May 25, 2023: Christopher Haskell, a partner of Price, Postel & Parma LLP, recently settled a complex water pipeline rupture case that resulted in a multimillion-dollar recovery for the Firm’s client, San Luis Obispo County Flood Control and Water Conservation District. San Luis Obispo County Flood Control and Water Conservation District is the owner and operator of the Nacimiento Water pipeline. The pipeline is intended to supply the water demands in San Luis Obispo County for a period of at least 75 years. The project consists of an intake facility at Lake Nacimiento, three pump stations, three storage tanks, a control system, and approximately 45 miles of pipeline, including six horizontal directional drilling (“HDD”) river crossings.

Defendant A. Teichert & Son, Inc. dba Teichert Construction was the general contractor for two of the six HDD river crossings. In June 2014 leaks were discovered at the first HDD river crossing constructed by Teichert. As that lawsuit between the District and Teichert was being settled, leaks were discovered at the 2nd HDD river crossing. Plaintiff undertook the necessary repairs to the pipeline, and then filed a new lawsuit against Teichert for the 2nd HDD river crossing.

Plaintiff alleged Teichert breached its contract with the District, including various express warranties and guarantees, and negligently installed the HDD pipe. Specifically, plaintiff contended that installation stresses comprised the integrity of the HDD pipe, causing the leaks. Teichert alleged the leaks were caused by either design and/or manufacturing flaws, which led to premature corrosion and ruptures in the HDD pipe. Teichert filed cross-complaints for indemnity against the pipe manufacturer (Northwest Pipe Company), and the HDD subcontractors (the HDD company and the Rockford Corporation). After three separate days of mediation, Defendant Teichert and the Cross-Defendants agreed to pay plaintiff $4.7 million.

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