If ever there were a lesson in allowing the justice system to work its way through issues that can be complex, it was delivered last Thursday in a Buffalo courtroom. There, a Supreme Court judge dismissed two more breach-of-contract claims filed by the Buffalo school district against LPCiminelli.
It was the second time a judge a threw out legal complaints against the Buffalo company. A different judge tossed two other claims the school district filed against the construction company. The district has appealed the decision and could do the same with last week’s ruling. But it should consider carefully before proceeding with either.
Not only did Judge Deborah A. Chimes throw out the two complaints on Thursday, but she ordered the district to pay $3.2 million plus interest to LPCiminelli. The lawsuit that was supposed to recover money for school district taxpayers is, instead, costing them money. An appeal could raise the price higher.
The lawsuits were instigated two years ago following allegations of excessive profits levied by former School Board member Carl Paladino, who is also a developer. In her ruling, Chimes said she found no evidence that LPCiminelli improperly hid information from the district or failed to properly rehabilitate 48 city schools. The district claimed the company had withheld that information to conceal excessive profits.
“It is … uncontested that the District’s architects certified that (LPCiminelli) properly completed the work,” Chimes wrote. “Moreover, the District has accepted the work in question” and “is occupying the renovated buildings and utilizing the schools.”
It’s important to note that this isn’t the only problem that has confronted LPCiminelli in recent years, and not even the most serious. In an unrelated matter, Louis P. Ciminelli and two other former employees of the firm were charged with federal felonies in connection with the company’s work at the RiverBend project in South Buffalo. Those charges remain pending though, as with the civil complaints, there is no telling at this point how they will be resolved. It is both wise and fair to wait and see.
The aftermath of the civil complaint that alleged profiteering by LPCiminelli remains murky. While a Buffalo News analysis of the school renovation project concluded that approximately $400 million of spending on the project was unaccounted for in public records, the company itself declines to reveal how much it profited, except to say through its lawyer that the amount was “nowhere near” that amount.
Indeed, there is a question whether the district needed to be concerned with the company’s profit margin. Unless that figure is somehow made part of the contract, then the district’s interest should be in its expense, which should be determined through a transparent bidding process by prospective vendors. The competition will control profits.
With at least one appeal pending, it’s too early to label these court rulings complete vindication for LPCiminelli, but they certainly move matters in that direction. Depending on the outcome, the questions that will have to be answered are: What process did the district follow before filing the lawsuit? And how much money did the decision to proceed cost taxpayers?