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Desire2Learn Backs Away from Customer Lawsuit

• By Dian Schaffhauser
• 01/20/11

Nine days after filing a civil suit against a statewide network of colleges and universities that had chosen an alternative learning management system (LMS) from a new competitor, Desire2Learn has backed away from its legal protest. The Canadian company was one of three finalists under consideration to implement an LMS for the Utah Education Network, a consortium of public education partners, including the Utah System of Higher Education. The civil suit named both the network and the University of Utah, but not Instructure, the company that won the contract.

The seeds of the incident were planted in September 2010. That's when an evaluation committee with representatives from each college and university in the Network announced a request for proposal (RFP) outlining the needs for a replacement to the consortium's LMS, Blackboard Vista (formerly WebCT Vista). The contract for that legacy system was due to expire in June 2012. Since Blackboard had announced that it would stop supporting Vista in December 2012, the consortium informed its institutions that they would have to shift to another platform by June of that year.

The committee jointly developed the RFP and posted it through the U Utah Purchasing Department on BidSync Oct. 15. Proposals were due about a month later. By Nov. 23 an initial evaluation round settled on the three finalists--Desire2Learn, Instructure, and Blackboard--from the eight proposals submitted. Each finalist gave a presentation to the evaluation committee and a second presentation to faculty and students. The vendors' references were checked and the committee analyzed costs of the proposals.

In late December 2010 the committee announced its selection of Utah-based Instructure as the winner of the work. Instructure's product, Canvas, is delivered as software-as-a-service. The company said it has 26 different institutions under contract--and 17 of those are in the Utah network. Current Instructure customers, according to the company, also include Utah's Westminster College in Salt Lake City and Park City School District.

Desire2Learn delivered a letter protesting the award to the Utah Division of Purchasing and General Services, housed at the University of Utah. The letter cited two grounds for protest.

First, the LMS company found it implausible that a newcomer could have fairly won the contract. "It is difficult for D2L to understand how Instructure could have out‐scored D2L's products, services, and proven track record in light of the enumerated and prioritized scoring criteria contained in the [request for proposal]," the letter stated. "Considering the scope and scale of the work identified in the RFP, D2L is puzzled that the selection committee selected a vendor with very little experience and a small workforce for the project."

Second, Desire2Learn's letter suggested that there was a conflict of interest that required further investigation. That conflict involved an individual who, according to Desire2Learn, had participated in the preparation of a specification contained in the RFP and was now working for Instructure.

According to Josh Coates, Instructure's CEO, that conflict of interest was much "duller" than the protest letter suggested. The individual in question had previously worked at Utah State University as a system administrator in charge of the LMS. He was subsequently laid off, performed temp work, and then was hired by Instructure as a member of the support staff. "Some months after he left Utah State, the RFP started to be formulated," said Coates.

At Utah Valley University, one of the consortium's institutional members, the evaluation for determining its ultimate vote for Instructure took into account the evaluations of 10 people from administration, faculty, staff, and the student body, as well as a campus-wide survey, according to committee member Jared Stein, director of Innovation in Instruction and Technology Distance Education.

Stein said he's not "blind" to the possible risks associated with Instructure. "However, the newness and relatively small size of Instructure is in many ways an advantage. The company is fresh, nimble, and responsive. For instance, their product is not yet homogenized or hindered by the weight of the demands of hundreds of other institutions. And while Canvas is full-featured, the system design isn't based on years of LMS architecture that primarily serves to preserve the instructional status quo. Finally, we are already receiving tremendous attention and support from Canvas developers regarding our ideas and feedback."

The director of procurement and supply management at U Utah, James Parker, responded to Desire2Learn's protest 10 days after receiving it. After a review of the documentation related to the RFP, the university determined that the complaint had "no merit" and it proceeded with its award to Instructure.

By Jan. 11, 2011, Desire2Learn had filed its claim for relief, which requested repayment of the costs it had incurred in preparing its response to the RFP, termination of the contract the network had with Instructure, and a request to reward the contract to Desire2Learn or put it back out for bid. It's this suit that Desire2Learn decided to back away from.

The change of heart came via a blog comment posted by John McLeod, Desire2Learn's director of marketing. "Out of respect for institutions in Utah and our desire to concentrate on serving our customers, we are immediately dropping this appeal. We want to reassure everyone that our focus continues to be on improving education," McLeod wrote in response to an entry by Michael Feldstein on his blog, "e-Literate."

"I think it's odd to sue your potential customer," noted Instructure's Coates, who added that the lawsuit hasn't slowed down his company's work with the Network. "We're moving right ahead with course migration and training of the administrators."

The uptake of Canvas by faculty members is much faster than anticipated. "We have hundreds of teachers that want to go live. That's been a new thing neither [the Network] nor we anticipated," Coates said. "We think the sooner faculty and students can start using our system, the sooner we can take education in Utah to the next level. We're excited about that."