EDS takes legal action on Oyster card contract

In another twist to the London Oyster card tale, EDS, a member of the consortium that runs London Oyster card system, has restrained Transport for London from handing over the £100m per year contract to the other major consortium partner Cubic.

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In another twist to the London Oyster card tale, EDS, a member of the consortium that runs London Oyster card system, has restrained Transport for London from handing over the £100m per year contract to the other major consortium partner Cubic.

EDS and Cubic are both principal partners in TranSys, the consortium that runs London's Oyster travel card system. Both partners own 37.5 percent of the consortium, where Cubic designs, manufactures, installs and maintain assets, such as Oyster readers, while EDS provides IT operational services.

Last week, the TfL announced it was to terminate its contract with TranSys as part of a cost cutting measure. A TfL spokesperson also told Computerworld UK the transport authority wants to recoup more than a £1 million in losses from TranSys, the result of a series of outages of the system in July .

But a Securities and Exchange Commission (SEC) report, filed on Friday in the US, revealed that EDS has issued a restraining order on Transport Trading Limited (TTL), a subsidiary of Transport for London (TfL), to prevent it handing over the London Oyster card contract to Cubic.

The filing revealed that back in 2007 the transport authority entered negotiations with both suppliers in a bid to restructure the TranSys contract to "obtain better terms". Following one year of talks, TTL had made "satisfactory progress" with Cubic, but negotiations with EDS had failed.

Following the decision to end the TranSys agreement, announced in 2008, TTL conducted separate negotiations with EDS and Cubic.

"Negotiations with EDS failed again," the filing said. TTL then brokered a deal to hand over the entire project contract - including maintaining assets and IT services - to Cubic. The new contract, called the Future Ticketing Agreement, has been prepared.

But EDS filed a temporary restraining order to prevent TTL from from signing the contract.

TfL said in a prepared statement: "EDS, one of the partners of the TranSys consortium, has sought to challenge the procurement arrangements for the new contract. Transport for London are vigorously defending this challenge and have appealed against the interim court order. We remain committed to delivering better value for money and to ensuring a seamless transition to any new contract from 2010."

TfL also noted that it expects "any new arrangements will save millions of pounds, savings that will be invested in further improvements to the capital's transport network."

Cubic said in the SEC report that TTL would have this restraining order lifted by the end of the year.

 
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