CEBU CITY — A retail warehouse club chain here has sued Microsoft Corp. for fraud and gross negligence over an alleged bug in its point of sale solution that had caused pricing errors.
Prince Warehouse Club, Inc. sued the software giant before a Cebu regional trial court last week and sought P10 million in damages and legal expenses.
Also charged were Microsoft Operations PTE Ltd., Microsoft Philippines, Inc. and Microsoft business partners Global Implementation Services, Inc. (GIS), Eastwind Retail Management Solutions, Inc. and Eastwind Enterprise Systems Philippines, Inc. Eastwind has taken over the operations of GIS, which had sold the solution to Prince Warehouse Club.
Robert Go, chief executive officer of Prince Warehouse, said he was merely trying to recover losses caused by the allegedly defective Retail Management System version 1.3.1002 in one branch.
"It was chaotic. Suddenly, [our] prices became lower than the programmed price. When we looked at our cash register, we found that some items were even priced zero. We lost a lot of money," he said. A bottle of iced tea that normally went for P13.25 was erroneously priced P4.001.
Mae Rivera-Moreno, Microsoft public relations manager, said in an e-mail that they had not received a copy of the complaint.
Microsoft Dynamics Retail Management System automates point-of-sale processes and store operations, provides centralized control for retailers with more than one branch, and integrates with Microsoft Office programs and other applications.
Mr. Go said Microsoft officials were aware of the problem since he had complained to the software company in March 2007.
Deolito L. Alvarez, Prince Warehouse lawyer, said they had written Microsoft’s Philippine and Singapore units and the reseller in February to tell them that Prince Warehouse was rescinding the software purchase deal and would seek to recover the losses.
He said the software had failed to deliver on its promises and had in fact caused losses to the company.
In its suit, Prince Warehouse claimed it had lost P1.51 million as a result of the erroneous pricing caused by the defective software. It also claimed to have lost P5.82 million in business opportunities.
"Our customers lost trust in us because the system was unreliable," Mr. Go said.
The company also intends to get back P2.1 million representing the purchase price of the software and hardware, as well as the implementation costs, including travel and accommodation expenses.
The company also asked the court to order the defendants to pay P900,000 in compensatory and exemplary damages, lawyers’ fees, and litigation expenses.
Cebu retailer sues Microsoft for ‘defective’ retail software
Posting Permissions
