Open International submitted a proposal to Fort Collins in March 2018 claiming 89.7% of required software features were ready — and possessed an internal document from that same month showing the real number was 59.4%, a gap the company never disclosed to the city it was trying to win a contract from.

Open International’s $20 Million Lie to the People of Fort Collins

A Florida Tech Company Sold a Public Utility a Product It Knew Didn’t Work

Fort Collins, Colorado is not a corporation. It is a city of real people who pay utility bills, depend on functional broadband infrastructure, and trust that when their government spends public money on a technology contract, the vendor on the other side of the table is being honest. Open International, LLC — a Florida limited liability company — exploited that trust.

The company submitted a fraudulent capability assessment, won a major municipal contract, collected payments for years while the project fell apart, and then tried every legal maneuver available to avoid accountability. A jury saw through it. A federal judge backed the jury up. And on July 23, 2025, a three-judge federal appeals panel affirmed it all.

The judgment: just under $20 million ($20,000,000 — enough to give every household in Fort Collins a direct check of roughly $170, or to fully fund a mid-size city’s public library system for five years).

How You Lie to a City in a Spreadsheet

In February 2018, Fort Collins published a formal request for proposal — a document that told every bidder exactly what the city needed from its new utility billing software, including a new broadband service called Connexion. The RFP included a “functional matrix,” a detailed checklist of every capability the software had to have. Vendors were specifically directed to fill it out “accurately and factually.”

Open International responded on March 12, 2018. The company graded 89.7% of required functionalities as “A” — meaning those features were already built into the base system and required no modification. The city selected Open International based heavily on that assessment.

What the city did not know: Open International possessed its own internal evaluation, dated the same month, March 2018, that assessed only 59.4% of functionalities as currently existing. The company never showed the city that document. The city only found it during litigation discovery — years after signing the contract.

The Gap Between the Pitch and the Product

There is a 30.3 percentage point gap between what Open told Fort Collins (89.7% ready) and what Open’s own internal team had calculated (59.4% ready). That is not a rounding error. That is the difference between a product that mostly works and a product that is fundamentally incomplete.

To make the deception worse, the court record shows that Open International graded its own homegrown software in the functional matrix — then proceeded to deploy a completely different third-party portal called “Milestone” for the actual contract. Open International’s own president admitted at trial that “no one at Open told the City that Open did not grade the Milestone portal in the RFP response.”

The Non-Financial Ledger: What Money Can’t Repay

The City Staff Who Spent Years Chasing a Ghost

Think about what it means to work for a city utility department and spend years troubleshooting software that was broken before the contract was ever signed. The court record documents that the project “suffered problems from the beginning” when it kicked off in late 2018. By August 2019, the customer self-service portal was live — and immediately had “critical functionality missing.” City staff began logging “extensive” testing hours on a portal that had been delivered differently from what was demonstrated during the sales process.

These were not abstract technical failures. The portal was for Fort Collins’s broadband utility, Connexion — a service real residents depended on for internet access. Every billing error, every customer who could not manage their account online, every support call that should have been a self-service transaction represented a failure that landed on city workers and residents, not on the Florida company that sold the broken product. The people doing the work on the ground had no reason to suspect they were starting from a fraudulent foundation.

By November 2019, the city formally cited the portal as a “primary concern,” documenting that the version that got deployed was “different than what got delivered.” Staff hours, city resources, and public trust were all pouring into a project that Open International’s own internal records — records the company hid — showed was never built to do what was promised.

The Gradual Horror of Realizing You Were Swindled

The city’s Chief Financial Officer testified under oath about the moment the full picture became clear. The CFO described realizing Open’s misrepresentations as “a gradual process.” The functional matrix audit in spring 2021 — where the city and Open jointly reviewed whether the software was actually performing as advertised — was the moment the CFO said, in his own words: “I think we may have gotten swindled.”

That phrase, spoken by a senior public official under oath in a federal courtroom, carries enormous weight. This was not a situation where city employees were naive or negligent. The record shows the city hired an external project manager who filed written concerns but still recommended staying with Open International. The city hired a third-party consultant in 2021 who also initially recommended continuing the project. “Completing the project with Open International remained ‘Plan A’ for the City” — right up until the joint audit exposed the truth.

The reason the city kept trying is the reason the fraud was so effective: the company’s deception was structured to look like normal project difficulty. Delays happen in software projects. Portals need configuration. Timelines slip. None of that screams fraud on its own. It was only when the city finally pulled out the original functionality matrix and compared it line by line against what existed — and then found the internal document during discovery that showed Open knew the true numbers in March 2018 — that the pattern became undeniable.

The Default Notice as a Final Insult

While the city was still trying to save the project, Open International sent a notice of default to Fort Collins — essentially accusing the city of being the problem and threatening to halt work unless the city fixed certain deficiencies. The city’s own records describe this moment as a “significant breach of trust.” A vendor that had fraudulently induced the city into a contract was now, mid-project, pointing the finger at its victim.

