In addition, Epicor served as the systems integrator on the project, and characterized the fact that Major Brands would have "one throat to choke" as a significant advantage, the complaint states.

Major Brands paid Epicor an initial fee of about US$500,000 for software license and support, and roughly $670,000 for implementation services.

The software was installed on Major Brands' hardware in November 2009, but "problems with operations, implementations and training" began almost at once, the complaint states. Epicor's application was "running so slowly that it was not going to be suitable for use," it adds.

Epicor told Major Brands that a hardware upgrade would help the performance, so the company spent about $100,000 on new machines, according to the complaint.

Meanwhile, the majority of training on the new software was supposed to be completed by April 2010, but the schedule ultimately had to be dropped due to delays in finishing "certain modifications and integrations promised in the project plan," the complaint adds.

As the year went on, Epicor told Major Brands that the project remained on track for the original "go-live" date, the complaint states. But a simulation test scheduled for July 2010 slipped to November of that year.