Pennsylvania govt sues IBM over USD 170 million of unemployment claims

Pennsylvania Gov. Tom Wolf's administration has sued IBM, saying the company failed to deliver on a 2006 contract to build an integrated system to process unemployment claims.

The lawsuit, filed, says the computer company was paid USD 170 million, but delivered a failed project when the state let the contract expire in 2013. The suit says the project was nearly four years behind schedule and USD 60 million over budget.

The state accuses IBM of breach of contract, and seeks undisclosed damages. A telephone message left with Armonk, New York-based IBM wasn't immediately returned.

The suit comes amid a fight between the Democratic governor and Republican senators over how the unemployment compensation system is run and funded. It was filed in Dauphin County by a private law firm representing Pennsylvania.