Zimmer Biomet has filed a lawsuit against Deloitte in the Supreme Court of the State of New York in Manhattan, seeking at least $172 million in damages over what it describes as a catastrophic failure of an enterprise resource planning (ERP) project. The Warsaw, Indiana–based orthopedic device giant alleges that Deloitte misrepresented its expertise and sold the company on a cloud-based SAP S/4HANA system that turned into a costly operational disaster.
The lawsuit, filed on September 4, outlines a story of broken promises, mounting costs, and severe disruption to Zimmer Biomet’s global operations. At the heart of the complaint is the claim that Deloitte convinced company executives it had the skills, experience, and proven methodology necessary to deliver the project successfully. Deloitte, Zimmer Biomet says, drew on more than 25 years of prior collaboration and trust to secure the contract, persuading the company that replacing its legacy ERP system with SAP’s next-generation software would unlock between $197 million and $316 million in savings over 10 years.
Instead, the result was what Zimmer Biomet calls an outright failure. According to the company, Deloitte’s team was incompetent and unqualified, heavily reliant on an offshore team in India with little oversight and constant turnover. This lack of consistency, Zimmer Biomet claims, meant the project was never supported by a stable or qualified implementation team.
From delays to disaster
The ERP rollout was plagued with delays, finally going live in North America on July 4, 2024, after multiple postponements. Even then, the system was not implemented globally as intended—it was limited to North America, leaving Zimmer Biomet’s broader Latin American operations outside the promised scope. From the moment of go-live, operational issues surfaced. Deloitte allegedly downplayed these problems as “typical hiccups” for an S/4HANA launch, assuring Zimmer Biomet they would resolve over time.
But as the weeks passed, the problems deepened. Zimmer Biomet describes its operations during the third quarter of 2024 as barely functional:
The company was unable to ship or receive products.
It could not issue invoices or generate basic sales reports.
Its global supply chain was massively disrupted, delaying the shipment of critical medical devices to hospitals and doctors.
The impact was severe enough that Zimmer Biomet had to cut its full-year 2024 guidance when reporting third-quarter earnings in October. In its lawsuit, the company claims the ERP disaster inflicted more than $172 million in damages, only mitigated by extraordinary internal efforts to prevent even worse disruption.
A relationship in collapse
Zimmer Biomet’s frustration is compounded by Deloitte’s alleged approach to project management. The company claims Deloitte repeatedly “change-ordered [them] to death,” issuing 51 change orders worth an additional $23 million on top of the original $69 million contract price. According to Zimmer Biomet, these change orders would not have been necessary had Deloitte properly scoped and sized the project at the outset.
By July 1, 2025, Zimmer Biomet formally notified Deloitte that it was in breach of its contract. In what Zimmer Biomet describes as an abrupt move, Deloitte canceled all contracts six weeks later, leaving the company scrambling to maintain operations. To avoid further disruption, Zimmer Biomet says it was forced to pay outstanding invoices and prepay for termination assistance services to keep Deloitte engaged until the end of the year.
In total, Zimmer Biomet claims at least $173 million in damages, including:
$94 million already paid to Deloitte in fees.
$15 million more invoiced as Deloitte attempted to fix its own mistakes.
$72 million in post-go-live costs shouldered by Zimmer Biomet.
The complaint also underscores the human impact of the project’s failure. With operations disrupted and shipments halted, doctors and patients relying on Zimmer Biomet’s medical devices faced delays. “This is not the conduct we expect nor tolerate from our business partners,” said General Counsel Chad Phipps, who emphasized that Deloitte’s missteps not only disrupted business but also put patient care at risk.
Deloitte responds
For its part, Deloitte has rejected the allegations outright. In a statement, the firm said: “We are deeply committed to our clients, regret that Zimmer Biomet has chosen to embark on this path, and will defend ourselves vigorously against this meritless claim.” Deloitte framed the lawsuit as unfounded and signaled that it would not accept responsibility for what Zimmer Biomet describes as a systemic failure.
The clash between Zimmer Biomet and Deloitte highlights a broader challenge in the ERP implementation market, where large-scale projects carry high risk, high cost, and often a track record of troubled rollouts. ERP failures are not unique, but when they occur in industries like medical devices—where operational downtime can directly affect patient care—the stakes are especially high.
For Zimmer Biomet, the lawsuit marks an escalation in what has become a costly and contentious dispute. The company is now seeking to recover losses, hold Deloitte accountable, and perhaps set an example for how large corporations should scrutinize promises made during complex technology transitions.
