Hawaiian Electric (HE.N) expressed approval on Tuesday following a ruling by the Hawaii Supreme Court, which moves the utility company closer to finalizing a $4 billion settlement related to the 2023 Maui wildfires. The company deemed the decision favorable, as it clears the way for the settlement process to proceed.
The state’s highest court had issued a ruling the previous day, siding against insurance companies. The ruling stipulates that, once the settlement is finalized, insurers will be barred from suing parties held responsible for the wildfires.
Following the decision, shares of Hawaiian Electric saw a notable increase, rising 6.2% in premarket trading.
Scott Seu, CEO of Hawaiian Electric, commented on the ruling, stating, “The decision helps move the settlement forward while providing more clarity for our company’s path toward reestablishing our financial stability.”
The devastating wildfires in Maui, which struck in August 2023, ravaged the historic town of Lahaina, claiming more than 100 lives. In response, Hawaiian Electric had already agreed to pay approximately half of the $4 billion settlement last year to compensate victims of the deadly fires.
The lawsuits filed on behalf of thousands of homeowners and business owners accuse the company of negligence, alleging it failed to shut down power lines despite warnings that high winds could bring them down and ignite wildfires.
Analysts from Jefferies noted that while the court’s decision is a positive outcome for Hawaiian Electric, further legislative clarity on handling future wildfires is needed for the company’s stock to see significant growth.
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