J.D. Edwards user wins arbitration case against ERP vendor

Doskocil Manufacturing Co., an Arlington, Texas-based maker of pet products and sporting goods, won its damages case against J.D. Edwards & Co. by convincing a panel of arbitrators that the version of the vendor's OneWorld software it tried to install in 1998 didn't work properly.

In documents dated last July, a committee from the New York-based American Arbitration Association said it had decided that the enterprise resource planning (ERP) software J.D. Edwards delivered to Doskocil was "a defective product" and that the technology was "unstable and immature." The arbitrators awarded Doskocil $2.3 million in damages.

The company had requested arbitration proceedings in November 2000 in hopes of recovering up to $25 million from J.D. Edwards. Vincent Hess, an attorney in the Dallas office of Locke, Liddell & Sapp LLP who represents Doskocil, declined to comment about the decision this week. But he said, "I think the award speaks for itself."

A spokesman for Denver-based J.D. Edwards said Doskocil's project "involved a highly complex relationship" involving the user, J.D. Edwards, Microsoft Corp. and Chicago-based Grant Thornton LLP, which did software implementation work for Doskocil as part of the project.

In a statement, J.D. Edwards said Doskocil's problems stemmed from delays in processing sales orders due to the locking of a Microsoft SQL Server 6.5 database, which became more severe as the number of end users increased. "The operative issue was not the functionality of J.D. Edwards' software," the vendor said. "Rather, it was the way in which J.D. Edwards' software performed when used with the Microsoft database."

J.D. Edwards added that the database-locking problem was completely resolved when Microsoft released SQL Server 7.0 in late 1998.

The arbitrators cited the SQL Server issue as part of their decision in favor of Doskocil. But they also said the OneWorld manufacturing module and middleware that J.D. Edwards built into the application suite were defective.

Copyright © 2003 IDG Communications, Inc.

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