June 24, 2008
Boston ‘Big Dig’ Contractor in Bankruptcy
Modern Continental Corp., the largest contractor in a multi-billion-dollar Boston tunnel project has filed for Chapter 11 bankruptcy, court documents show.
he bankruptcy filing was submitted four days after the state filed 49 criminal charges against the company for shoddy workmanship, The Boston Globe reported Tuesday.Many expected and feared Modern would file for bankruptcy, which could allow it to pay pennies on the dollar on fines.
The Massachusetts Turnpike Authority has already withheld $20 million in payments to the company for unfinished work. Modern Continental, in turn, blamed the state for its financial difficulties.
As a result of Modern's struggle to collect due and owed contract balances from the Commonwealth, Modern's ability to timely fulfill its remaining contractual requirements Â has been placed in jeopardy, a company statement said.
Modern Continental has earned $3.2 billion for work on the Big Dig, a 3.5 mile tunnel under the city of Boston.
Relatives of Milena Del Valle, a motorist killed when the ceiling of the tunnel collapsed, also are suing the company, which filed for bankruptcy claiming debts of $1 billion, the newspaper said.