The Municipality of Anchorage has blamed three companies for the failure of the Port of Anchorage expansion project in a lawsuit filed in U.S. District Court, and on Tuesday it asked a federal judge to add a fourth name to the list of defendants.
Seattle-based GeoEngineers, the municipality says, partnered with PND Engineers Inc. to complete the final design of the port expansion -- a project fraught with problems that has cost more than $300 million and remains only partially complete. GeoEngineers also co-authored a report in 2008 with PND that backed the port expansion's design, according to a motion filed by the municipality in U.S. District Court.
The municipality said it moved to amend its complaint, bring additional claims against defendants and claims against GeoEngineers "based on information it has obtained through its own ongoing investigations of the matter and the ongoing discovery process," according to the motion.
U.S. District Judge Sharon Gleason did not rule on the municipality's motion -- or any motions -- Tuesday. For about 90 minutes, attorneys for the municipality and the three defendants presented arguments to Gleason and pointed fingers at who may be culpable in the case of the troubled port expansion project.
The oral arguments on Tuesday were the most recent action in the lawsuit filed last year by the municipality against ICRC, the project construction manager; PND Engineers Inc., the port designer; and CH2M Hill Alaska Inc., for work done by Veco Alaska Inc., which it acquired in 2007, analyzing the expansion's design for stability.
The municipality is also involved in an ongoing lawsuit with the U.S. Maritime Administration, the agency charged with overseeing the port expansion, in efforts to recover money poured into the project.
Bob Owens, an assistant municipal attorney, said the municipality is seeking a total of about $340 million in damages from the two lawsuits, a number he called "very preliminary."
On Tuesday, attorneys representing PND and CH2M Hill asked for claims against them to be dropped, arguing that when the municipality sued the two subcontractors it bypassed the "chain of contracts." ICRC subcontracted with PND, which subcontracted with Veco, or CH2M Hill.
Jahna Lindemuth, an attorney representing PND, said the municipality should focus on seeking damages from ICRC and MARAD. The entities could in turn pursue litigation against the subcontractors, which include PND and CH2M Hill.
William Cronin, an attorney representing CH2M Hill, said the court should dismiss the municipality's professional negligence claim against the company. He said the claim would stand only if there was injury to persons or property in the port expansion project, which he said didn't occur.
But the municipality countered, saying the 53 acres of land created to the north of the existing port constitutes damaged property. Since construction stopped, the municipality has paid $50 million to stabilize the area from further loss, said Bennett Greenberg, an attorney representing the municipality.
The property in question is where construction began on the port expansion project, using a design called "open cell sheet pile," patented by PND. Instead of a traditional dock on pilings, long sheets of steel were driven into the Knik Arm seabed to create a new dock face. The sheets connected to one another in U-shapes that would be backfilled by gravel and create new land. But some of the sheets bent, twisted and jammed during installation.
Greenberg said it was concluded that the open cell sheet pile was unstable. "So we believe the risk of the project is real," he said.
PND and CH2M Hill said the new land is considered the product -- not damaged property. "This would be an entirely different case if there had been a big failure and it had fallen into the ocean," Lindemuth said.
Kurt Hamrock, an attorney representing ICRC, spoke over the phone in court Tuesday and underscored the role the federal government played in the port expansion project, from MARAD to the Army Corps of Engineers to the National Marine Fisheries Service and "potentially other agencies."
All parties agreed that MARAD couldn't be brought into the federal lawsuit -- the only thing they agreed upon Tuesday, Gleason pointed out. The city's suit against MARAD is in the U.S. Court of Federal Claims.
Greenberg told Gleason that the municipality is seeking the same damages in both lawsuits, though it is not interested in recovering damages more than once. "If we had a judgment against MARAD for $200 million, our damages in this case would be reduced accordingly," he said.
The parties briefly discussed ICRC's motion to compel the deposition of 86-year-old Bill Sheffield, former Alaska governor and retired port director. ICRC argued that Sheffield should submit out-of-court testimony as soon as possible, while PND and the municipality opposed the motion.
Gleason did not specify when she would rule on the motions discussed Tuesday. The case is set to go to trial next year.