Monday, November 25, 2013

HP Names Merritt Island Law Firm As Defendant In BlueWare Lawsuit

TITUSVILLE, Florida – Hewlett-Packard Financial Services Company has amended its lawsuit against the Brevard County Clerk of the Circuit Court to include a Merritt Island law firm that rendered a legal opinion for former Clerk Mitch Needelman.  The amended suit also adds BlueGem, Inc. and Rose Harr.

The lawsuit, originally filed in the summer, alleges that the Clerk’s office has failed to make monthly installment payments since November 2012 relating to a $6.1 million loan for digitizing court records.  Current clerk, Scott Ellis, has refused to make the payments.

“It looks like after many months of trying to get the point across to Hewlett Packard what happened they are finally taking the time to see for themselves how this deal went down,” Ellis said on Saturday.  “The inclusion of Rose Harr is obvious, more important I believe is the inclusion of the attorney whom the former clerk paid significant fees to legally analyze the transaction.”

According to court records filed on Friday, the amended lawsuit adds the law firm of Caruso, Swerbilow, and Camerota, P.A. and alleges “professional malpractice, negligent misrepresentation, and breach of fiduciary duty.”  Needelman had retained CSC and they had “provided a legal opinion letter verifying that the Clerk had the power and authority” to borrow funds to pay BlueGem for the scanning contract.

On Sunday, attorney Joe Teague Caruso said in an email response to Brevard Times that he had not seen the filing.  Brevard Times provided a copy of the filing via email to Caruso, but he did not respond.

HPFS has also added in its lawsuit that BlueGem and Harr “misrepresented and failed to disclose material facts to HPFS” and thus fraudulently induced Hewlett-Packard “to enter the transaction with the Clerk.”

Harr did not respond to an email request for comment.

In July, Ellis initially responded to the original lawsuit saying, “The Clerk’s Office did not approach Hewlett Packard for the loan.  BlueGem worked with Hewlett Packard to put the loan package together to get the Clerk’s Office to sign off.  Hewlett Packard provided the legal opinion to the allegedly independent attorney assessing the loan language of the note.  Hewlett Packard also arranged for a $200,000 performance bond for the BlueGem scanning contract.

“The Clerk has absolutely no equipment or software purchased with this note.  Even though BlueGem was paid nearly $7 million up front for the scanning contract, which halted months ago with the current Clerk/BlueGem litigation, they are having problems meeting their small payroll at their Melbourne office.”

Former Clerk Mitch Needelman hired BlueGem, Inc. in the summer of 2012 with an $8.5 million contract to scan court documents. Needelman changed the deal in October 2012 by borrowing $6.1 million from Hewlett-Packard and paying BlueGem in full.

The amended lawsuit was filed with the United States District Court for the Middle District of Florida.




1 comment:

  1. One has to wonder just how much more of this is going on in our Brevard County Government.

    Just look at the County Commission! They've made some very bad decisions and should be looked at closely.

    Like the cliché says, "Power corrupts and absolute power corrupts absolutely." The arrogance I've witnessed at county commission meetings by some of the commissioners is appalling. Certainly appears suspicious and gives one pause for thought.

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