NEC Australia Takes Gov’t to Court to Recover Costs from Cancelled Biometric Project

NEC Australia is taking the Australian government to court for the unexpected termination of a Biometric Identification Services (BIS) contract. The contract in question was first signed in 2016, when Australia’s CrimTrac (now the Australian Criminal Intelligence Commission) enlisted NEC Australia to upgrade the biometric capabilities of Australia’s state, federal, and territorial police.

The BIS project would take Australian law enforcement from a fingerprint-only system to a full multi-modal portfolio with facial recognition and fusion technology. However, the ACIC unceremoniously cancelled the contract “for convenience” in June of 2018. NEC Australia has consequently initiated legal proceedings in the Supreme Court of Victoria in an effort to recover costs associated with the project that were lost as a direct result of the late stage cancellation. The “for convenience” distinction is noteworthy because it indicates that NEC Australia was not in breach of its contract. That finding has since been reiterated in separate reports from the Australian National Audit Office and The Federal Government’s Joint Parliamentary Committee on Law Enforcement, neither of which found any wrongdoing in NEC Australia’s management of the project, a conclusion seemingly at odds with the delays the ACIC cited when cancelling the project. The ANAO report, in particular, emphasized that “the subsequent administration of the BIS project by CrimTrac and ACIC was deficient in almost every significant respect.”

NEC Australia is not seeking any damages, and is instead only looking to recover the funds it had already invested in the project. The company would not disclose any of the financial specifics of its claim, although the ACIC indicated that the BIS project was $40 million over budget when it was cancelled.

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July 22, 2019 – by Eric Weiss