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.
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.
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.”
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.
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.
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
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.
lawsuit was filed with the United States District Court for the Middle District