A lawsuit brought against Bechtel National by one of its subcontractors at the Hanford vitrification plant has been settled through mediation.
American Crane and Equipment Corp. of Pennsylvania sued Bechtel in 2013, saying problems at the vitrification plant had added $3.9 million to its costs that would not be compensated.
U.S. Judge Lonny Suko dismissed the case earlier this month after the two companies reached a settlement. Terms were not disclosed.
“It was resolved through mediation, which by definition is a consensual resolution,” said John Person, attorney for American Crane.
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Bechtel takes legal claims seriously and worked diligently to resolve the matter, said Bechtel spokeswoman Suzanne Heaston.
American Crane had agreed in 2003 to design and manufacture eight cranes for $13.2 million. The cranes are to be used in the vit plant’s High Level Waste Facility, where they will be remotely operated as they perform work with radioactive waste in hot cells. The waste, left from the past production of plutonium for the nation’s nuclear weapons program, will be treated for disposal at the plant.
But since 2003 the Department of Energy has had a “never-ending” increase in mandates that Bechtel passed on to suppliers without consideration of cost or schedule impacts, American Crane said in its legal complaint.
One of the major disruptions for American Crane was the shutdown of its work for more than two years starting in 2005 as Bechtel and DOE re-examined and re-set the design criteria for earthquake safety, the lawsuit said. Not only did the company have restart costs, but the design criteria for the cranes, the inspection procedures and the standards Bechtel set for accepting the cranes were drastically changed, according to American Crane.
An even larger driver of the cost increase was the continual ratcheting up of Bechtel’s interpretations of contractual, technical and regulatory requirements that American Crane believes have been unwarranted, according to the lawsuit.
Because the work to design and build the cranes spanned a decade, American Crane is left with substantial risk to its warranties, the lawsuit said. It expected manufacturing warranties for parts American Crane purchased, such as brakes, bearings and electrical drives, to expire before the cranes would be shipped to Bechtel, it said in 2013.
Bechtel had not filed documents outlining its defense when the lawsuit settled and declined to respond to allegations after the lawsuit was dismissed.