Judge upholds $383M verdict against Toshiba over faulty hydro plant overhaul

Overview

Updated 1 hour ago

A federal judge has upheld a $383 million jury verdict against Toshiba America Energy Systems for defective overhaul work at the Ludington Pumped Storage Plant in Michigan. The plant, co-owned by Consumers Energy and DTE Electric, is one of the world's largest pumped-storage facilities, and some of its turbines could only run about 50 hours per year after the work.

The verdict is the largest civil jury award in Michigan history. Toshiba may appeal, and the utilities are spending more than $500 million on repairs that could eventually affect customer rates.

Why it matters

If the verdict survives appeal, Toshiba's payment could offset repair costs that might otherwise land on Michigan utility customers' bills.

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Key Indicators

$383M

Jury verdict affirmed by judge

Damages awarded for Toshiba's breach of warranty, plus $11.3M in liquidated damages for late work.

$560M

Original overhaul contract

Contract awarded to Toshiba in 2010 to restore the 50-year-old plant to near-new condition.

$790M

Projected total repair costs

Utilities' estimate of what fixing the defective work will cost, including the $508M already spent.

Hours per year affected turbines could run

Some pump-turbines were limited to about 50 hours of operation annually after the defective overhaul.

Voices

Curated perspectives — historical figures and your fellow readers.

Ever wondered what historical figures would say about today's headlines?

People Involved

F. Kay Behm

U.S. District Judge, Eastern District of Michigan

Presided over the trial and affirmed the verdict on September 28, 2026

Brian Wheeler

Consumers Energy spokesperson

Spoke on behalf of both utilities after the verdict

Organizations Involved

Toshiba America Energy Systems

Energy equipment subsidiary

Defendant; contract terminated by utilities in 2024

American subsidiary of Japan's Toshiba Corporation that contracted to overhaul the Ludington plant in 2010.

Consumers Energy

Electric utility

Co-owner of Ludington plant and plaintiff

Michigan's largest electric utility and co-owner of the Ludington plant, which provides 10% of its generating capacity.

DTE Electric

Electric utility

Co-owner of Ludington plant and plaintiff

Michigan utility and co-owner of the Ludington plant, which provides 10% of its generating capacity.

Voith Hydro

Hydroelectric equipment manufacturer

Repair contractor at Ludington

German-owned hydroelectric equipment maker hired to repair the Ludington plant after the Toshiba contract was terminated.

Jenner & Block

Law firm

Represented the utilities in the lawsuit

Law firm that secured what it calls the largest civil jury verdict in Michigan history for Consumers Energy and DTE Electric.

Timeline

2010 October 2026

9 events Latest: Today

Tap a bar to jump to that date

October 2026
Engineering News-Record reports the affirmation
Today Report

ENR publishes its account of Judge Behm's September 28 order upholding the $383M verdict.
Today
September 2026
Judge Behm affirms verdict, denies new trial
Legal

Judge rejects Toshiba's motions to overturn the verdict, finding the award not legally excessive and jurors not biased.
September 28th, 2026
December 2025
Jury awards $383M to utilities
Legal

After a six-week trial, the jury finds Toshiba breached warranties and awards $383.1M plus $11.3M in liquidated damages.
December 18th, 2025
2024
Utilities terminate Toshiba contract
Contract

Consumers Energy and DTE end the Toshiba contract and hire Voith Hydro for repairs worth more than $400 million.
2024
2023
Michigan regulators allow repair cost tracking
Regulatory

Michigan Public Service Commission lets the utilities track repair costs for potential reimbursement later.
2023
2022
Utilities file lawsuit against Toshiba
Legal

Consumers Energy and DTE Electric sue Toshiba America Energy Systems and Toshiba Corporation in federal court in Flint.
2022
2019
Defects found in discharge rings on two units
Discovery

Cracks discovered in discharge rings and extensions on Units 2 and 4, limiting some turbines to about 50 hours of operation per year.
2019
2015
Overhaul work begins at Ludington plant
Construction

Toshiba begins work on six pump-turbines buried five stories underground near the Lake Michigan shore.
2015
2010
Utilities award $560M overhaul contract to Toshiba
Contract

Consumers Energy and DTE Electric hire Toshiba to restore the 50-year-old Ludington plant to near-new condition.
2010

Scenarios

Toshiba appeals to Sixth Circuit, verdict upheld

Likely Resolves by Q2 2028

Discussed by: Legal analysts and the utilities' counsel at Jenner & Block

Toshiba has grounds to appeal the September 28 order denying its motion for a new trial. The Sixth Circuit would review whether jury instructions were proper and whether the damages award was excessive. The utilities argue the award is supported by evidence of defective work, including the removal of stainless-steel overlays and unsuitable metal in discharge ring extensions.

Toshiba settles for reduced amount

Possible Resolves by End of 2027

Discussed by: Court watchers noting the cost and risk of appeal

Toshiba could negotiate a settlement to avoid years of appellate litigation and the risk of a larger award with interest. The utilities have already spent more than $500 million on repairs and may accept a negotiated payment to resolve the dispute and move forward with the plant's restoration.

Sixth Circuit reverses or remands verdict

Unlikely Resolves by Q2 2028

Discussed by: Toshiba's legal team

Toshiba argued the verdict was legally excessive and that Michigan utility customers serving as jurors had a financial interest in the outcome. Judge Behm rejected both arguments, but the Sixth Circuit could take a different view on appeal, potentially ordering a new trial or reducing the award.

Historical Context

2 moments from history that rhyme with this story — and how they unfolded.

December 2005

Taum Sauk pumped storage failure (2005)

On December 14, 2005, the upper reservoir dam at the Taum Sauk pumped storage plant in Missouri breached, releasing 1.5 billion gallons of water down the mountain. The plant, owned by AmerenUE, had been operating with faulty water-level sensors that failed to stop the pumps.

Then

The breach destroyed the reservoir and flooded Johnson's Shut-Ins State Park. No one died, but the plant was shut down for years.

Now

The plant was rebuilt and reopened in 2010 with redundant safety systems. The failure became a case study in pumped storage infrastructure risk.

Why this matters now

Like Ludington, Taum Sauk was a pumped storage facility where infrastructure failure had major consequences for the owner and the public.

2010-2013

San Onofre steam generator replacement (2012)

Southern California Edison replaced the steam generators at the San Onofre nuclear plant in 2010-2011. Within months, premature tube degradation forced the plant to shut down, and it was permanently retired in 2013.

Then

The plant never reopened, and ratepayers absorbed billions in costs for the failed replacement.

Now

The failure highlighted the risks of major component replacement at aging power plants and led to a $77 million settlement with federal regulators.

Why this matters now

San Onofre shows what happens when replacement equipment at a large power plant fails — the costs and shutdowns can be enormous, much like the Ludington overhaul.