Federal judges affirm roughly $79-million judgment against Lane Construction, rejecting conflict claims tied to $2.3B Orlando P3 interstate megaproject finished in 2022.
Содержание:
A federal appeals court has upheld a lower court’s decision requiring The Lane Construction Corp. to pay roughly $79 million in damages, plus interest, to joint venture partners Skanska USA Civil Southeast and Granite Construction for work on Florida’s I-4 Ultimate highway megaproject in Orlando, which was completed in 2022.
In an opinion issued April 15, the U.S. Court of Appeals in Atlanta affirmed a lower court’s findings that Lane materially breached the joint venture agreement by refusing to meet capital calls, and that Skanska acted in the venture’s best interest in rejecting a legally risky strategy to exit the project.
The court rejected Lane’s claims that Skanska failed its fiduciary duties in managing the $2.3 billion public-private construction partnership.
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U.S. Court of Appeals for the Eleventh Circuit —
Opinion of the Court
“Not all ventures strike gold; some strike sinkholes,” the court wrote in its opening lines, describing a project that turned from a projected $255-million profit into losses exceeding $500 million amid “hurricanes, inflation, a labor shortage and a series of unfortunate events.”
The financial toll was compounded by a stark human one. Five workers lost their lives on the project between 2015 and 2019—each fatality involving a worker struck by equipment, materials or falling structural elements.
The ruling marks the latest—and possibly final—chapter in a dispute ENR has tracked since 2021, when Lane sued Skanska over management decisions tied to mounting losses on the highway project.
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Court Rejects Conflict Claim
At the center of the case is Lane’s claim that Skanska, as managing partner of the Skanska-Granite-Lane joint venture, acted under a conflict of interest because an affiliated Skanska entity held a stake in the project’s concessionaire, I-4 Mobility Partners. Lane argued that Skanska should have pursued a “termination request” strategy to force an exit from the project and limit losses. Skanska instead pushed to continue construction and negotiate relief with the Florida Dept. of Transportation.
The appeals court upheld the trial court’s conclusion that Skanska’s decision was justified. The lower court had found that choosing negotiation over termination “was a no-brainer, not a breach,” and the appellate panel agreed, concluding the record showed Skanska “acted in the best interest” of the joint venture.
The opinion also underscores that overlapping roles between contractors and concessionaires are common in P3 projects and, by themselves, do not establish a breach of fiduciary duty.
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Funding Dispute and Project Fallout
The court also affirmed that Lane’s refusal to fund its share of project costs constituted a material breach of contract. Lane stopped making capital contributions in early 2021 while litigation was pending, leaving Skanska and Granite Construction Co. to cover the shortfall to keep the project moving.
The district court ordered Lane to pay about $49 million to Skanska and $30 million to Granite—amounts the appeals court upheld—along with approximately $13.5 million in prejudgment interest and potential attorneys’ fees.
Rejecting Lane’s procedural arguments over how capital calls were issued, the court found the contractor’s nonpayment was unjustified. The appellate panel said it would be “unreasonable to deny” Skanska and Granite recovery over “some missing paperwork” that would not have changed Lane’s decision not to pay.
The dispute stems from the I-4 Ultimate project’s design-build-finance-operate-maintain structure, one of the largest P3 highway projects in the U.S. The 21-mile reconstruction through Orlando included 15 interchanges and roughly 140 bridges, delivered under a long-term concession in which private partners financed construction and assumed significant performance risk.
Traffic moves along an elevated segment of the I-4 Ultimate corridor in downtown Orlando during construction.
Image: Courtesy of Skanska USA
Under that structure, while the concessionaire bore contractual responsibility to the state, the contractor joint venture carried substantial exposure to cost overruns and delays—risks that escalated sharply as project conditions deteriorated.
The court detailed how the venture encountered major disruptions, including a massive sinkhole that added an estimated $48 million in costs and 245 days of delay, as well as broader labor and material pressures.
Legal analyses commissioned by the joint venture warned that pursuing a termination strategy was unlikely to succeed and could expose the contractors to uncapped liability. Attorneys at Holland & Knight concluded the approach “would be reckless,” while a second outside firm, identified in the opinion only by the initialis VLP, warned it could trigger “protracted litigation” and worsen the venture’s position.
Despite financial turmoil and internal disputes, the I-4 Ultimate project was completed at a cost closer to $3 billion, with long-term maintenance continuing under the concession agreement.
In an email, Skanska representatives declined to comment, citing ongoing litigation. ENR requested comments from Granite and Lane, but neither company immediately responded.
