A truck maker being sued by the city of Chicago for allegedly dumping a defective electric garbage truck on the city, is counter suing, claiming the city knew the truck was “experimental” and needed “real-world testing” to achieve perfection.
In February, City Hall filed suit in Cook County Circuit Court against Motiv Power Systems, asking the company to pay back more than $1.3 million for an all-electric trash truck the city bought in 2014, which the city said has been inoperative much of the time. The case was moved in March to U.S. District Court for the Northern District of Illinois.
“Parties agreed and understood that the development of the technology would require the real-world testing of experimental garbage trucks,” Motiv contended in its counterclaim.
City Hall, however, said Motiv waived its right to sue, and has asked the judge to dismiss the counterclaim.
Motiv is based in Foster City, Calif., which is near San Francisco.
The city bought the vehicle as part of its Chicago Climate Action Plan, to lower greenhouse gas emissions. A grant from the U.S. Department of Energy partially paid for the garbage truck, which the city trumpeted as the first such truck in North America. However, the vehicle has since been bedeviled with mechanical and software problems, the city alleged.
Motiv responded the suit should be tossed for several reasons, including the action was lodged after the statute of limitations expired. However, Motiv also hit back May 22 with its own claim against the city, alleging breach of contract. Motiv said the city knew from the get-go kinks would have to be worked out and four more trucks would be needed for full testing.
“Pursuant to the Contract, the parties intended a partnership through which Motiv would develop and the City would road test in real world conditions, the previously undeveloped technology associated with electric refuse trucks. The parties understood and agreed that the electric garbage trucks contemplated in the Contract were experimental,” Motiv alleged.
Motiv added followup models would “incorporate the lessons learned and the more mature technology would resolve performance issues.”
However, the city has not ordered the four other vehicles, as it had allegedly agreed to do.
“Motiv never would have entered into a contract for the purchase of one experimental garbage truck. To the contrary, Motiv and the City contracted specifically to test and develop the technology so that after five electric garbage trucks, Motiv would have sufficient experience with and knowledge of the application to perfect the technology,” Motiv argued.
As a consequence, Motiv has lost its position as market leader and the accompanying sales, because the city has washed its hands of the deal, according to the company. Further, Motiv was deprived of millions of dollars from sales of trucks to the city and expected profit from maintenance of the trucks.
On June 12, the city responded with a motion to dismiss Motiv’s claim. The city said that in the contract, Motiv waived its right to sue, instead agreeing to bring any disputes before the city's chief procurement officer for resolution, which Motiv did not do.
In addition, "nothing in the Contract obligated the City to purchase any set quantity of trucks," with the city reserving the right to buy how many it wished, according to the city.
Further, the contract does not obligate the city to pay for any trucks it did not order or of which it did not take delivery, the city said.
The city contended Motiv misconstrued the terms of the federal grant, to argue the city committed to purchasing five trucks.
U.S. District Judge Ronald Guzman is presiding over the case.
The city is represented by attorneys from its Department of Law.
Motiv is represented by Michael J. Summerhill and John T. Shapiro, of Freeborn & Peters, of Chicago.