Hawaii, Utilities Reach $4 Billion Wildfire Settlement Deal

The Facts of the Cases

The global settlement seeks to resolve the legal claims of approximately 2,200 people who filed suits after wildfires on Maui destroyed the town of Lahaina, claiming over 100 lives. The wildfire damaged approximately 2,170 acres of land on Maui.

Hundreds of lawsuits are included in the settlement. While their parties and topics vary, each case deals with damage caused by the Maui wildfire.

One such included claim is a case filed by the owner of 20 acres of land on Maui; the owner accused the county of piling wildfire debris on the property. Another case, filed by a Maui County family, alleged negligence, premises liability, private and public nuisance, trespass, and inverse condemnation against Charter Communications and its Spectrum Oceanic LLC subsidiary. The case claimed that Charter failed to prevent the fire from spreading, despite playing a role in the fire’s ignition. That case was later remanded to state court.

A third lawsuit is a shareholder derivative lawsuit filed against Hawaiian Electric. In it, shareholders alleged that Hawaiian Electric’s leadership failed to mitigate wildfire risks, despite knowing that Maui was at risk of severe weather events that made it more prone to wildfires that could stem from electrical equipment. Despite this knowledge, the lawsuit alleges, Hawaiian Electric’s leadership did not “adequately maintain” equipment and had “inadequate” safety procedures.

The Terms of the Deal

The $4 billion deal includes all tort claims filed against seven defendants: the state of Hawaii, Maui County, Hawaiian Electric, Kamehameha Schools, West Maui Land Co., Hawaiian Telecom, and Spectrum/Charter Communications. Under its terms, these defendants will pay a collective $4.037 billion to compensate claims arising from the August 8, 2023 wildfires, according to a press release from the office of Hawaii governor Josh Green..

The state of Hawaii will contribute to the $4 billion settlement in addition to its $65 million contribution to the One ‘Ohana Fund. The One ‘Ohana Fund, also known as the Maui Wildfires Compensation Program, offers assistance to those injured by the wildfires and to the families of those who died in the fires.

The deal “will give fair justice to the people of Lahaina,” said co-liaison counsel for plaintiffs Jesse Creed, an attorney with Panish Shea Ravipudi LLP. Creed noted, however, that additional lawsuits continue against insurance companies who did not participate in the settlement.

Attorney Michael Purpura of Hueston Hennigan, representing Hawaii, called the agreement a “historic settlement that will help move the state forward and help compensate survivors and their families following this unprecedented disaster.”

Not all attorneys involved in the wildfire cases, however, were as optimistic about the terms of the settlement. Maui attorney Gilbert Keith-Agaran, who represents several victims and families, called the amount of the settlement “woefully short.” Keith-Agaran noted, however, that families did need to consider the deal seriously, as Hawaiian Electric’s limited assets and risk of bankruptcy made it unlikely that the utility could bring more to the table.

Takeaways for Attorneys

The $4 billion settlement represents a significant step forward in the wake of the wildfires, yet it is not a complete answer. “We know for a fact that [the settlement is] not going to make up for what [Maui families] lost,” Maui attorney Jake Lowenthal told the Associated Press.

For the victims, the settlement is not the only compensation route available. Claims against various insurance companies are ongoing for several survivors and families. The terms of the $4 billion settlement also explicitly state that insurers may not attempt to recoup amounts already paid from those who receive payments from the $4 billion settlement.

Large settlements like these, involving several defendants and considering insurers that refuse to participate, take significant effort and attention to detail to forge. This settlement, which finished just a year after the wildfires, represents an impressive balancing act on the part of the attorneys involved in the case. Lawyers and law firms managed to balance rigorous representation of clients’ rights with the good-faith willingness to negotiate required to reach such a complex agreement. Their efforts speak well of the process and the future of Maui.