Memphis Light, Gas and Water (MLGW) has initiated legal proceedings against Asplundh Tree Expert LLC, a former contractor tasked with tree trimming services around power lines, citing breaches of contract that reportedly impacted the region's power stability. The suit, lodged in federal court last Friday, aims to address what MLGW characterizes as a series of failures that led to power outages and financial losses for the utility provider.
With a stunning five-year, $97 million contract at the heart of this dispute, MLGW's agreement with Asplundh was abruptly severed in July 2023 due to concerns over inadequate performance. MLGW officials, including President and CEO Doug McGowen, described the lag in operations by revealing that, as opposed to the anticipated 14,000 miles of tree trimming over a decade, only approximately 8,200 miles were actually completed, falling short of expectations.
Going into the specifics, Action News 5 reports that Asplundh was nowhere near hitting their annual 1,400-mile tree trimming mark. In fact, it trimmed a paltry 26 miles in 2023 before MLGW called time on the contract. It's alleged that Asplundh's crews not only failed to meet schedule demands, but also saw diminished crew sizes each year and reportedly relocated some of their workforce to more lucrative contracts in other states. According to data in the lawsuit, this reassignment of resources by Asplundh is believed to have been a calculative move to maximize profits.
Subsequent to the contract termination, MLGW claims its costs for tree trimming services have soared. A statement from a lawsuit filed by MLGW, as cited by Local Memphis, outlines an example where the cost for a single period's cycle trimming work more than doubled from Asplundh's contractual obligation of about $15.6 million to over $31.9 million under new contractors—a staggering difference that exemplifies the utility's over $16 million loss for that year alone.
The company's response to the allegations remains curt. "We have no comment on this pending legal matter at this time," Asplundh conveyed through a statement. Meanwhile, as reported by FOX13 Memphis, MLGW is seeking damages that will be determined in a trial, looking to compensate for the supposed contract breach and the knock-on financial and service provision effects felt by the utility and its consumers. The utility provider also appears to be seeking punitive damages, as well as pre-and post-judgement interest.
