Hawaiian Electric Industries Inc.

EDITOR’s NOTE: If PUC finds HECO management negligent, ratepayers cannot be made to foot bill for rebuild.

News Release from Bottini & Bottini Inc. (bottinilaw.com)

On September 11, 2023, BOTTINI & BOTTINI, INC. and TAMASHIRO SOGI & BONNER filed the first lawsuit seeking to hold the Board of Directors of Hawaiian Electric liable for the tragic loss of life and property due to the Maui Fire on August 8, 2023.

The case -- Rice v. Celeste A. Connors et al., Case No. 1CCV-23-0001181, is pending in Honolulu, Hawaii in the First Circuit court.

The new complaint alleges that between 2019 and 2022, Hawaiian Electric invested less than $245,000 on wildfire-specific projects on the island. Instead of spending necessary funds to prevent fires caused by its equipment, Hawaiian Electric instead spent millions of dollars towards efforts to achieve a 100 percent renewable energy goal, which earned the Company bonuses that the Company’s executives used to increase their own compensation. Defendant Seu, CEO of the Company, was paid 32 times the median compensation of all employees in 2022.

The members of Hawaiian Electric’s Board of Directors were also well aware of the need to adopt and implement a power-shutoff system, as San Diego Gas & Electric and PG&E had done years before, but failed to do so. Darren Pai, a spokesperson for Hawaiian Electric, admitted that the Company did not have a formal power shutoff plan at the time of the Maui fire. The complaint also alleges that the Defendants new about the connection between passing hurricanes and wildfires. In 2020, researchers from the University of Hawaii and the East-West Center established a causal relationship between fires on Maui and O‘ahu to winds from Hurricane Lane.

The complaint alleges that the Defendants breached their fiduciary duties by causing Hawaiian Electric to haul away fallen poles, power lines, transformers, conductors and other equipment from near a Lahaina substation starting around Aug. 12, 2023, before investigators from the federal Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) arrived on scene. One of the attorneys for the shareholders, Addison Bonner of Tamashiro Sogi & Bonner, said: “The Defendants’ actions may have violated national guidelines on how utilities should handle and preserve evidence after a wildfire and deprived investigators the opportunity to view any poles or downed lines in an undisturbed condition before or after the fire started.”

Frank A. Bottini, of Bottini & Bottini, a co-counsel for the shareholders, said: “Rather than spend its customer’s money to improve infrastructure maintenance and safety, the Board of Directors of Hawaiian Electric funneled ratepayers’ money to boost their own profits and compensation. This pattern and practice of favoring profits over safety left Hawaiian Electric vulnerable to an increased risk of a catastrophic event such as the Maui fire, which was the worst natural disaster in Hawaii’s history and the deadliest U.S. fire in over a century.”

The complete complaint can be downloaded from the link below.

PDF: (2023-09-11) Conformed Verified Shareholder Derivative Complaint.pdf

SA: HEI board accused of skimping on safety