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Brevard Clerk files lawsuit against company brought to Fla. with economic incentives

A company that was hailed by Enterprise Florida and Gov. Rick Scott when it decided to move to Florida last year has wasted no time getting into legal trouble. 

The company, BlueWare Inc., is being sued by the Brevard County Clerk of Court after a $8.6 million contract has gone sour. 

The company is supposed to digitize millions of pages of records for the clerk’s office under a five-year, $8.6 million contract. But recently elected Clerk of Court Scott Ellis slammed the contract as corrupt and filed a lawsuit last week to recoup millions of dollars. 

“The entire bidding, selection and negotiation process regarding the (Invitation to Negotiate) was fundamentally flawed and against public policy because BlueGEM was intricately involved in the preparation of the ITN itself and essentially drafted the same,” the lawsuit reads. 

Ellis put it more plainly in a recent interview: “It was a sham bid.” 

Ellis blames his predecessor, who lost a 2012 primary race for reelection, for entering into the poorly written contract and paying BlueWare millions of dollars upfront before the work could be done. 

Ellis said BlueWare’s vice president was a former business partner with the clerk. 

Indeed, a flag-raising 2012 internal memo from the clerk’s legal counsel stated: “There may be a civilian insider who will gain a benefit from the awarding of this contract.” 

According to the lawsuit, two other companies submitted bids for the digitization contract and would have charged less. BlueWare executives were allowed to participate in the selection process and the company was ultimately selected, the lawsuit states. 

Executives at BlueWare could not be immediately reached for comment. 

The company received incentives awards from the state worth $1.3 million, including a $560,000 cash grant for start-up costs.

It’s yet another example of an economic incentives project that has led to problems, causing many lawmakers to question if paying companies money to come to Florida is good public policy. Companies like Digital Domain, Banah International and Redpine have all gone bust after getting economic incentives from taxpayers. 

Scott hailed BlueWare for relocating from Michigan to Florida last year, saying the company would create 190 high-paying jobs in Melbourne. 

“BlueWare’s choice to move to Florida is a testament to the strength of our business climate and the result of a common vision for economic growth by local, regional, business and government partners,” he said in a statement. “Today’s announcement is a great win for the Space Coast, as well as for the entire state.” 

The company has not yet received any payments from its $1.3 million award from the state, according to records at the Department of Economic Opportunity.

The company received a contract worth $760,000 to help train workers last year, but has only used $1,224, according to the Brevard Times. The Brevard Workforce, which entered the contract, could not immediately provide information about the contract or job creation at BlueWare.

Ellis said the company has not reached its job creation goals and is far behind on digitizing the clerk’s records. 

BlueWare received more than $6 million upfront for the five-year project, through a loan agreement between the Clerk of Court and Hewlett Packard last year. After becoming clerk in January, Ellis decided to stop making the payments to Hewlett Packard and filed suit against BlueWare to try and void the contract signed by his predecessor.

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