Michigan’s two largest electric utilities, DTE Energy and Consumers Energy, have secured a major courtroom victory after a federal jury awarded them nearly $400 million in damages in a long-running lawsuit tied to a failed rebuild of the Ludington Pumped Storage Plant on Lake Michigan.
After a six-week trial in U.S. District Court, jurors sided with the utilities in their case against Toshiba and its subsidiary Toshiba America Energy Systems Corp., finding the contractor breached its obligations during a decade-long overhaul of the massive hydroelectric facility.
The jury awarded $383,136,736 in damages on Thursday, December 18, 2025. When previously assessed penalties, interest, and related damages cited in court filings and subsequent reporting are included, the total award climbs to approximately $394 million, with the overall financial exposure still expected to climb closer to $500 million as interest and additional costs accrue. The utilities had sought nearly $600 million, arguing the defective work left critical components cracked, leaking, and unable to operate at full capacity.
The case was heard in Flint before U.S. District Judge F. Kay Behm and centered on a 2010 contract to rebuild six turbine units buried deep beneath the lakeshore at the Ludington Pumped Storage Plant.
Attorneys for DTE and Consumers argued Toshiba’s work was riddled with defects, forcing parts of the plant to be limited to just 50 hours of operation per year. During trial testimony, jurors were shown video of water pouring through internal rooms, described by utility lawyers as a “waterfall” leak inside the facility.
Toshiba’s defense blamed design decisions and operating practices by the utilities, calling the damage self-inflicted and accusing the companies of using the contract as an insurance policy to cover wear and tear at the more than 50-year-old plant. Jurors rejected that argument, also ruling against Toshiba on counterclaims seeking more than $30 million in withheld payments.
Consumers Energy spokesperson Brian Wheeler, speaking on behalf of both utilities, said the verdict validates their position and reinforces their obligation to customers.
We hold ourselves and our contractors to the highest standards to do safe, dependable, on-time work that serves our customers, and feel validated the jury agreed Toshiba did not meet those standards. We will always go to bat for our customers.
Consumers Energy spokesperson Brian Wheeler
The Ludington facility, completed in 1973, acts as a giant energy battery, pumping water uphill when electricity is cheap and releasing it during peak demand to generate power. It accounts for roughly 10% of the generating capacity of both utilities.
Toshiba signaled the fight may not be over. Company officials said they are disappointed with the outcome and plan to continue addressing the matter through the judicial process, leaving the door open for appeals.
While the verdict represents a major financial win for DTE and Consumers, how much of the recovery ultimately benefits ratepayers remains unclear. Michigan regulators have temporarily allowed the utilities to sequester repair costs, delaying any decision on whether customers could be asked to absorb remaining expenses.
For now, the ruling marks one of the largest utility construction verdicts in Michigan history and a costly loss for one of the world’s largest power equipment manufacturers.
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