A major Honolulu rail contractor is being sued by its former in-house counsel, who alleges he was fired after warning the company not to conduct “illegal activity” related to the multibillion-dollar transit project.
Bosko Petricevic worked at local construction firm Nan Inc. from March 18 to June 10, according to a lawsuit filed Wednesday in Hawaii state court. During his brief stint there, the suit alleges, Petricevic warned Nan’s president, Patrick Shin, not to “double dip” and charge both the city and Nan’s subcontractors for the same rail-related claims.
The suit, brought against a company by one of its own former lawyers, alleges that Nan violated the state’s whistleblower protection act. It comes amid a sweeping federal criminal investigation into rail that now threatens to extend into Honolulu Hale. The project’s original $5 billion budget nearly doubled, largely due to construction claims and change orders.
Petricevic’s whistleblower suit alleges that Nan engaged in multiple illegal practices, although they’re not all explicitly tied to rail. It also alleges the former company attorney endured verbal and even some physical abuse by top Nan officials.
The firm’s former attorney says he learned that several Nan employees were being interviewed by the FBI, but that when Petricevic expressed concern he was told by the company’s vice president to mind his own business. The suit does not specify why the FBI approached Nan employees.
Those problems have threatened to delay rail’s west side opening, slated for late 2020.
Shin made a claim against HART that the rail agency’s canopy designs were to blame while also telling Thompson that it did not follow the proper specs — a “inconsistent and dishonest” position, according to the suit.
Shin was not immediately available for comment Thursday morning.
Petricevic declined to comment through his attorney.
Nan currently has a $400 million contract to relocate utilities ahead of rail construction in town, and it’s also building six of the west side stations. The company’s contracts to build those stations were originally awarded for nearly $172 million total. Since then, delays and design snafus have helped increase those total station costs by nearly 13%, according to HART reports.
Nan also previously completed utility relocation work near the airport.
The suit alleges that Petricevic was threatened by Shin and others not to put the issues that he encountered in writing. However, when Petricevic finally did write an email in June outlining his complaints of a hostile work environment, he was fired, it says. The company, however, said he left voluntarily.
It seeks unspecified compensatory and punitive damages from Nan.
HART was hit with three federal grand jury subpoenas in February, just weeks before Petricevic started working at Nan. An unspecified number of agency employees later received individual subpoenas.
Earlier this week, Honolulu City Council members rejected a proposal for a private legal firm to provide legal counsel to city employees should federal authorities serve them with subpoenas or request interviews.
The city’s corporation counsel believes the investigation that has ensnared rail could soon move from HART to Honolulu Hale, but those in-house city attorneys say they lack the necessary expertise to advise on criminal matters, according to Ron Menor, who chairs the council’s Executive Matters and Legal Affairs committee.
In January, both the state and city auditors’ offices released a fresh batch of reports documenting HART’s mismanagement of rail in previous years, including what they found to be the agency’s lax handling of construction claims and change orders.
The city auditor’s most recent report found that improper management of change orders amounted to nearly half a billion dollars in added costs.
During a recent media tour of west side station construction, HART Project Director Sam Carnaggio said Nan was having difficulty building the canopies to the specifications of the design, which was created by AECOM. The two companies clashed over whether this was AECOM’s fault or Nan’s, Carnaggio said during the tour.
Rail board members, meanwhile, have approved up to $10 million to scrap existing canopy arm segments and build entirely new ones. They hope the move will keep the stations on schedule for the December 2020 opening of the first stretch of the line from the fields east of Kapolei to Aloha Stadium.
HART officials have said the agency isn’t responsible for the canopy snafus, however, and that they plan to eventually recoup those costs from the responsible parties.
Read the complaint here:
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