The city responded with its own notices of dispute and termination on May 28, 2021. Open International then submitted a “Reset Proposal” that acknowledged the results of the functional matrix audit and asked for more money to finish the job. That audit had found only 17.3% of in-scope requirements had been accepted — a far cry from the 89.7% “A” grades Open had submitted in its proposal. The city rejected the Reset Proposal. Within weeks, it had retained a second vendor. By December 2021, the city had fully migrated away from Open International’s product and initiated this lawsuit.

In Their Own Words: The Damning Paper Trail

“The City learned that despite Open grading almost 90% of the required functionalities as an ‘A’ in its March 2018 RFP response, Open had internally assessed its software as meeting only 59.4% of the required functionalities. Open’s internal assessment was dated in March 2018, before it responded to the RFP.”

— U.S. Court of Appeals, Tenth Circuit, Opinion (July 23, 2025)

“Open International’s president agreed at trial that ‘No one at Open told the City [that Open] did not grade the Milestone portal in the RFP response.'”

— U.S. Court of Appeals, Tenth Circuit, Opinion (July 23, 2025), citing trial record

“The City’s CFO testified that realizing Open’s misrepresentations ‘was a gradual process’ and that the ‘functional matrix work was the point in time where [the CFO] said I think we may have gotten swindled.'”

— U.S. Court of Appeals, Tenth Circuit, Opinion (July 23, 2025), citing trial record

“[T]he presented portal was different than what got delivered.”

— City of Fort Collins, November 2019, as cited in U.S. Court of Appeals Opinion

“Open International sent a ‘Reset Proposal’ that acknowledged the results of the functional matrix audit — which showed that only 17.3% of the ‘[i]n scope’ requirements had been accepted — and sought additional funds to complete the project.”

— U.S. Court of Appeals, Tenth Circuit, Opinion (July 23, 2025)

“Industry standard is to provide factual and accurate responses of [the vendor’s] product or solution . . . at the time of response.”

— City of Fort Collins expert witness, trial testimony, as cited in U.S. Court of Appeals Opinion

Five Years From Fraud to Final Verdict

Who Actually Pays When a Vendor Commits Fraud on a City?

Economic Inequality: The Public Absorbs Costs Corporations Create

Fort Collins is a municipality. That means every dollar it spends on a fraudulent software contract is a dollar that came from taxpayers — residents who pay utility bills, property taxes, and fees that fund city operations. The court record shows the city not only paid for the broken software but also absorbed “most of the added project costs” when both parties agreed to extend the project in June 2020. A corporation sold a defective product and the public picked up the tab for the extensions.

Beyond the direct financial loss, the city spent years with a billing system that had “critical functionality missing” for its broadband utility, Connexion. Connexion was described as a “new broadband utility” — a public infrastructure project designed to give Fort Collins residents access to competitive internet service. Every month that billing software failed to function properly was a month the utility’s operational capacity was compromised. Residents who depended on Connexion for internet access were living with the downstream effects of a fraud committed in a Florida company’s RFP response.

The city also spent significant public resources on a third-party external project manager, a third-party consultant, twenty-nine separate change requests, two contract extensions, and ultimately an entirely separate vendor procurement and implementation process — all because a software company misrepresented its product to win a contract. Those resources had to come from somewhere. Public sector institutions do not have infinite budgets. Every dollar spent chasing a fraudulent vendor’s failures is a dollar not spent on roads, parks, housing assistance, or any other public service.

The structural power imbalance here is textbook. A well-resourced private company with the legal sophistication to draft merger clauses, limitation-of-liability provisions, and guarantee structures sold a product to a public institution. When the fraud was discovered, the company’s first move was to invoke every contractual provision available to shield itself from consequences — the economic-loss rule, the merger clause, waiver arguments, and a last-minute attempt to separate the parent company’s liability from the subsidiary’s. Fort Collins had to fight every single one of those arguments across multiple courts and multiple years. Most municipalities do not have the budget to do that. This city did. Many would not.

Public Health: Broadband as Essential Infrastructure

Access to functional broadband is a public health issue in the modern era. Fort Collins launched Connexion specifically to serve its residents with municipal broadband — an alternative to the private monopolies that dominate internet access across the United States. A malfunctioning billing and customer management system directly impairs a utility’s ability to serve its customers, resolve disputes, process payments, and manage accounts. The court record documents that the customer self-service portal, which went live in August 2019, immediately had “critical functionality missing” — meaning residents attempting to manage their own broadband accounts were met with a broken system from day one.

The city documented as far back as November 2019 that “portal testing hours have been extensive” and that the portal delivered was different from the one demonstrated during vendor selection. For a broadband utility serving residents who may depend on the service for remote work, telehealth, remote education, or emergency communications, a broken account management system is a direct impediment to reliable access. The people harmed by that gap were not the software company’s shareholders. They were Fort Collins residents.

The Cost of Fraud, Translated