Contractor Sues Illinois Tollway After $324M Contract Abruptly Canceled

A $324 million Illinois Tollway project is on hold until at least August while the agency dukes it out in court with a contractor.

In November 2023, the Illinois Tollway awarded a nearly $324 million contract to reconstruct and reconfigure the southbound side of the I-290/I-88 Interchange on the Central Tri-State Tollway to Judlau Contracting. It would have been Judlau’s 21^st project performed for the Illinois Tollway since it began operating in the Chicago area in 2014.

Judlau Contracting has alleged in court filings that, on May 16, the Illinois Tollway “purported to terminate the Contract on contract-based grounds in a two-sentence letter.” The contractor then filed a lawsuit May 21 saying the agency breached the contract by “abruptly and improperly terminating the contract.”

“After repeated efforts to engage the Tollway on their abrupt decision were rebuffed, regrettably, we were forced to take this action to protect ourselves, our subcontractors, Illinois taxpayers and motorists,” said Arnav Amin, executive vice president, Judlau Contracting Inc.

Judlau Contracting is the heavy civil construction division of OHLA USA, which is itself a division of international construction company OHLA Group, headquartered in Madrid, Spain.

The Illinois Tollway provided the following statement to Equipment World on July 24:

“The Illinois Tollway prioritizes the safety of its customers, operational efficiency, and delivering projects on time – and our history demonstrates our ability to do so.

“While a final determination on the I-290/I-88 Interchange project is worked out, it is important to note that construction is continuing on other portions of I-290/I-88, and tremendous progress is being made as we continue to deliver the benefits of congestion relief and increase access through our interchange work.

“As the Tollway has done throughout its history, we will ensure that the work is completed, with the safety of our customers continually at the forefront.

“At this time we have no additional comments due to pending litigation.”

Errors Made in Bidding Process

In June, a DuPage County Court blocked the Tollway from awarding the same contract to another contractor who had also bid on the project in 2023.

A representative for Judlau Contracting told Equipment World that a preliminary injunction hearing scheduled in July had been pushed to August. 26-27 and that temporary restraining order “remains in effect until then.”

“In granting Judlau’s request for a temporary restraining order on June 20, the Court found that Judlau’s right to participate in a fair and open competitive bidding process was threatened with immediate and irreparable harm,” said Judlau Contracting in a statement.

Part of the disagreement stems from the Illinois Tollway’s own admission that it made errors during the bidding process, specifically that it was required to apply a 4% reduction to Illinois contractors that submitted bids and, had it done so, would have awarded the contract to a different company.

A description of the error is contained within a court filing from the Illinois Tollway and reads as follows:

"As explained in the Foernssler Affidavit, Tollway bid review staff misunderstood the mandatory character of the 4% bid preference set forth in Section 45-105(e), as it is unlike other long-standing bid preferences, such as the preferences for Corn Based Plastics, Small Businesses or Environmentally Preferrable Supplies. As a result, although Walsh qualified for the Illinois business bid preference, the Tollway failed to allocate a 4% bid preference to Walsh’s bid when evaluating the bids it received in response to the solicitation for the Contract. Had the Tollway applied the bid preference to Walsh’s bid, Walsh’s net bid would have been $313,916,132.50, the Tollway would have identified Walsh as the apparent low bidder, and the Tollway would have sought to award the Contract to Walsh."

Judlau contends in its filings and statements the delay in construction will impact the 300,000 daily drivers whp use the exchange.

In court documents, Judlau listed the following as work already done on the project:

• assembling local crews and employees to self-perform a significant amount of contract work
• mobilizing labor, equipment, materials, manpower to site
• approving 17 local subcontractors and suppliers, including Disadvantaged Business Enterprises (“DBEs”), whose contracts have now also presumably been abruptly terminated, jeopardizing the economic viability of local trade businesses, including material suppliers who were dependent upon the Project and the livelihoods of their workers and employees
• beginning the approval of more than 140 additional subcontractors and suppliers who will also presumably no longer be moving forward with work on the Project, resulting in economic harm to them and their local employees
• procuring performance and payment bonds as well as insurance
• beginning work in earnest, including developing the Project’s baseline schedule, participating in on-site construction meetings, performing extensive physical work including demolition of major structures (e.g., bridges and overpasses), extensive excavating and earthwork in preparation for new footings and foundations, grading of roadways, erecting safety barriers, instituting water management mechanisms to control for drainage pending further construction, and implementing traffic maintenance staging to account for demolition and other construction work.