Mayor Lee Signs Office Depot Overcharge Settlement
$4.25 Million Settlement Resolves Office Depot Overcharge Dispute Discovered by City Controller’s Audit
03/08/11—Mayor Edwin M. Lee today signed a Board of Supervisors’ resolution that authorizes a settlement agreement between the City and County of San Francisco and Office Depot, resolving the dispute for overcharges with the City’s contract for office supplies. The City Attorney negotiated the $4.25 million settlement, which includes a $3.75 million payment and a $500,000 purchasing credit with Office Depot.
“I am pleased that this matter is behind us, and thank Office Depot for settling this overcharge dispute without costly litigation,” said Mayor Lee. “Because of the hard work and diligence of our Office of Contract Administration, the Controller, the City Attorney, and the Board of Supervisors, San Francisco is making sure that our taxpayer dollars are spent appropriately.”
“This is a favorable settlement that avoids the costs and risks of litigation,” said City Attorney Dennis Herrera. “Our ability to drive a hard bargain on behalf of San Francisco taxpayers owes much to the excellent work of City Controller Ben Rosenfield and his staff, and I’m very grateful to them for the comprehensive audit they performed last year. I also appreciate the efforts of Office Depot to work with us, cooperatively and diligently, to resolve this dispute.”
From January 26, 2005 through November 30, 2009, Office Depot was the City’s contractor for office supplies. In 2009, the Office of Contract Administration initiated an audit by the City Controller and found that the company failed to provide San Francisco with an estimated $5.75 million in contractually mandated discounts for items covered in its five-year, $18 million contract. The City Attorney initiated the City’s claim in a demand letter to the Boca Raton, Florida-based company a year ago. Office Depot disputed the claim, initially maintaining that overcharges totaling less than $50,000 were the result of accounting errors. The Office of Contract Administration, the Controller and the City Attorney took appropriate action until an appropriate settlement was reached.
03/08/11—Mayor Edwin M. Lee today signed a Board of Supervisors’ resolution that authorizes a settlement agreement between the City and County of San Francisco and Office Depot, resolving the dispute for overcharges with the City’s contract for office supplies. The City Attorney negotiated the $4.25 million settlement, which includes a $3.75 million payment and a $500,000 purchasing credit with Office Depot.
“I am pleased that this matter is behind us, and thank Office Depot for settling this overcharge dispute without costly litigation,” said Mayor Lee. “Because of the hard work and diligence of our Office of Contract Administration, the Controller, the City Attorney, and the Board of Supervisors, San Francisco is making sure that our taxpayer dollars are spent appropriately.”
“This is a favorable settlement that avoids the costs and risks of litigation,” said City Attorney Dennis Herrera. “Our ability to drive a hard bargain on behalf of San Francisco taxpayers owes much to the excellent work of City Controller Ben Rosenfield and his staff, and I’m very grateful to them for the comprehensive audit they performed last year. I also appreciate the efforts of Office Depot to work with us, cooperatively and diligently, to resolve this dispute.”
From January 26, 2005 through November 30, 2009, Office Depot was the City’s contractor for office supplies. In 2009, the Office of Contract Administration initiated an audit by the City Controller and found that the company failed to provide San Francisco with an estimated $5.75 million in contractually mandated discounts for items covered in its five-year, $18 million contract. The City Attorney initiated the City’s claim in a demand letter to the Boca Raton, Florida-based company a year ago. Office Depot disputed the claim, initially maintaining that overcharges totaling less than $50,000 were the result of accounting errors. The Office of Contract Administration, the Controller and the City Attorney took appropriate action until an appropriate settlement was reached.