(Reuters) -Hawaiian Electric’s shares jumped more than 40% on Monday after the utility said its power lines in West Maui had been shut down for more than six hours before wildfires started in the area during the afternoon.
The company’s shares were trading at $13.55, after at least two trading halts since the markets opened on Monday. The stock has lost more than half its value since the Aug. 8 wildfires.
Hawaiian Electric said the lawsuit filed against it by the county of Maui was “factually and legally irresponsible,” pointing to the county’s responsibility in the Hawaii wildfires.
The county of Maui last week sued Hawaiian Electric, accusing the utility of acting negligently by failing to shut down its equipment despite warnings that hurricane winds could knock power lines down, sparking wildfires.
The county said downed power lines started the wildfires that destroyed the historic town of Lahaina earlier this month, killing at least 115 people and displacing hundreds more.
Hawaiian Electric said on Monday that a morning fire on Aug. 8 caused by power lines that fell in high winds was subsequently reported “100% contained” and later declared “extinguished” by the Maui County Fire Department.
The utility said another afternoon fire started in the same area more than six hours after all of its power lines in West Maui had been de-energized, which could not be contained by the fire department and spread out of control toward Lahaina.
“We were surprised and disappointed that the County of Maui rushed to court even before completing its own investigation,” said Shelee Kimura, president and CEO of Hawaiian Electric.
The lawsuit alleging negligence was “particularly troublesome,” Wells Fargo analyst Jonathan Reeder said on Friday, adding that the brokerage viewed the lawsuit as an attempt to shift blame rather than sticking to an earlier narrative that it was a weather-induced tragedy.
(Reporting by Deep Vakil and Arunima Kumar in Bengaluru, Editing by Louise Heavens, Mark Potter and Shounak Dasgupta)
