CPA, 2 companies settle dispute over airport project

The Commonwealth Ports Authority and the two companies it sued in federal court over alleged design and engineering defects in a project known as West Addition at the Saipan International Airport have resolved the lawsuit.

CPA and the Chicago-based Boeing Company and the Texas corporation Boeing Service Company, through their respective counsels, informed the U.S. District Court for the NMI on Monday about their settlement.

With this development, CPA counsel Matthew Gregory and Boeing Company and Boeing Service Company counsel Sean Frink asked the court to dismiss the lawsuit.

In a joint report, Gregory and Frink stated that CPA and Boeing have resolved their dispute and the lawsuit may be dismissed.

The lawyers said CPA filed the lawsuit as a result of a series of problems related to additional terminal space and for other security improvements at the Saipan International Airport.

Boeing had contracted with CPA on the project. Boeing then subcontracted with others, including Leo A. Daly Co., which designed and managed construction for the project.

“The CPA’s lawsuit, while directed at Boeing (with whom CPA was in privity), solely related to defects in the design prepared by [Leo A. Daly Co.],” Gregory and Frink stated.

The lawyers said that after filing the lawsuit, CPA and Boeing reached an initial settlement, which had several conditions. One of that was that CPA presents the settlement for Superior Court’s approval, as part of a parallel case CPA had filed against Leo A. Daly Co., and that the Superior Court makes certain findings specified in the settlement deal.

Gregory and Frink said that, on June 20, 2014, the Superior Court entered an opinion and order on the CPA’s motion to approve the settlement.

The Superior Court agreed that the settlement was entered into in good faith, but declined to rule on certain other matters that were required by the settlement.

Gregory and Frink said the Superior Court’s opinion and order gave both parties options about how to proceed, which CPA and Boeing discussed in good faith. Ultimately, CPA and Boeing reached an amended settlement agreement.

Boeing informed Leo A. Daly Co. of the discussions and amended settlement agreement before it was executed. Leo A. Daly Co. was given a copy of the agreement.

CPA then filed a motion for a finding of good faith and approval of that settlement. The Superior Court granted CPA’s motion.

Gregory and Frink said Boeing’s lawsuit against Leo A. Daly Co., which is pending in federal court, will continue.

CPA sued Boeing for breach of contract. In the lawsuit, CPA asked the federal court to order the defendants to pay $1 million-plus for damages, courts costs, and attorney’s fees.