A US agricultural co-operative has filed a $20 million lawsuit against Oracle, alleging fraud, negligent misrepresentation, malpractice and breach of contract.

California based TriValley Growers (TVG), which processes and markets its members' fruit and vegetables, claims that the database giant failed to fulfil its contract to modernise the company's
production and management systems using its enterprise resource planning (ERP) applications.

Jeffrey Shaw, TVG's president and chief executive, said: "I have never sued anyone in my life, and we certainly wanted to avoid litigation, but Oracle's refusal to be reasonable with our request
after all of its promises and commitments left us no choice."

The $800 million company hired Oracle in November 1996 to computerise and integrate its operations that span from raw product delivery to finished goods distribution.

But according to the lawsuit, Oracle's consumer packaged goods (CPG) application never worked and could not even be installed on TVG's computers. The suit also claims, however, that Oracle blamed the failure on TVG's computers and the company's lack of technical expertise.

Shaw continued: "We trusted Oracle was selling a commercial product that worked. As we found out, not only did the product not work for us, but also a working ERP package did not even exist at the time it sold the product to us. I am completely baffled that Oracle thinks it can get away with this."

According to TVG, Oracle had indicated that it had sold similar software to other packaged goods companies and would license, install and support the software.

Oracle refused to comment on the lawsuit, but Rob Enderle, an analyst with Giga Information Group, said: "The TriValley Growers look at a vendor like Oracle and rely on it to execute and deliver. When it was unable to execute, the growers felt let down. Oracle, by the nature of the fact of wrong assumption, didn't execute."

He added that in this case, Oracle could well be held accountable. "Oracle may not have known the kind of beast it was taking on," he said.

TVG intended to use the software at its nine factories, which employ more than 9,500 workers, to process more than one million tons of fruit and vegetables annually. The company, founded in 1932, distributes products domestically and internationally.

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