Minnesota court clears way for lawsuit against Jacobs

Jacobs had attempted to block the lawsuit as time-barred but yesterday’s ruling allows the claim to proceed.

Statutes passed following the collapse allow the US state to seek reimbursement, the court found. The court said that the reimbursement provision of the compensation statutes does not violate the appellant’s constitutional right to due process.

In yesterday’s Supreme Court opinion, Justice Christopher Dietzen explained the background to the case, which arises out of the 1 August 2007 collapse of the Interstate 35W Bridge where it crosses the Mississippi River in Minneapolis, Minnesota. Following the collapse, individual plaintiffs commenced lawsuits for negligence, breach of contract and resulting damages against URS Corporation and Progressive Contractors, Inc. (PCI), which had performed work on the bridge under contracts entered into with the state. URS and PCI then brought third-party complaints against Jacobs Engineering Group, on the basis that Jacobs’ predecessor negligently designed the bridge. PCI also filed a third-party complaint against the state. 

The state cross-claimed against Jacobs for contribution, indemnity, and statutory reimbursement. Jacobs moved to dismiss the State’s cross-claim as time-barred, arguing that amendments to statutes could not revive actions against Jacobs that had been previously extinguished by a prior version of the statute of repose.  The district court denied the motion, and the court of appeals affirmed. The Supreme Court has now affirmed the court of appeals.  

In October 1962, Sverdrup & Parcel and Associates, Inc. had entered into a contract with the State to prepare design and construction plans for the bridge, explained Dietzen. Sverdrup certified the final design and construction plans in March 1965, and construction was substantially completed in 1967. Between 1966 and 1999, Sverdrup went through a series of name changes and mergers. In September 1999, Sverdrup Corporation merged with Jacobs, and Jacobs was the surviving corporation.   

In 2003, the State entered into a series of contracts with URS to conduct an inspection of the bridge to determine the nature and scope of maintenance that was needed. In March 2007, the State hired PCI to perform maintenance. The bridge’s collapse in August resulted in the deaths of 13 people and injuries to 145 others. 

In 2008, the legislature passed the compensation statutes to compensate survivor-claimants of the collapse.  Subsequently, the state entered into settlement agreements with 179 survivor-claimants who made statutory claims for compensation, paying them US$36,640,000 through the compensation statutes, and US$398,984 from an emergency relief fund created by the state in November 2007.  The compensation statutes provide, among other things, that the state may seek reimbursement from third parties for these payments, to the extent the third party caused or contributed to the bridge collapse. 
Individual plaintiffs commenced lawsuits for negligence, breach of contract, and resulting damages against URS and PCI. The district court consolidated the individual plaintiffs’ cases for pretrial purposes and dismissed the plaintiffs’ breach of contract claims. URS and PCI then brought third-party complaints against Jacobs for contribution and indemnity on the basis that Sverdrup negligently designed the bridge. PCI also filed a third-party complaint against the state.  The state cross-claimed against Jacobs for common law contribution and indemnity, contractual contribution and indemnity, and statutory reimbursement to recover funds the state paid to individual survivor-claimants pursuant to the emergency relief fund and the compensation statutes.  

In the consolidated proceeding, Jacobs moved to dismiss the state’s cross-claims against it. After a hearing, the district court denied Jacobs’ motion to dismiss.  Jacobs sought review of the district court’s decision in the court of appeals.  In a published opinion, the court of appeals affirmed the district court’s denial of the motion to dismiss.

The Supreme Court’s full ruling can be read at www.mncourts.gov