On Tuesday, November 13, 2018, Mayor Tim Keller held a press conference to announce the city’s plans to cancel the manufacturing contract with Build Your Dreams (BYD).
The city wants to return all the 60-foot electric buses manufactured and delivered for the disastrous ART Bus Project.
During the November 13, 2018 press conference, Mayor Keller revealed that the city hired the services of a respected private Albuquerque law firm to represent the city in the dispute with the bus manufacturer.
A “registered mail” demand letter dated November 13, 2018, the same day as the press conference, was sent by the private attorneys and not from the City Attorney’s Office.
The letter demanded that BYD take possession of the buses and the chargers by November 30, 2018.
The demand letter also put BYD on notice that the city intends to seek “damages, costs, attorney fees and any relief to which it is legally entitled to” under the giving BYD notice that the city intends to sue.
You can read the demand letter here:
During a November 1, 2018 press conference, Mayor Keller outlined the numerous problems with the buses reported.
The problems include:
1. The center and rear brakes had zero air pressure, yet the 60-foot-long articulated buses were able to move, meaning that the center and rear axle brakes were not working and the buses were relying on their front brakes alone.
2. Rear doors would open during bus operation without any action by the driver.
3. The buses have air conditioning outages.
4. Bolts flying off doors
5. The electric buses do not have the required range on a full battery charge and the bus manufacturer still has not provided the extra charging stations. 6. The lack of undercarriage protection.
7. Buses that wouldn’t stop when emergency doors were utilized.
8. Cracking on bus exteriors.
9. Mirrors not set up correctly.
10. Wiring problems and electrical system problems.
11. The handicap electric chair lock becoming unsecured when the driver turns on the air conditioner.
The deficiencies with the brakes, batteries and doors were reported as “fleet-wide issues” that posed such significant safety concerns that the city could not allow any member of the public to ride on the buses to avoid the risk of injury.
During the November 1, 2018 press conference update, Keller pronounced the new ART Buses as “unsafe at any speed” and said:
“We are not going to let these buses on our streets until we are 100 percent sure they’re safe. … And what the tests found is that, today, several of them are not. We’re testing the buses through an inspection process and we want to make sure nobody gets hurt either riding these buses or driving these buses. … I’m running out of patience with [BYD].”
Keller ordered the grounding all the buses until each one had a full safety inspection.
For further media reports see:
NOVEMBER 13, 2018 KELLER PRESS CONFERENCE
The biggest problems associated with the electric ART buses relate to the bus batteries.
The electric buses delivered are supposed to operate for 275 miles, but city officials found the buses cannot go more than 177 miles before they need recharging.
The batteries are stacked in a metal shelf and when overheated could cause a fire.
Keller during his November 13, 2018 press conference elaborated on the problems with the bus batteries by saying:
“We believe there’s not even close to adequate fire protection [when it comes to the bus batteries]. Right now, it would vent right in the middle of the bus and we would not be able to pull those out. They’re already heating up so they can’t take a charge. They’re not properly [stored] or cooled. … We’re no longer going to be guinea pigs [for BYD] anymore … Obviously, we very concerned about what we’ve been put through as a city by BYD … I think down the road, we’re interested in being fairly compensated for what we have been misled on these buses.”
BYD also has failed to construct additional charging stations on the Central Avenue route promised as part of an agreement with the city some months ago to address the problem with battery life.
Lawrence Rael, the city’s Chief Operating Officer, had this to say about the effort to cancel the bus contract:
“The mechanical pieces and issues we now find with the operation of the equipment are part of a long series of missed deadlines and missed issues with a company that I think have driven us to the point where we are today.”
BYD RESPONDS TO MAYOR TIM KELLER
After Mayor Keller’s November 13, 2018 press conference, BYD President Stella Li issued a statement vehemently denying the accusations made by Mayor Tim Keller.
Any experienced trial attorney would anticipate the response.
BYD announced in a statement the hiring of “independent transportation experts” to evaluate the buses and prove they are safe and ready for use and stated:
“We fully expect that these independent, unbiased inspections will conclusively demonstrate that our buses are built to the highest standards and capable of fulfilling the purpose that they were purchased for, … An independent investigation will prove to the world that we have been misrepresented.”
BYD further accused Keller of slander and bad faith by stating:
“Keller’s media statements slander and maliciously harm the reputation and good name of BYD, … These statements show that the city is not acting in good faith under the contract and further indicate a potential political agenda to discredit and throttle a public works project that the mayor has long criticized as part of his campaign platform. … [Albuquerque] City hall’s actions have not only wrongfully damaged BYD’s reputation, but also have deprived the citizens of Albuquerque of the world’s safest and most advanced pollution- and cost-reducing zero-emission transit bus. BYD will take all appropriate legal actions to protect itself in light of City Hall’s conduct.”
INSPECTOR GENERAL’S REPORT
On June 6, 2018, the city of Albuquerque’s Inspector General (IG) issued a report on the ART Bus Project.
The entire Inspector General report can be read here:
According to the Inspector General report, former Chief Operations Officer Michael Riordan “was adamant about having a bus transported to the City before the end of the Mayor Berry administration.”
An Albuquerque transit employee told the Inspector General that “core processes on manufacturing buses was altered to ensure delivery of the first bus by the deadline.”
The IG report described two city employees interviewed who recounted a “tense” and “unusual” phone call between then-city Chief Operating Officer Michael Riordan and top executives from the manufacturer.
According to the IG’s report the first bus delivered in August 2017, was assembled by the manufacturer using a “frame intended for buses being built for [another city’s transit authority].”
