Federal judge finds former owner of mid-Michigan dams liable for nearly $120M in damages

A default judgment has been entered against the former owner of a mid-Michigan dam that failed in 2020, forcing the evacuation of more than 10,000 people and damaging thousands of homes and businesses.

The U.S. District Court for the Western District of Michigan on Monday awarded a $119.8 million judgment against Lee Mueller, whose business, Boyce Hydro, owned and operated the Edenville Dam. The Department of Attorney General filed the motion seeking judgment on behalf of the Michigan Department of Environment, Great Lakes, and Energy (EGLE) and the Department of Natural Resources (DNR), which filed the lawsuit about a month after the May 2020 disaster. 

“The dam’s ownership completely disregarded imminent threats to the safety and integrity of the dam, and as the State clearly demonstrated before the Court, Lee Meuller and his business were responsible for the disaster that struck Edenville and other area communities,” said Attorney General Dana Nessel. “This nearly $120 million judgment is important, both as a measure of accountability to the community Mueller devastated and as a deterrent to other owners of critical infrastructure.” 

The Edenville and Sanford dams both failed on the evening of May 19, 2020, during heavy rainfall. The subsequent flooding down the Titabawassee River caused two more dams upstream, the Smallwood and Secord dams, to also overflow. 

All four dams were owned by Boyce Hydro, which had its permit to generate hydro-power revoked in September 2018 by the Federal Energy Regulatory Commission (FERC), which had been preceded by more than a decade of safety and regulatory violations by the private company.

“The failures of the Edenville and Sanford Dams caused impacts that were devastating, but avoidable,” said Phil Roos, EGLE director. “The courts have rightly declared that owners of critical infrastructure must not put their own interests ahead of the safety of Michiganders, our environment, or our natural resources. EGLE remains committed to supporting the community through permitting replacement structures as it rebuilds.” 

Monday’s ruling follows previous judgments by the court in February, when Mueller himself was determined to be liable, and then in October when Boyce Hydro was also held to be responsible.

“Plaintiffs brought sufficient evidence to show that Defendants knew of its dam’s vulnerability and that Defendants did not make EGLE aware of that vulnerability,” ruled U.S. District Judge Paul Maloney in the October judgment. “Defendants do not dispute either assertion. Plaintiffs’ point to Mr. Mueller’s deposition when he acknowledged that Defendants knew the embankment might fail.”