Maryland's Office of the Attorney General paid a software vendor roughly $2.3 million combined over recent years even though the case management system it was buying was never fully installed, according to a new state audit. Auditors also found the office could not properly track what it owed outside law firms, raising fresh questions about financial oversight inside the agency responsible for representing the state in court.
The findings come from the Maryland Office of Legislative Audits, described in the audit as a nonpartisan office that conducts regular evaluations of state agencies. As reported by the Maryland Daily Record, the office did not properly track outside counsel payments or effectively monitor the vendor selected to oversee its case management system. The Attorney General's Office originally entered into a $3.6 million contract in June 2017 for the system, and a separate audit report from the Office of Legislative Audits examined whether the office received all of the critical deliverables tied to that procurement.
Payments Continued as Deliverables Went Undelivered
According to the audit, the contract for the case management system included weekly status reports as a critical component, yet the Attorney General's Office continued making payments despite the vendor's failure to implement contractually specified system components. The system was not fully installed, and as of this past April, it remained not fully implemented in one division and installation had not even begun in another, per the same account.
The contract expired in June 2025, but the office renewed it twice, and separately paid $1.8 million to the vendor as of March of this year, on top of an additional $475,000 in vendor implementation costs. The Attorney General's Office also entered into a licensing and maintenance contract to keep operating the current system while it continues to fall short of full implementation. Despite the renewals, the office did not notify the Maryland Board of Public Works, which approves contract procurements and extensions for state agencies, about the issues it was having when it sought to renew the provider's contract in 2023.
No Damages Sought, Despite Shared Blame
Notably, the Attorney General's Office did not seek damages from the service provider. In its response to auditors, the office claimed it shared partial responsibility for the failed implementation because it had inadequately monitored the contract itself. Going forward, the agency said it will review all vendor payments by January 31, 2027, to seek recovery for undelivered services, and plans to retire the current case management system once it procures an enterprise-wide matter management system overseen by a designated contract monitor.
That future monitor, according to the agency's response, will maintain a log of contract-critical deliverables — including status reports and transition plans — and will confirm receipt of required deliverables before approving related invoices.
Outside Counsel Spending Also Hard to Track
The audit additionally found that the Attorney General's Office did not create purchase orders through the state accounting system for its outside counsel contracts, leaving the office unable to easily determine how much state agencies owed for legal services. Between June 16, 2022, and May 12, 2026, the office had entered into 120 contracts with 97 law firms. From June 16, 2022, through the end of May 2026, 53 Maryland state agencies paid approximately $63 million to 54 law firms.
Auditors could not determine the total outside-counsel fees paid for services used by each agency, nor the total claims and settlements paid statewide. The audit report notes that some agencies paid for services actually provided to another agency, some recorded payments were not for legal services to the state at all, and the state accounting system omitted some payments to outside counsel entirely — meaning the outside counsel payment totals may not reflect each agency's actual legal costs.
The Attorney General's Office has maintained an outside counsel contract repository since 2023. In its response, the agency said that before the repository existed, outside counsel retention and assignment processes were dispersed across the agency with no centralized recordkeeping, and that its management of outside counsel is now undergoing refinement and improvement.
A Broader, Harder-to-Measure Problem
The difficulty in tracking legal spending extends well beyond this single office. As the Baltimore Sun reported this past summer, Maryland tracks legal spending across its agencies, but no office compiles a verified statewide total for outside law firms, making it difficult to measure the state's overall spending on outside counsel. The state's inability to properly budget for outside counsel services, or to maximize its purchasing power when negotiating contract rates, stems from that same lack of centralized visibility.
Whether the current Attorney General's Office review will result in any recovered funds from its own vendor has not yet been determined.
