Riley calls lawsuit wasteful, political and frivolous
The lawsuit, brought by the legislative contract review committee, did not seek damages, but sought to stop the multi-million-dollar contract with Paragon Source LLC.
"We said from the beginning this lawsuit was frivolous and a waste of taxpayer money," Riley said in a statement. "Today, the judge confirmed just that. It's over. Now it's time for the Democrats to stop playing politics and quit wasting everyone's time and money."
Democrats have repeatedly voiced their concerns over Paragon, which was awarded a no-bid contract that could pay as much as $13 million over five years. They said they had concerns about giving such a large contract to a company with no Web site, no listed phone number and that listed its headquarters as personal residences.
State Rep. Alvin Holmes, chairman of the contract review committee, said he was very disappointed in the ruling, but said it was not based on the merits of the case. He said the judge ruled that the committee did not have legal standing to file the case.
"We're going to continue to pursue this. This issue is not going away," said Holmes, D-Montgomery. "The committee still has subpoena power."
Circuit Judge Tom King ruled that the committee did not have legal standing to sue; that members did not prove the actions damaged them or their official duties; that the lawsuit was moot because the committee had no jurisdiction after the contract was executed; and that the lawsuit raised political questions that were not appropriate for the court to decide.
"The court finds that neither the committee nor its individual members, such as Chairman Holmes, have standing in their official capacities to sue to declare void a state professional services contract that the committee has reviewed, commented on, and discharged," the judge wrote in his order.
Holmes said options include appealing the ruling or refiling the lawsuit with a different plaintiff. The legislator said they are in the process of trying to find an individual to be the plaintiff.
He said there were also a handful of companies who were willing to testify in the case that they could have performed the work.
Holmes and the attorney for the committee, Tyrone Means, argued that Paragon never should have received a "sole source" contract because other companies could perform the work. He said they would discuss the situation with those companies and see if they are willing to be plaintiffs.
Riley and Acting Finance Director Bill Newton have said no one has questioned the company's work and have said Paragon received the sole-source contract because personnel with the company have worked with the Alabama system since its inception. Paragon officials are mapping out a plan to help revamp the state's computer system that is used for financial functions such as payroll and purchasing.
Riley's office contended the lawsuit could cost as much as $300,000 in legal fees while Paragon's work could save $4 million to $6 million a year if implemented.
"The state played by the rules. Paragon is performing important and complex work for the state," Newton said in a statement. "With their valuable help, we will make state government more efficient and save the taxpayers millions of dollars each year."
The committee filed the lawsuit against Riley, Newton and top officials with Paragon.
Holmes said the Alabama constitution provides for a separation of powers and a system of checks and balances between the branches of government.
"The legislative branch has a right to check on the executive branch and how they're spending money," he said.
People should know, he said, what the executive branch is doing with the money and who is receiving it.
Trying to void the contract after it was executed raises concerns about separation of powers, King wrote.
The two sides debated the dismissal during a Dec. 17 court hearing.