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American Shipper

Guam port asks court to dismiss crane suit

Guam port asks court to dismiss crane suit

The Port Authority of Guam has asked the island nation's Superior Court to dismiss a lawsuit by a former crane bidder that has stalled an effort to bring three refurbished gantry cranes to the island's commercial port.

   The Guam port authority responded to the filing Monday, asking the court to dismiss the lawsuit.

   Far East Equipment Co., the sole bidder for a port contract last year to bring new cranes to Guam, filed the lawsuit in late-February asking the court to prevent the Port Authority of Guam from taking any further action to facilitate the plan by Jones Act-carriers Matson Navigation and Horizon Lines. During the bidding process last year, Far East's bid was rejected due to what the port claimed were nonconformities in the bid.

   Far East, which submitted the rejected bid on behalf of Chinese crane manufacturer ZPMC, argued in the Superior Court filing that 'as the licensing agreement does involve the expenditure of government funds ' the Guam Procurement Law applies to the licensing agreement.'

   Port officials, in asking the court to dismiss the suit, claim that because Matson and Horizon are splitting the $15 million purchasing, refurbishment and installation costs of the three cranes, no public funds are being expended and thus the port's agreement with the carriers allowing the three cranes to be installed does not need to adhere to government bidding rules.

   The Guam commercial port operates two nearly 30-year-old gantry cranes that are increasingly prone to mechanical problems and a lack of available repair parts. The two ocean carriers believe there is a critical need for new cranes to prevent a backlog of material when the U.S. military begins shifting its operations on Okinawa, Japan to Guam in July 2010. Cargo volumes through the Guam port during and after the transfer are expected to rise by as much as six times.

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