Honolulu rail builders sue HART for $324M

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Dive Brief:

• Builders working on the $10 billion Skyline rail project filed suit against Honolulu Authority for Rapid Transportation and the City and County of Honolulu, seeking at least $324 million in damages for breach of contract and unjust enrichment.
• Hitachi Rail Honolulu Joint Venture filed the lawsuit on Dec. 20, alleging that the defendants’ mismanagement of the Skyline project “has led to countless delays and other errors resulting in significantly increased costs for HRH.” 
• Hitachi is a key contractor on the project, responsible for installing and maintaining the operating system for the driverless trains. HART hired the JV, a partnership between Hitachi Rail STS SpA and Hitachi Rail STS USA, in 2011, per the suit.

Dive Insight:

This is just the latest in a string of lawsuits to arise on the project, according to Honolulu Civil Beat. In 2023, the Shimmick/Traylor/Granite team hired to build part of the Honolulu rail line sued HART, alleging that the agency failed to address problems with utility relocation, which caused expensive construction delays. HART later settled for $60 million.

The entire Skyline project was originally supposed to open by 2020, but the latest estimates put that finish date at 2030, according to Civil Beat. The nearly 19-mile elevated guideway system includes 19 stations and runs from East Kapolei to Kakaako.

Per Hitachi’s lawsuit, the city chose not to hire a single design-build contractor to develop the entire system “as is common in the rail industry.” Instead, Honolulu and HART awarded smaller design and construction contracts to numerous contractors.

However, HART “was not up to the task of coordinating the numerous contractors involved – a task vital to the project delivery system HART chose. HART’s failures in leadership and coordination resulted in extraordinary delays and cost overruns,” the lawsuit alleges.

Hitachi said it could not do its job until other contractors built the elevated guideway, stations and track, and alleges that it was forced to eat the costs of overruns. The JV further alleges that the city “delayed any good faith efforts to resolve HRH’s claims, no doubt to delay further public criticism of its Skyline project mismanagement.”

Honolulu officials did not respond to Construction Dive as of publication time, and HART declined to comment.

“HART appreciates the opportunity to respond, but at this time we are not able to discuss or comment on the active claim,” Joey Manahan, HART’s director of government relations and public involvement, said in an email.