Con Ed says the city and Texas-based Team Industrial Services were negligent in maintaining sewer and water lines.

Queens Councilman Eric Gioia, an outspoken critic of the utility, called the legal action audacious.

GIOIA: I think what you have here is a company that for a long time that has been unaccountable, has overcharged consumers and whenever there's been a mistake, they've tried to avoid responsibility at all costs.

REPORTER: Con Ed issued a statement saying that "there are many legal issues that have arisen from this incident and this is part of that process."

Con Ed itself is facing more than 40 lawsuits from people who were either hurt or lost business as a result of the steam blast.