ERP project failures and corporate lessons from Zimmer Biomet’s lawsuit
Zimmer Biomet’s $172 million lawsuit against Deloitte is more than just a corporate dispute — it is a case study in the risks of large-scale ERP transformations. Across industries, companies have long struggled with ERP projects that promise efficiency, cost savings, and standardized operations, but instead deliver cost overruns, delays, and operational paralysis. The orthopedic device giant’s experience underscores the importance of accountability in high-stakes digital transformations and highlights the growing demand for transparency in consulting-led projects.
The high failure rate of ERP projects
Analysts estimate that up to 55–75% of ERP projects either fail outright or fall short of expected benefits. These failures often stem from a mix of poor planning, unrealistic expectations, insufficient change management, and vendor overpromising. In Zimmer Biomet’s case, the lawsuit alleges that Deloitte overrepresented its skills and methodology, relied excessively on offshore resources with high turnover, and consistently underestimated the scope of the project.
The company’s allegations echo a familiar pattern:
Scope creep: What begins as a tightly defined project often expands into unmanageable complexity, with “change orders” ballooning costs. Zimmer Biomet claims Deloitte issued 51 change orders totaling $23 million beyond the original contract.
Operational disruption: When go-live dates are forced despite unresolved issues, companies risk grinding their operations to a halt. For Zimmer Biomet, that meant delays in shipping critical medical devices and lost revenue.
Trust erosion: Longstanding partnerships can create blind spots. Deloitte had worked with Zimmer Biomet for over 25 years, a history of trust that may have dulled the company’s scrutiny of promises and risk assessments.
Impact on the MedTech industry
For the medical technology sector, the consequences of ERP failure extend beyond financial losses. Unlike retail or manufacturing, MedTech companies deal with products that directly affect patient outcomes. Disruptions in supply chains can result in delayed surgeries, postponed treatments, and compromised patient care. Zimmer Biomet’s claim that its ability to ship devices to doctors and hospitals was halted shows how IT failures in MedTech carry stakes far greater than lost revenue.
Regulators and hospital partners may also pay closer attention to technology readiness in the wake of such failures. If ERP instability can compromise timely delivery of implants, surgical tools, or devices, companies risk reputational harm and erosion of trust with healthcare providers. This lawsuit could, therefore, trigger broader conversations in the industry about risk management in digital transformation.
Lessons for corporate IT leaders
Zimmer Biomet’s case carries lessons for CIOs, CFOs, and boards overseeing major ERP initiatives:
Vet vendor expertise rigorously. Longstanding relationships are not a substitute for demonstrated, recent expertise in the specific platform being implemented.
Scrutinize implementation methodologies. Claims of accelerators, best practices, or proprietary tools should be verified with real-world case studies, not marketing materials.
Plan for oversight and continuity. Excessive reliance on offshore teams without stable oversight can compromise project quality and institutional knowledge.
Manage scope tightly. Change orders often reflect inadequate planning. Organizations must ensure project scoping is comprehensive from the outset.
Prioritize risk mitigation. In industries where operational disruption impacts public health, contingency planning must be robust.
The consulting industry under scrutiny
This lawsuit also places a spotlight on the consulting industry at large. Deloitte is not the first major firm to face litigation over ERP failures, and it will not be the last. For years, consulting giants have pitched ERP transformations as pathways to efficiency and growth, while too often underestimating the complexity of implementation.
The lawsuit raises broader questions:
Should consulting firms face greater accountability for failed implementations?
Are contractual safeguards sufficient to protect clients from runaway costs and failed outcomes?
Will cases like Zimmer Biomet’s lead to more performance-based contracts, where payment is tied to project success?
A potential ripple effect
If Zimmer Biomet succeeds in its case, it may embolden other corporations that have suffered costly ERP failures to pursue legal action. That could create a chilling effect on consulting practices, pressuring firms to adopt more conservative and transparent approaches to project scoping and delivery. At the same time, vendors like SAP SE may face renewed scrutiny, as clients distinguish between the underlying software platform and the consultants implementing it.
Zimmer Biomet’s lawsuit could also accelerate a trend toward modular, phased ERP adoption, rather than sweeping “big bang” transformations. Companies increasingly prefer agile, incremental rollouts that reduce risk while allowing for ongoing optimization. This approach may not only reduce failures but also align better with today’s dynamic business environments.
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