LOS ANGELES (CN) - A charitable foundation claims in court that a telecom firm's "gross failure" to process donations from a Hurricane Sandy benefit concert in Madison Square Garden cost storm victims $5 million.
Robin Hood Foundation sued Patriot Communications in Superior Court.
The Robin Hood Foundation was one of the organizers of 12-12-12: The Concert for Sandy Relief. Patriot provided Internet and telephone fund-raising services for the event, the foundation claims in its lawsuit.
The New York-based foundation alleges breach of contract, breach of warranty, negligence and fraud.
Robin Hood claims that at first it wanted to hire Patriot only for its call center services, but Patriot landed a $1.4 million contract to handle all contributions by falsely claiming that its rivals, including Google and Amazon, would not be able to cope with the high volume of Internet donations.
The concert, featuring Bruce Springsteen, Paul McCartney and the Rolling Stones, among others, raised more than $50 million but would have raised more were it not for Patriot's "gross failure to perform the core services," the foundation claims in the lawsuit.
During the peak hour of roughly 10 p.m. to 11 p.m., Patriot's donation website ground to a complete halt, according to the complaint.
"Patriot processed less than $15,000 in Internet donations, despite the fact that it had processed approximately $2 million in the hour that preceded the blackout," the complaint states.
Patriot's processing platform was plagued by glitches throughout the night, the foundation claims, driving away people who may have otherwise donated.
With long wait times and dropped calls, Patriot's call center failed to "mitigate the effects of Patriot's Internet blackout," the foundation says.
"In short, to get this lucrative contract, Patriot promised Robin Hood it could withstand any heat from expected donor volume, only to then melt down when it came time to perform," the complaint states.
Adding insult to injury, Robin Hood claims, Patriot invoiced it for an unpaid balance of $410,893.60 after the concert.
"Patriot compounded its misdeeds in the months following the 12-12-12 event by refusing to provide Robin Hood with critical data needed to assess Patriot's performance, notwithstanding Robin Hood's contractual 'right to audit' Patriot's records for the purpose 'verifying compliance with the terms and conditions of this agreement,'" the complaint states.
The foundation demands $5 million for the storm victims.
"Robin Hood seeks to hold Patriot accountable for the millions of dollars in donations that were lost to Hurricane Sandy victims as a result of its misconduct," the complaint states.
The Robin Hood Foundation is represented by James Fogelman with Gibson, Dunn & Crutcher.
Superstorm Sandy devastated coastal New York and New Jersey in late October 2012, at just under hurricane strength. With U.S. damages estimated at more than $65 billion, it was the second-costliest hurricane in U.S. history.
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