Money Talks: Class Action filed against MBTA and Keolis

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Money Talks

Yesterday, artfully timed to help celebrate “Rider Appreciation Day“, a class action suit was filed against the MBTA and Keolis:

Monthly pass holders have filed a lawsuit against the MBTA and Keolis over “substandard commuter rail service” this winter.

The suit was filed on Wednesday but announced on Friday, which the MBTA had designated as “Customer Appreciation Day,” offering free rides and deals at local businesses as a goodwill gesture following a winter of disastrous breakdowns.

The text of the lawsuit makes interesting reading. The plaintifs claim (on behalf of each person who bought a monthly pass in January, February, and March):

• Breach of Contract (Against the MBTA)
• Unjust Enrichment (Against the MBTA)
• Breach of Contract (Against Keolis)
• Unjust Enrichment (Against Keolis)

The action notes that “The average monthly commuter rail pass is $251.60” and “Upon information and belief, there are thousands of monthly commuter rail pass holders for any given month (including January, February and March 2015).” That means we’re talking about $1.5M — not a lot of money, but not chump-change either.

The action further observes that “The 15% off of May monthly passes potentially gives money away to persons unaffected by the Defendant’s breach”. Ouch. That one’s going to leave a mark.

The action also alleges (emphasis original):

YEARS OF MBTA MISMANAGEMENT AND A CULTURE OF INDIFFERENCE ARE THE REASONS THE DEFENDANTS BREACHED THE CONTRACTS WITH PLAINTIFF AND THE PUTATIVE PLAINTIFFS — NOT THE WEATHER

It is finally said, formally and on the record.

In support of that allegation, the action observes:

60. Another example of ineffective spending by the MBTA was reported in the Boston Globe days before the first snow storm hit. See Globe story, attached as EXHIBIT C. The Globe story details how the MBTA spent $224 million on forty (40) locomotives that were delivered in an unusable condition. As of January, 2015, only two (2) of the forty (40) locomotives were in service. The Globe story also references the $144 million the MBTA paid to a South Korean company for seventy-five (75) passenger cars that were delivered thirty (30) months late and “so trouble-prone [that] many of their parts… had to be replaced.” Perhaps if the MBTA had purchased working locomotives these locomotives would have worked during the winter months.

Again — Ouch. Another mark.

It will be hard to cover this story without talking about hundreds of millions of dollars spent on junk, while millions of dollars were collected from riders and pocketed.

“Investigations”, “panels”, and press releases are all very well and good. A lawsuit like this (and there is no assurance that this will be the only one), because it demands real money now, is a different kettle of fish.

Money Talks