Kauai Dam Breach Tragedy Still Not Resolved 7 Years After 7 People Were Killed

BY MALIA ZIMMERMAN – There was devastating decision in 1997 that started with illegal grading around a Kauai dam that led to the main spillway being covered, resulting in a tragic breach nearly a decade later that left seven people dead. The man who the state attorney general said is responsible for the breach was supposed appear in court today, seven years to the day after the breach, to end the years of drama surrounding the criminal case with an admission of guilt.

In a sweet deal that lawyers familiar with the case called “highly unusual”, Vince Kanemoto, the deputy attorney general overseeing the criminal manslaughter and reckless endangerment case against land owner James Pflueger offered him a chance to plead guilty today in Kauai’s Fifth Circuit Court to a single reckless endangerment felony charge, while his company that owns the property where the Ka Loko dam and reservoir sit would plead guilty to the seven counts of manslaughter.

However, the 86-year-old Pflueger pushed for – and was granted – another delay in court proceedings. His new “change of plea” date in court is now April 18.

For the families of the seven victims who hoped for a resolution today, the extension, one of many delays Pflueger secured through a well-funded team of lawyers, is just another painful reminder of what happened just before dawn on Tuesday, March 14, 2006.

The Ka Loko dam in Kilauea breached violently snatching the lives of seven people living along the Wailapa River and Kahili Beach on Kauai’s north shore. Witnesses reported the powerful waves reached as high as 40 feet and swept Aurora Solveig Fehring, her husband Alan Gareth Dingwall, and their 2-year-old son Rowan Grey Makana Fehring-Dingwall to their death.

The roaring, raging wall of water killed five others including Christina Michelle McNees, and her unborn child, and Daniel Jay Arroyo, her fiancé, who she was set to marry just hours later. Timothy Wendell Noonan, Jr., a friend who Aurora’s, and Wayne Carl Rotstein, the Fehring’s caretaker and business partner, also died.

The breach originated on property owned by Pflueger and his family’s Mary Lucas Trust. Witnesses said a “tsunami from the mountain”, which emerged out of the swollen 30-acre Ka Loko reservoir, collected trees, cars and debris in its path before crashing into the homes below.

After witnesses said Pflueger had knowingly covered the dam’s spillway during illegal grading to prepare it for home sites despite warnings from people who observed his actions, the state attorney general launched a criminal investigation that led to Pflueger’s indictment in November 2008.

Pflueger is the founder of the successful Pflueger Auto dealership and heir to considerable trust funds that include extensive lands on Kauai and Oahu, and he used those assets to finance an elaborate team of lawyers to delay his criminal trial for several years through multiple appeals on technicalities.

Pflueger Awaits Fate in A Second Legal Case

Besides the state manslaughter case, Pflueger is awaiting a verdict in a federal criminal case in which he is accused of tax fraud. On March 20, U.S. District Judge Leslie Kobayashi will announce her decision on his innocence or guilt on two counts.

In a 2010 indictment, the IRS accused Pflueger of using the dealership to pay personal expenses. Pflueger sold the dealership to his son Charles Alan Pflueger in 2001, but continued to have the dealership pay for his personal expenses and those of family members and friends, the IRS said.

Pflueger also is accused of hiding nearly $15 million from the sale of a property he owned in California called the Hacienda Corporate Plaza and sending the proceeds to a bank account located in Switzerland without properly reporting to the IRS the taxes on the sale or the transfer of the money.

Federal prosecutors claimed Pflueger and his accountant, Dennis Duban, manipulated the property transaction to avoid paying $4.5 million in taxes and hid the money overseas.

Duban testified Pflueger knew he would need to “generate significant funds” for his defense in the Ka Loko case including payments to lawyers, experts and engineers – and he would also potentially need millions of dollars more to pay a legal settlement in the Ka Loko civil wrongful death and property damage case. Pflueger was personally worth more than $71 million in 2007 (not including the $15 million the Swiss bank account), however most of the money was tied up in land, his accountant testified. Duban said in court Pflueger wanted to “protect his assets” and money from the families suing him over the Ka Loko Dam breach.

James Pflueger’s son, Charles Alan Pflueger, as well as his assistant Julie Ann Kam and his Chief Financial Officer Randall Ken Kurata and Duban were indicted on tax fraud charges in 2010, along with James Pflueger, however they pled guilty to reduced charges and are awaiting sentencing.

Pflueger already has been convicted on 10 felony counts for the 2001 illegally grading at his Pilaa beachfront property. More than 1,000 tons of mud went into the pristine Pilaa Bay just a few miles from Ka Loko property, destroying the reef. The mudslide impacted homes and property owned by the Marvin family. Federal and state agencies sealed Pflueger’s conviction in the Pilaa case just days before the Ka Loko dam breached in 2006.

Pflueger Blames Others for Legal Woes 

For both the manslaughter and tax fraud cases, Pflueger has maintained his innocence and has pointed to others to take the blame.

In the manslaughter case, Pflueger blamed Tom Hitch, manager of the private system that directed water from the reservoir to farmers in Kilauea, for improper maintenance. Pflueger also accused the state of negligence because no inspectors had come to inspect his dam, even though state law mandates checks by state Department of Land and Natural Resources personnel every 5 years.

But Hitch, who became a key witness against Pflueger in the criminal case, told Hawaii Reporter Pflueger had banned him from the Ka Loko property.

“Pflueger says the flood was caused by my not maintaining the dam, but he had locked me and all Kilauea Irrigation personnel out of the reservoir and dam for about 8 years prior to the breach. Pflueger personally told me he would ‘skin me alive’ if he ever caught me on his property without his permission,” Hitch said.

Hitch also disclosed he had made numerous complaints to the county of Kauai about Pflueger’s illegal grading around the dam to no avail.

Peter Young, director of the state Department of Land and Natural Resources at the time of the breach, showed documentation to Hawaii Reporter detailing the many times the state had contacted Pflueger to arrange inspections with no affirmative response from him.

In the tax fraud case, Pflueger did not testify in his own defense, but his extensive team of lawyers from Oahu and California claimed Pflueger’s accountant Dennis Duban and the accountants at the Pflueger auto dealership are responsible for the tax fraud. The defense team maintained that Pflueger was a big picture businessman too busy and too unsophisticated to read his tax returns and financial statements line by line. The defense team also claimed that someone had forged Pflueger’s signature on his tax returns and other relevant documents and he was defrauded by his own accountant, Dennis Duban.

Those involved with the manslaughter case believe if Pflueger is found innocent in the federal tax fraud case, he will be emboldened to continue to fight the state manslaughter charges as fiercely as he has since a Kauai grand jury indicted him on a rainy day in November 2008.

While all the drama surrounds Pflueger’s legal trials, the families of the seven victims await justice and closure on the criminal case and a nearly $4 million settlement from Pflueger for the civil case – a settlement that is more than a year overdue.

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