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Amid Budget Austerity, MTA Battles Costly Lawsuit by Former Contractor

Tuesday, February 02, 2010

The MTA is waging a costly legal battle against former contractor Lockheed Martin, which was hired to provide an anti-terror system. A spokesman says the authority has spent or authorized $3.6 million on the case so far and it is still a year or two away from trial. The expense comes at a time the MTA is cutting back service.

Just by means of comparison, the $3.6 million that they are spending on this lawsuit would be enough to save the M train, which is slated to disappear this summer or save 10 bus lines that the MTA is planning to cut.

But from the MTA’s perspective, the legal bills are well worth it. The MTA stands to gain $90 million if it prevails in the lawsuit, while it could lose $140 million.

Lockheed Martin sued to get out of the contract last April, saying the MTA wasn't giving the company access to train tunnels where it was supposed to install cameras and other devices. The MTA counter-sued, claiming Lockheed's equipment repeatedly failed tests and the company didn't get approval for the system design as the contract required.

A big cost for the MTA will be for another company it hired to help with the lawsuit. That company will search through millions of records, including hundreds of thousands of e-mails, in the MTA’s computer system in order to find evidence for the case. A trial is still a year or more away and legal costs could grow.

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