Frames intended for the Albuquerque’s buses had not yet been shipped nor received by the manufacturer.
The Inspector General found that the bus manufacturer used “parts and pieces” intended for another city’s buses for the first ART bus delivered.
The city employee further reported that the first bus was moved to whatever assembly station was available to ensure it was assembled in time in order to get it shipped to Albuquerque before Mayor Berry left office.
COMMENTARY AND ANALYSIS
“Truth” is always an affirmative defense preventing recovery when it comes to any cause of action for libel and slander, but defending against such accusations in contract disputes can be costly.
“Client control” over any elected public official by their attorneys is always very difficult and tenuous at best, just ask Donald Trump’s lawyers.
The City Attorney’s office should have anticipated BYD’s reaction and now the city needs to brace for costly litigation.
BDY’s accusation that the ART Bus project is a public works project that the Mayor Keller has long criticized as part of his campaign platform is downright false and could not be further from the truth.
During his year and a half quest to become Mayor of Albuquerque, Tim Keller never called upon his predecessor to stop the ART Bus project, nor to cancel the bus contract nor did he ever condemn it as destroying historical Route 66.
Tim Keller did not attend a single public hearing or meetings held by the Berry Administration on the project, including the meetings hosted by city councilors.
After becoming Mayor on December 1, 2018, Keller has wasted the first year of his 4-year term trying to save the project by giving BYD the benefit of the doubt in their ability to deliver the buses.
From day one of being Mayor, Keller has said that too much has been spent on the project and it would be too costly to reverse the project.
When 15 new buses were delivered, the Keller administration took possession and did not return them and only now trying to cancel the contract.
Keller’s November 13, 2018 press conference should never had happened, but it did nonetheless, and it aggravated matters for the worse all because of Keller’s penchant for press conferences, social media communications and his efforts to try and salvage a project the taxpayers have never really wanted.
Keller used the demand letter as a “political prop” holding it up during the press conference knowing full well he would be photographed with it with Keller knowing it was mailed the same day.
Sure enough, on November 17, 2018, a color picture of Keller was on the front page of the printed Albuquerque Journal holding up a copy of the letter above the fold with a headline reading “BYD defends buses, rips criticisms; ART bus maker wants independent inspection, threatens legal action”.
The private attorneys Mayor Keller hired to represent the city in the dispute were not present at the November 13, 2018 press conference.
What is significant to note is that City Attorney Esteban Aguilar and Chief Administrative Officer (CAO) Sarita Nair, both who have experience as attorneys in private practice, did not participate in the November 13, 2018 Keller press conference.
The City Attorney’s office employees over 30 full time attorneys, it has at least one attorney assigned to Municipal Affairs or the Transit Department that oversaw the ART Bus project, yet Keller felt compelled to hire private attorneys to handle the dispute with no explanation given as to why.
Keller probably felt hiring private attorneys was necessary given the overall reputation of the City Attorney’s Office of settling cases too quickly, not defending cases adequately and the reluctance for the City Attorney’s office to go to trial.
Good examples of the City Attorney’s Office quickly settling cases include the $61 million paid out in settlements in police misconduct and deadly use of force cases over the last 9 years.
Both Aguilar and Nair should have told Mayor Tim Keller not to go forward with his press conference assuming they knew about it, because it is obvious from the content of the demand letter the city intends to initiate litigation.
The absence of the private attorneys hired by Keller, the City Attorney and the CAO makes one wonder if any of the attorneys were even invited to the press conference by Mayor Keller or if he sought their legal advice or counsel on whether the press conference was a good idea in the first place.
Keller violated the cardinal rule with his press conference that should never be broken by anyone who has hired an attorney.
When you hire an attorney, you keep your mouth shut so as not to complicate things, make matters worse with damaging “out of court statements” or admissions against your own interest that can be used against you in a court of law.
Once you hire an attorney, you must let your attorneys do all the talking, both in civil and criminal law matters, and you do not hold a press conference before an opposing party has had the opportunity to respond to demands being made by you in a written demand letter.
The November 13, 2018 Keller press conferences on the ART Bus project was nothing more than grand standing as well as invitation for a counterclaim for damages seeing as the bus manufacture had not even responded to the demand letter.
I suspect the bus manufacturer will now sue first or at the minimum, file a counterclaim against the city.
A silver lining to the likelihood of a lawsuit filed by BDY as a first strike or a counterclaim is that former Mayor Richard Berry, former Chief Operations Officer Michael Riordan and former Transit Director Bruce Rizzeri will probably have to be named “necessary and proper partys” in that all 3 were involved with the selection of BDY and there is a need to determine what was represented to them, what they agreed to and what was expected of BYD.
The June 6, 2018, Albuquerque Inspector General (IG) report on the ART Bus Project makes it likely that Berry, Riordan and Rizzieri will be named party defendants.
As party defendants, the depositions of all 3 would be in order to find out what representations were made to them by BYD or what threats may have been made by them as city officials to get the busses up and running before Berry left office.
Just maybe, just maybe, Berry, Reardon and Rizzieri will be held accountable for the $135 million boondoggle and the cramming the Bus Art project down the throats of taxpayers without a public vote.
In the meantime, Mayor Keller needs to stop his periodic press conference status reports on the ART Bus project, stop making public comments on the project as the dispute winds its way through settlement discussions or the courts.
For a related blog article see “Civil Lawsuit On ART No Substitute For Criminal Investigation On Whole Project” at the below link: