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Munetrix Sues Socrata for Allegedly 'Screwing' it Out of Michigan Contract

Munetrix alleges in a lawsuit that Socrata went back on an agreement to work together to build a data system in Michigan.

Socrata is facing a lawsuit in Michigan after the open data company allegedly under-bid its own partner on a response to a state contract worth $2.5 million.

Munetrix, a government data and analytics firm, filed a complaint July 19 in Oakland County Circuit Court alleging that Socrata went back on a 2015 agreement to partner on a joint bid to develop a financial data dashboard for local governments and schools across the state. According to Munetrix’s complaint, Socrata and Munetrix entered into an agreement that explicitly stated neither party could submit independently for the bid — Socrata did so anyway.

According to the document, Tyler Masterson, Socrata’s eastern region director and Munetrix’s point of contact on the Michigan project, didn’t let on that the company was bidding separately until very late in the process.

“Masterson repeatedly orally affirmed to [Munitrix Co-Founder Bob] Kittle [that] Socrata’s intention to work exclusively with, and not compete against, Munetrix on the Michigan RFP,” the complaint states. “Munetrix relied on those affirmations in preparing to submit a joint response to the Michigan RFP.”

Further, according to the court document, Socrata’s team on the project actually took information they learned from the partnership and used it to make their bid more attractive. Specifically, they undercut the price of the joint bid.

The complaint also alleges that in a job interview with open data and budgeting company OpenGov, Masterson told that company’s chief executive officer that he had “screwed” Munetrix out of winning in Michigan. Munetrix’s bid was one of three finalists, and the company believes it would have won if not for the Socrata bid.

In the end, Socrata won the Michigan contract, though the complaint says that Socrata has since submitted requests to the state of Michigan to change the price. Contract documents on the state website show that the original contract was worth $50,000 up front, or $103,964 if the state decided to buy additional items. But the contract has changed six times; each time new features and users are added, and the life of the system is extended past the initial one-year term. After those changes, the contract’s value is $2.5 million.

Socrata representatives declined to answer questions, provide comment or refer Government Technology to an attorney with knowledge of the case for this story.

It’s unclear that Socrata ever officially signed the teaming agreement that laid out the terms of its partnership with Munetrix — according to the complaint, Munetrix sent the agreement to Socrata but can’t find a signed version of it.

“Probably the most accurate thing I can say is we don’t have a copy …we might be able to find in discovery a signed copy, but we were unable to locate [it],” said Roger Meyers, a Michigan attorney representing Munetrix in the case.

Regardless, Meyers said, Socrata entered into verbal agreement with Munetrix to submit for the bid together. Courts generally enforce non-written agreements similarly to contracts.

Meyers said Munetrix doesn’t blame any Michigan officials for the turn of events.

“This lawsuit is not in anyway a criticism of the state of Michigan,” he said. “This is a criticism of the way Socrata chose to do business.”

Ben Miller is the associate editor of data and business for Government Technology. His reporting experience includes breaking news, business, community features and technical subjects. He holds a Bachelor’s degree in journalism from the Reynolds School of Journalism at the University of Nevada, Reno, and lives in Sacramento, Calif.