Sears, CSC End Outsourcing Suit

By Evan Schuman  |  Posted 2007-10-23 Email Print this article Print


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Sears fired CSC one year into a 10-year contract. After that, the facts start to diverge.

Sears Holdings and the Computer Sciences Corp. ended a multi-year IT-outsourcing contract dispute on Oct. 22, with few details released, except perhaps the most meaningful one: Sears is paying CSC.

"Sears and CSC have amicably settled their differences on mutually satisfactory terms, with Sears paying an undisclosed amount to CSC," said the brief statement, issued just before 10 p.m. EST.

Back in May of 2004, Sears hired CSC for a $1.6 billion 10-year IT outsourcing package. Some 11 months later, shortly after the Sears and Kmart merger, Sears wanted out of the deal.

That's where the facts start to diverge. The CSC version has Sears pushing to end the contract just shy of its one-year agreement, as a "convenience" to avoid a $96 million killfee. By canceling it before the one-year mark, its early termination penalty would have only been $58 million.

Read the full story on Sears, CSC End Outsourcing Suit
Evan Schuman is the editor of's Retail industry center. He has covered retail technology issues since 1988 for Ziff-Davis, CMP Media, IDG, Penton, Lebhar-Friedman, VNU, BusinessWeek, Business 2.0 and United Press International, among others. He can be reached by e-mail at


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