UI resists Modern Piping’s attempt to arbitrate claim to attorney fees

The UI in May paid the Cedar Rapids construction firm millions to settle its years-long dispute. Now, the UI’s resisting Modern Piping’s efforts to arbitrate its claim to be paid $3.125 million in damages incurred during the legal battle.


Lily Smith

The Stead Family Children’s Hospital is seen on on Saturday, Sept. 23, 2017. (Lily Smith/The Daily Iowan)

Marissa Payne, Editor-in-Chief

After the University of Iowa in May paid a Cedar Rapids contractor millions it owed to settle a years-long court battle, the UI on June 26 resisted the firm’s motion to initiate arbitration to recover $3.125 million in attorney fees.

The UI asked the 6th District Court not to act on construction firm Modern Piping’s May 24 notice that the company was “in the process of initiating arbitration.” 

In the court filings, the UI argued it is unclear whether Modern Piping seeks to compel arbitration to be compensated for fighting the univeristy’s 2016 injunction to prevent an arbitration panel from considering the dispute over work on Hancher Auditorium and the UI Stead Family Children’s Hospital. 

RELATED: Iowa appeals court rules against UI argument in Modern Piping dispute

The appellate court in January ruled against the UI’s argument that the American Arbitration Association did not have jurisdiction to arbitrate the dispute, backing the 6th District Court’s previous ruling.  

That dispute spanned years, until the appellate court in April affirmed another 6th District Court ruling ordering the UI pay the arbitration award of around $21.5 million for both construction projects. The UI paid the final $13.5 million of the court-ordered sum it owed Modern Piping on May 15.

Modern Piping said it would not ask the court to compel arbitration to be paid $3.125 million in damages incurred while fighting the injunction but argued its claim to recover such fees is subject to arbitration because the parties entered into an enforceable arbitration agreement.

Previous court rulings — including those by the appellate court — “establish the parties agreed to arbitrate ‘any claim, dispute, or other matter … referred to the design professional,” Heery International, Modern Piping argued in the May 24 court filings.

RELATED: University of Iowa pays Modern Piping for Children’s Hospital dispute

A May 30 email included in the filings shows Heery Managing Director Scott Hansche wrote in an email to Modern Piping attorney Jeff Stone that Heery does not have jurisdiction in this matter. 

“The reason we are unable to make a recommendation is that we were not involved in the issues that took place between the owner and Modern Piping,” Hansche wrote.

State Board of Regents spokesman Josh Lehman said the regents have no comment. The UI and Modern Piping could not be immediately reached for comment.