AFFILIATED COMPUTER SERVICES, INC. AND SUBSIDIARIES 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED) 

which includes attorneys' fees and pre judgment interest, but excludes additional attorneys' fees of approximately $0.9 million 

and post judgment interest at the statutorily mandated rate of 10% per annum, which could be awarded in the event the 

plaintiffs are successful upon appeal and final judgment.  The judgment was appealed by the plaintiffs and us. 

On August 29, 2002, the Fourteenth Court of Appeals, Houston, Texas, reversed the trial court's judgment and remanded the 

case to the trial court for further proceedings.  However, the court of appeals affirmed the trial court judgment in part as to one 

of the plaintiffs.  The court of appeals also held that the trial court did not err in dismissing certain of our affirmative defenses 

at a pretrial conference. We and the plaintiffs filed motions for rehearing with the court of appeals.  On January 16, 2003, the 

court of appeals denied both motions for rehearing (except the court reversed its previous ruling that the trial court should have 

applied prejudgment interest at 6% rather than 10%).  

On March 3, 2003, we filed a Petition for Review with the Texas Supreme Court requesting that the Court reverse the decision 

of the court of appeals and render judgment that the plaintiffs take nothing or, alternatively, remand the case to the trial court 

for further proceedings.  The plaintiffs did not file a petition for review with the Texas Supreme Court.  On June 19, 2003, the 

Texas Supreme Court requested that the parties file briefs on the merits of the appeal.  We filed our brief on the merits on 

August 20, 2003, and the plaintiffs  brief on the merits is currently due by October 9, 2003.

We continue to believe that we have a meritorious defense to all or a substantial portion of the plaintiffs' claims, and 

accordingly, have not accrued any amount on our balance sheet related to the lawsuit. 

One of our subsidiaries, ACS Defense, Inc., and several other government contractors received a grand jury document 

subpoena issued by the U.S. District Court for the District of Massachusetts in October 2002.  The subpoena was issued in 

connection with an inquiry being conducted by the Antitrust Division of the U.S. Department of Justice.  The inquiry concerns 

certain IDIQ (Indefinite Delivery   Indefinite Quantity) procurements and their related task orders which occurred in the late 

1990s at Hanscom Air Force Base in Massachusetts.  Our revenue from the contracts that we believe to be the focus of the 

Justice Department's inquiry is approximately $25 million per year representing approximately 0.6% of our annual revenue.  

We are conducting an ongoing internal investigation of this matter through outside legal counsel and we are cooperating with 

the Department of Justice in producing documents in response to the subpoena and arranging for Department of Justice 

interviews of employees and former employees. 

Another of our subsidiaries, ACS State & Local Solutions, Inc., and a teaming partner of this subsidiary, Tier Technologies, 

Inc. ("Tier"), received a grand jury document subpoena issued by the U.S. District Court for the Southern District of New 

York in May 2003. The subpoena was issued in connection with an inquiry being conducted by the Antitrust Division of the 

U.S. Department of Justice. The inquiry concerns the teaming arrangement between ACS and Tier Technologies on child 

support payment processing contracts awarded to ACS and Tier Technologies, as a subcontractor to ACS, in New York, 

Illinois and Ohio. Our annual revenue from these three contracts will be approximately $70 million when the services are fully 

implemented, representing approximately 1.8% of our annual revenue. Our teaming arrangement also contemplated the 

California child support payment processing request for proposals which is expected to be issued in September or October 

2003; however, we

have not entered into a teaming agreement with Tier for California and do not expect that we and Tier 

Technologies, Inc. will team together on a proposal in response to this request for proposals. We are conducting an ongoing 

internal investigation of this matter through outside legal counsel and we are cooperating with the Department of Justice in 

producing documents in response to the subpoena. 

Due to the preliminary nature of these government inquiries, it is difficult to assess the impact, if any, of these inquiries on 

ACS.  

In addition to the foregoing, we are subject to certain other legal proceedings, inquiries, claims and disputes which arise in the 

ordinary course of business.  Although we cannot predict the outcomes of these proceedings, we do not believe these actions, 

in the aggregate, will have a material adverse effect on our financial position, results of operations or liquidity.  

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