August 23rd, 2019
After a week-long arbitration, in Arya Group vs. My Instant Guru, the Hon. Richard A. Stone (Ret.) ruled in favor of Early Sullivan client, My Instant Guru (“MIG”), in its dispute with high-end architectural firm Arya Group, which was seeking damages just south of $50 million. Scott Gizer acted as lead counsel for MIG in the arbitration.
Arya claimed that MIG, which Arya hired for networking, backup, and disaster recovery services, set up a faulty computer network and failed to maintain sufficient backups for MIG’s files. As a result, when Arya’s server crashed, Arya claims to have lost all of its data, including architectural drawings (CAD files) that would cost tens of millions of dollars to recreate. Arya alleged five claims against MIG: (1) a breach of contract claim based on MIG’s alleged failure to maintain backups; (2) a negligence claim based on MIG’s purported duty; (3) breach of fiduciary duty; (4) negligent misrepresentation; and (5) fraud.
MIG argued that it fully performed as required and that the server crash and loss of data occurred because Arya failed to heed MIG’s warnings and follow MIG’s advice. Based upon the testimony of the parties and witnesses, the documentary evidence and the arguments of counsel, the Arbitrator ruled in favor of MIG regarding Arya’s claims against it. “Arya failed to heed MIG’s explicit and repeated advice regarding the server upgrade,” the ruling reads. The arbitrator found “there were simply too many opportunities for Ayra to protect itself, or allow MIG to protect it, to permit a finding for Arya in this matter.”