IBM and Genesys end PACS dispute

November 3, 1993

Genesys has reached an out-of-court settlement in its lawsuitagainst IBM relating to work on a picture archiving and communicationssystem installation at a Florida hospital. Genesys had chargedIBM with breach of contract and attempted theft of trade

Genesys has reached an out-of-court settlement in its lawsuitagainst IBM relating to work on a picture archiving and communicationssystem installation at a Florida hospital. Genesys had chargedIBM with breach of contract and attempted theft of trade secretsafter the computer giant tried to gain access to source codesin Genesys software at Jackson Memorial Hospital in Miami (SCAN10/20/93).

IBM terminated Genesys' contract at Jackson Memorial Sept.9 and tried to acquire Genesys source codes held in escrow bya third company. Genesys filed for a temporary injunction in statecircuit court in Orlando, FL, to prevent IBM's move. Genesys alsoalleged that IBM owed the company $31,000 for work at JacksonMemorial and asked for attorney's fees and damages in excess of$15,000.

A hearing on the lawsuit was scheduled for Oct. 20 but wascanceled when it became apparent that the two sides were closeto settling.

According to the terms of the agreement, IBM will not gainaccess to the source codes, said Genesys president Robert A. Watson.

The agreement included a $9000 payment from Genesys to IBMto settle accounts between the companies, according to Genesys'attorney Timothy Schulte of Zimmerman, Shuffield, Kiser &Sutcliffe in Orlando.

Genesys claimed in legal documents that IBM owed it $31,000,while Genesys in turn owed IBM $40,000 relating to work on JacksonMemorial, Schulte said.

While the deal ends litigation between the parties, the statusof Genesys as a subcontractor on the Jackson Memorial installationis in doubt. Genesys remains terminated from the job, and discussionsabout bringing Genesys back on board the project have been shelvedfor the time being, according to Watson.

Jackson Memorial's PACS is shut down and Genesys must go throughIBM to gain access to the site, Watson said.

"It's clearly a great disappointment for us," Watsonsaid. "We feel we were close to completing the requirementsand look forward to getting the opportunity to do that at somepoint."