HONOLULU (KHON2) — The latest Maui wildfire lawsuit involving Hawaiian Electric puts the blame on the company’s board of directors. The lawsuit says board members knew the risks for years about the possibility of a catastrophic wildfire, and didn’t do enough to prevent it.
The lawsuit was filed by a shareholder who claims that the board of directors did not fulfill their fiduciary duty by not spending enough money on safety.
The lawsuit says, “Hawaiian Electric’s directors caused the company to spend its capital on ‘green energy’ initiatives that earned the company millions of dollars in bonuses, which the Individual Defendants used to increase their executive compensation and directors’ fees.”
“Between 2019 and 2022, the records we’ve seen indicate that only $245,000, less than $245,000 was spent by Hawaiian Electric on the island of Maui to mitigate that risk,” said Addison Bonner, attorney for the shareholder.
Legal experts say it’s a bit unusual to file the lawsuits against board members, especially from a big company like Hawaiian Electric. Doug Chin said it also makes it harder to prove that board member did not act in the best interest of the shareholders.
“If there is evidence that starts coming out as the civil lawsuit plays out that shows officers and directors weren’t following the fiduciary duties, then there might be some exposure for them,” said Chin.
“We’ve got Hawaiian Electric’s regulatory filings with the government that show they knew about this risk for years, and yet very little was spent to actually mitigate it, and now the worst case scenario happened,” said Bonner.
Bonner added that the company’s stock price has dropped 70% since the fires. But he says the lawsuit is not just about money.
“This is about change, that’s what we’re concerned about here. It’s already been horrible, worse wildfire in US history, we gotta mitigate this risk so it never happens again in the future. That’s what this lawsuit is about,” he said.
We reached out to some of the board members and have not heard back. Hawaiian Electric declined to comment.