One of the big topics on the KHON2 Pocast “What’s the Law” with Coralie Chun Matayoshi, is the Maui Wildfires Settlement. Here is a recap of her latest edition.
One and a half years after the devastating Maui wildfire that destroyed Lahaina and claimed 102 lives, victims are still struggling to rebuild. Investigators determined that downed power lines from Hawaiian Electric Company (HECO), combined with dry overgrown grass and hurricane-force winds, caused the fire to reignite and rapidly spread. In the aftermath, over 650 lawsuits were filed against HECO, landowners, the State of Hawaii, Maui County, and others.
In a significant legal milestone, all defendants agreed to a $4 billion global settlement to resolve all claims—without admitting fault. This settlement, impacting over 17,000 victims, avoids lengthy trials and potential appeals while providing certainty for both plaintiffs and defendants. As a former CEO of the American Red Cross, I know how critical it is for disaster victims to regain stability as quickly as possible.
However, before finalizing the settlement, key legal issues needed resolution—particularly whether insurance companies, which were not part of the agreement, could pursue claims against those responsible for the fires. Under the legal principle of subrogation, insurers can seek reimbursement from at-fault parties after paying out claims.
Maui Circuit Court Judge Peter Cahill intervened, barring insurers from filing separate lawsuits and requesting a ruling from the Hawaii Supreme Court. The decision carried major financial consequences: if insurers were allowed to sue, the settlement could collapse, potentially pushing HECO into bankruptcy. If barred, insurers might raise premiums or exit the Hawaii market.
In a swift and unanimous ruling, the Hawaii Supreme Court upheld Judge Cahill’s order, preventing insurers from pursuing separate claims. With this ruling, the settlement can now move forward, providing financial relief to wildfire victims.
For more legal insights, tune in to What’s the Law? https://www.khon2.com/whats-the-law/