AUGUSTA — The state will collect $410,000 from its longtime computer supplier over the next 12 months to settle a lawsuit that claimed the vendor made excessive profits.

The Department of Administrative and Financial Services sued Managed Technology Partners, formerly known as CBE Holdings of Massachusetts, and an affiliate, CBE Technologies, formerly known as CBE/ValCom of South Portland, claiming they had collected excessive profits on state contracts from 2004 to 2008.

A notice ending the lawsuit was filed Friday in Kennebec County Superior Court.

According to the complaint filed by Assistant Attorney General William Laubenstein III, CBE won a state contract in May 2004 in which it agreed to charge no more than 5.75 percent above vendor invoice pricing for standard desktop computer systems.

The computers and related items were purchased by state agencies, municipalities, political subdivisions and school districts. The contract and yearly extensions ran from June 1, 2004, to Feb. 28, 2007.

The lawsuit, filed last Sept. 15, was triggered by an audit of the contract in 2009 by the state Office of Information Technology.

When CBE provided manufacturers’ invoices for items purchased, the state’s auditor “determined that CBE/Valcom’s percentage markup of the manufacturers’ invoice prices was greater than 5.75 percent,” according to the complaint.

The state sought the return of all money in excess of the contract price from July 1, 2004, to Dec. 2, 2008, plus interest and attorneys’ fees.

Neither dollar figures nor the contracts were provided in the lawsuit. However, public accounting records available through maineopengov.org show the state paid CBE $11 million from 2006 to 2009. The site does not show the amounts paid to CBE from 2004 to 2005.

CBE Technologies announced the settlement Monday.

“CBE’s current contract with the State of Maine and its business practices under new ownership since April 2008 were not questioned in this dispute,” said CBE President and Chief Executive Officer George Mellor in a prepared statement.

The state continues to honor its contract and buy computers from CBE.

On Monday, Laubenstein said, “We had a dispute, and we resolved our differences.”

Under the settlement agreement, the money is to come in three payments, with the first payment of $110,000 to be paid by Saturday.

Payments of $150,000 are to follow on June 15 and Dec. 15. The agreement calls for 80 percent of the money to come from Maine Technology Partners and 20 percent from CBE.

CBE Technologies has its headquarters in Providence, R.I., and has sales and service offices in Portland and other New England locations.

 

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