Centegix Lawsuit: CMS Contract, Claims, and Settlement

The Centegix lawsuit was a 2020 federal case in which Charlotte-Mecklenburg Schools sued the Atlanta-based maker of the CrisisAlert panic-badge system after a $1.75 million rollout across 26 high schools failed repeatedly during testing and live incidents. The district alleged breach of contract, breach of warranties, and unfair trade practices. It settled in October 2020 for a $475,000 refund and the return of all equipment, leaving CMS out at least $655,000 on a system it never fully deployed.¹

What CMS Bought

In November 2018, Charlotte-Mecklenburg Schools awarded a bid to 34 ED, LLC, doing business as Centegix, to install the CrisisAlert system in 26 high schools. The purchase agreement totaled $1.75 million. CrisisAlert was designed to let staff summon help during an emergency by pressing a button on a wearable badge, which would trigger color-coded lights and alerts across the building. The pitch was faster notification than dialing 911 or reaching the front office.

The rollout began with a pilot at Charlotte East Language Academy and was scheduled to expand from there. The deal was executed through purchase orders rather than a board-approved contract, which bypassed formal school board oversight. CMS paid more than $1.13 million before terminating the relationship.

How the System Failed

Problems appeared almost as soon as installation began in 2019. During a June 2019 test at Charlotte East Language Academy, a teacher triggered the alarm and no mobile or desktop alert went out. Additional badges in the building also failed. Senior project manager Pam Fandel wrote the following day, “The communication and support from this company is concerning. Had this been a life threatening situation we would be in big trouble.”² By August, Fandel described her “daily struggle” as getting the system “installed correctly and working 100 percent at the schools.”

The failures spread beyond a single campus:

Beacons meant to flash color-coded alerts malfunctioned repeatedly, and in some cases fell out of ceilings.³
During a January 15, 2020 incident at Independence High School involving a report of a student with a gun, many beacons did not activate, and lights failed to shut off properly afterward.³
On January 27, 2020, staff at Independence used panic cards to request help during a fight. The system triggered a school-wide lockdown that no one on site could deactivate. Centegix employees in Georgia had to shut it down remotely. Neither the principal nor school police received alerts on their devices.³
A January 13, 2020 test at Independence found 43 non-working beacons and 17 more with low-light or failing-battery issues.
The system frequently played incorrect audio, and weather and evacuation messages were cut off.⁴
CMS staff also documented that Centegix technicians were frequently late, ignored directives to stop making fixes until testing was complete, and failed to return master keys to schools.²

Internal warnings went unheeded. In May 2019, CMS senior purchasing agent Amy Shire formally recommended that the district not proceed with a second bid “until all issues and risks are settled.” Four minutes later, the director of information systems decided the technology team would proceed anyway.² CMS promoted the system in its 2019–2020 parent-student handbook even as staff continued to document its failures.

The Claims and a Mediation Detour

Superintendent Earnest Winston acknowledged in January 2020 that the system was not working and gave Centegix 30 days to fix it.⁴ When the company missed the February 10, 2020 deadline, CMS terminated the contract and withheld the remaining $600,000 in payments.⁵

On April 29, 2020, the Charlotte Mecklenburg Board of Education sued 34 ED, LLC d/b/a Centegix in the U.S. District Court for the Western District of North Carolina, case number 3:20-cv-00259.⁶ The complaint alleged that Centegix knew the system was non-functional when it pitched the product and failed to deliver goods conforming to the contract. CMS brought three claims: breach of contract, breach of warranties, and violation of the North Carolina Unfair and Deceptive Trade Practices Act.

Centegix responded that it had met all agreed-upon success criteria. It also raised a procedural defense: CMS’s own standard terms required the parties to attempt mediation in good faith before filing suit, and CMS had skipped that step. On July 14, 2020, the court agreed. The judge found it was undisputed that CMS had made no formal effort to mediate before suing, stayed the litigation, and ordered both sides to pursue mediation immediately.⁶

How It Settled

Mediation resolved the case. By October 2020, CMS and Centegix reached a settlement in which Centegix refunded $475,000 to the district and agreed to pay for removing all equipment from CMS schools and returning it to Georgia.¹ Each side covered its own legal fees. Neither party admitted fault. In a joint statement, the two called it a “mutually agreeable resolution” and declined to comment further.

The financial picture was still poor for CMS. The district had paid more than $1.13 million and recovered less than half. After the refund, it was out at least $655,000 for a system it never fully used.¹ CMS confirmed it no longer uses Centegix and now relies on an internal police force, school resource officers, metal detectors in 200 buildings, camera systems, panic buttons, and buzzer-entry doors.⁷

Centegix After the Case

The settlement did not slow the company. Centegix, founded in 2017 by Daniel Dooley and led by CEO Brent Cobb, has grown into one of the larger vendors in the school safety technology market.⁸ As of 2025, it reports protecting more than 15 million people across over 15,000 sites in 48 states, with CrisisAlert in use in four of the ten largest U.S. school districts.⁹ Much of the growth has been driven by “Alyssa’s Law,” a wave of state legislation requiring silent panic alarms in public schools.¹⁰

The CMS episode drew renewed attention on September 4, 2024, when a gunman killed two teachers and two 14-year-old students and injured nine others at Apalachee High School in Winder, Georgia. The Barrow County district had been using CrisisAlert for about a week. Staff members pressed their badges during the attack, the system alerted law enforcement to the precise location, and officers arrived within minutes. Georgia Bureau of Investigation Director Chris Hosey said the rapid activation “prevented this from being a much larger tragedy.”¹¹ WBTV reported the following day on the contrast with CMS’s earlier experience with the same vendor.⁷

For anyone searching the case itself, the record ends where the settlement ends: no admission of fault, a partial refund, equipment removed, and a district that walked away with a six-figure loss and a different approach to school security.

1
WFAE. CMS Gets $475,000 Refund for Failed Panic Alarm System, Still Out at Least $655,000
2
Charlotte Observer. CMS Internal Documents Reveal Crisis Alert System Failures
3
GovTech. School District Wants Refund After Crisis Alert Tech Fiascos
4
WBTV. CMS Sues Crisis Alert Company to Recoup More Than Million Spent on Failed Security System
5
GovTech. Alert System Being Dropped After Company Failed to Meet Deadline
6
US Arbitration / A&O Shearman. Charlotte Mecklenburg Board of Education v. 34 ED, LLC d/b/a CENTEGIX, No. 3:20-cv-00259
7
WBTV. CMS Terminated Contract With Security Alert System Used During Georgia School Shooting
8
CENTEGIX. About CENTEGIX
9
PR Newswire. CENTEGIX Accelerates Nationwide Safety Momentum in 2025
10
CENTEGIX. Alyssa’s Law
11
Education Week. A Panic Button May Have Saved Lives in Georgia School Shooting