Delivering a major setback to Tampa Bay Water, a federal jury on April 10 decided that HDR Engineering's design was not the cause of large cracks at the utility's six-year-old, 15.5-billion-gallon reservoir in Lithia. Less than four hours after receiving the case from U.S. District Court Judge James D. Whittemore, the jury announced its unanimous verdict clearing the Omaha-based engineering firm of responsibility.
During closing arguments earlier in the day, Tampa Bay Water attorney Richard Harrison had asked the jury to force HDR to pay $73.2 million in damages for the cracks. The utility had argued that HDR's poor design of the reservoir had resulted in excess pore pressure in the reservoir's embankment, which caused the cracks that occurred in two sections of the facility. In October 2011, after rejecting a $30-million mediator-initiated settlement offer, the utility had stated that it did so in part because legal advisers had indicated that it could receive up to $97 million from a trial.
The 15.5-billion C.W. "Bill" Young Regional Reservoir remains fully operational. Photo courtesy Tampa Bay Water
But that didn't happen. The jury of six women and four men gave a surprisingly quick answer to the only question they ended up considering: Did HDR breach its Standard of Care for its design, and was that the legal cause of damage to Tampa Bay Water?
If their answer to that question was No, Judge Whittemore instructed, then they need not consider any damages, and their work would be done. At around 4:30—just minutes after the court responded with guidance to the jury's second question of the day—the jury announced they had reached a verdict. A court administrator read the verdict, and within minutes Judge Whittemore had formally concluded the nearly month-long case.
Tampa Bay Water had been hoping that the damages it would receive from a trial would help fund the $162-million renovation and expansion design-build project it has initiated with Kiewit Infrastructure Group, Omaha.
At a press conference held shortly after the verdict, Tampa Bay Water's general manager, Gerald Seeber, stated: "Saying we are disappointed is an understatement. We feel strongly that the public shouldn't have to pay twice for a fully functioning reservoir. We hired HDR to design the facility. HDR certified its design and the construction to the state, so we believe HDR is liable. We'll discuss the verdict with our board and consider our legal options, including a possible appeal."
During the press conference, TBW attorney Harrison wouldn't cite the justification they could use for an appeal, but said the matter would be discussed at a closed-door meeting with the board scheduled for April 16.
The design that Kiewit is preparing to implement for its "permanent fix" will include stair-step cement for the embankment, instead of flat-plate soil cement, which HDR's design utilized. (Image courtesy Tampa Bay Water)
Asked whether the $162.4-million contract with Kiewit could possibly be cancelled, and whether the utility's board would support the rate increases that would likely be necessary to fund the pending work, Seeber said, "I believe the board will forge ahead."
"We're very disappointed; [the verdict] is not something we expected," he said. "But we're going to move forward."
To his knowledge, Seeber said, the TBW board remains committed to a policy of delivering a diversified and flexible water supply system, and that means implementing a permanent fix of the reservoir. "And we'll continue until advised differently."
The reservoir remains fully operational. The new project will reconstruct the reservoir's embankment, and provide a greater, pump-driven drawdown rate than was previously possible with the gravity drainage system included in HDR's original design.
HDR CEO and Chairman George A. Little provided a statement to ENR shortly after the verdict: "Our guiding principle has always been to do the right thing for our clients and to work together on solutions if problems arise. Sometimes that's not possible and results in litigation. We are pleased the jury based its decision on the facts and found in our favor."
On the website it created to rebut Tampa Bay Water's charges, www.tbwlitigation.com, HDR further stated: "We are sorry this client chose to litigate instead of collaborate on a solution, placing the financial burden on ratepayers as a result."
As HDR lead attorney Wayne Mason told the jury during his closing arguments, Tampa Bay Water had the burden to prove that its theory of excess pore pressure was the cause of the cracks. During the trial, HDR argued that construction defects caused the cracks, and cited photos that seemed to show soil being placed improperly. Tampa Bay Water had previously settled with its construction manager, Construction Dynamics Group (now part of ARCADIS), for $6 million, and with general contractor Barnard Construction for $750,000.
Outside the courthouse, attorney Mason told members of the media that he was "very confident" that the verdict would stand.