Contractor URS Corp. and the state of Minnesota reached a $5 million settlement Friday in the state's lawsuit over the 2007 downtown Minneapolis bridge collapse that killed 13 people and injured 145 others.
URS had a long-standing contract with the Minnesota Department of Transportation to evaluate the structural integrity of the 40-year-old Interstate 35W bridge and recommend ways to shore it up before it fell. URS did not admit any liability or fault for the collapse, nor did the state.
In a statement, URS called the collapse a "tragedy," but said the company "was not involved in the design or building of the bridge, nor was it involved in any of the later construction work, including the resurfacing work being done when the bridge collapsed."
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URS and its insurers will pay $5 million under the mediated agreement. In exchange, URS will be released from future state claims connected to the collapse. The company's statement said the settlement allows it to avoid the cost and time of further litigation.
The agreement also says the state may use all or a portion of the money to pay for construction of a permanent memorial to the 35W bridge collapse victims or other charitable use.
"It's an appropriate thing to do," MnDOT spokesman Kevin Gutknecht said. "The whole collapse was a terrible tragedy and it seems appropriate that money from litigation such as this could be directed in that way."
Private fundraising for the proposed memorial has been slow, and spending the settlement on it would require legislative approval.
State law requires that any money collected from litigation or settlements go back into the general treasury so the state can recoup some of the $37 million it had set aside for a victims compensation fund.
The settlement still requires formal approval from Hennepin County District Judge Deborah Hedlund.
The state had alleged San Francisco-based URS breached its contracts and was negligent because it failed to discover the bridge's defects, including that some of the steel gusset plates that joined the bridge's beams together were only a half-inch thick instead of a full inch as they should have been.
Federal investigators ruled the weak plates were the critical factor in the collapse, though the weight of construction materials on the bridge deck was a contributing factor.
With the settlement, the state's only pending action is against Jacobs Engineering Group Inc., which acquired a now-defunct firm that designed the original 35W bridge.
URS still is the main defendant in scores of lawsuits by survivors of the collapse and families of the dead, who are not covered by Friday's settlement. Those cases are scheduled to go to trial before Hedlund in April 2011. The victims' lawsuits also name Jacobs Engineering.
Progressive Contractors Inc., which was resurfacing the span at the time, settled with about 130 victims and survivors last November. Hedlund, who approved that agreement, said the financial awards for victims would be kept confidential. PCI also agreed to pay $1 million to settle the state's claims.
The state didn't cut ties to URS after the collapse. The transportation agency entered into more than $6 million in contracts with the company in the two years after the incident, including one signed four days before the state sued. URS was hired to do more bridge work for the state.
The settlement also won't prevent URS from winning additional state work.
"MnDOT will treat URS just like it treats any other contractor or consultant that applies for business," Gutknecht said.
Attorneys for the victims decried the close ties.
"URS chose to pay its business partner, the state, to settle claims," said Philip Sieff, one of the lead attorneys in a consortium representing more than 100 victims.
Attorney Jim Schwebel, who represents some other victims, said they went into mediation in good faith a couple months ago without success.
"The bigger question is why would URS find it strategically meaningful to get the state out of the case and not the victims," Schwebel said. "My personal opinion is it has a lot to do with the close relationship between the state and URS, which has existed for many, many years."
Associated Press Writer Brian Bakst contributed to this report from St. Paul.
(Copyright 2010 by The Associated Press. All Rights Reserved.)