Arena Lawsuit

KNOXVILLE, Tenn. — A settlement has been reached in the long-standing lawsuits arising from construction of the University of Tennessee’s 24,535-seat Thompson-Boling Arena, UT Executive Vice President Emerson Fly announced Wednesday.

Fly said that under the agreement UT could receive at least $6.5 million in the settlement and that all claims against UT by B.B. Andersen Construction Company Inc., the original contractor, and its bonding company, United States Fidelity and Guaranty Company, will be dismissed.

”UT will receive sufficient funds from the settlement to pay for what the university spent to complete construction of the arena,” Fly said.

”In accordance with the original intent related to construction of the arena, other than $7 million in bonds from the state, no other UT educational or state funds have been spent on the project.”

The litigation began in 1985 when Andersen sued UT, its architects and Ross Bryan Engineers, the design team, for $4 million. USF&G then sued UT for another $2 million. UT counter-sued for approximately $7 million in compensatory damages.

”USF&G will pay UT $4.3 million over a three-year period or $4 million cash now,” Fly said. ”In return, UT will dismiss its lawsuit and claims against USF&G.”

In addition to the $4.3 million, USF&G also has agreed to pay UT the first $1.5 million received in litigation with other parties, Fly said. UT could receive in excess of $1.5 million, he said.

UT already has received $1 million from CNA Insurance Company, which insured the design team.

Andersen failed to complete the arena project, and another contractor, Ray Bell Construction Company of Brentwood, finished the work two years later.

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