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Contractor starts lawsuit against state

Had state lawmakers agreed to pay LouAnne Berg’s construction company what she claims it lost on a veterans home contract, she said, she would have walked away happy.

Now that she is taking her fight to court, though, she also is out for attorney’s fees and related costs, she said Friday. Berg is the owner and chief executive officer of Hudson-based J&L Steel & Electrical Services, which recently initiated a lawsuit against state government and other parties involved in the construction of the Chippewa Falls Veterans Home.

Berg has contended the state owes J&L $217,499 after government officials’ forced the company to replace one type of nurse-call system it had planned to install at the veterans home with a more-expensive alternative. That amount, according to court documents, is the difference in price between the product J&L officials had wanted to use, one made by Chicago-based Jeron Electronic Systems Inc., and the one the company had to install, a Responder 4000 made by Mount Pleasant, Ill.-based Rauland-Borg Corp.

As a preliminary step to suing the state, Berg persuaded lawmakers to introduce a bill that would have awarded her company the $217,499. The legislation won approval in the state Senate but died in the Assembly, letting Berg take her claims to court.

Now, she said, she will not be satisfied if J&L is compensated merely for its losses on the veterans home. She estimated the fight against the state has racked up $40,000 in legal fees so far.

“And there will be more if we are going to Madison,” Berg said.

Jason Tarasek, the lawyer representing J&L, said he was surprised the company’s claim legislation even won approval in the Senate, “which, I think, speaks to the underlying merit of our claim.”

Calls to state officials and two of the companies named in the complaint, Madison-based Arnold & O’Sheridan Inc., and River Falls-based Frisbie Architects Inc., were not immediately returned Friday afternoon. Arnold & O’Sheridan was the engineering firm on the Chippewa Falls Veterans Home and Frisbie was the architecture firm.

The fourth defendant named is St. Paul, Minn.-based Communications Mid-America Inc., which sells Rauland Responder 4000 systems in Chippewa Falls and other parts of Wisconsin. J&L’s complaint alleges Communications Mid-America, months after the project contract had been awarded, improperly raised questions about J&L’s plans to use an alternative nurse-call system.

Those questions, J&L has contended in other court documents, directly led to the state’s insistence that J&L revert to using the Rauland Responder 4000.

Myron Anderson, chief financial officer for Communications Mid-America, said the confusion would have been avoided had J&L officials only read the contract specifications closely. He cited language that permitted the use of substitute systems only if the equipment had received state approval within 10 days of the bid date.

J&L did not obtain the required approval, Anderson said, and thus should not have been allowed to install anything but a Responder 4000. He said the 10-day requirement is important because it was meant to ensure all bidders could make use of the advantage that comes from including a cheaper system in a project proposal.

“That’s why we have a bidding process,” Anderson said. “It tells all the bidders what capability the state is looking for in the system.”

Berg and other J&L officials have said they solicited a quote from Communications Mid-America for the Chippewa Falls project but did not receive one.

“I don’t know if they asked for one,” Anderson said Friday. “I don’t know anything about that.”

Berg said she, in contrast to her lawyer, had hoped the dispute could have been settled out of court.

“It was so simple before,” she said. “Everyone we talked to was on our side.”

About Dan Shaw, [email protected]

Dan Shaw is the managing editor at the Wisconsin Law Journal. He can be reached at [email protected] or at 414-225-1807.

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