Appeals Court Lessens Breach of Contract Damages Paid to Transverse, Rules IWS Violated NDA

Iowa Wireless Services (IWS) will still have to pay breach of contract damages to telecom billing software provider Transverse, but potentially far less than the $11.7 million initially awarded by a Western Texas U.S. District Court, the 5th U.S. Circuit Court of Appeals ruled in June. A revised opinion was filed in the docket Wednesday. After 5th Circuit Judges Jennifer Elrod and Eugene Davis ruled IWS breached a service contract and nondisclosure agreement, the court denied the petitions for rehearing from both parties Wednesday. Transverse had been tasked to build out a billing system for IWS, but after delays in the development process IWS began to seek another provider and breached the existing supply contract in the process, the appeals court opinion said. The district court had originally found IWS didn't breach a nondisclosure agreement with Transverse after giving a competing contractor documents and draft agreements from meetings with Transverse -- a decision reversed by the 5th Circuit. The appeals court also said the district court had allotted more money in damages for the supply contract breach to Transverse than it would have made before the contract termination, and remanded the issue back to the district court to determine the restructured amount. IWS and Transverse had no comment by Friday.