Embassy builder sues State Department for $461M

An Alabama-based construction company sued the State Department on Wednesday over accusations it refused to pay for pandemic-era cost overruns at a dozen embassy and consulate projects during the pandemic.

BL Harbert International says the government had agreed to a settlement until political appointees under Secretary of State Marco Rubio inserted themselves into the process.

“And, on information and belief, the Government’s decision to renege on this heavily negotiated agreement with a long-trusted construction partner of the Department of State came from the top,” the lawsuit states.

The suit, filed in the Court of Federal Claims, seeks at least $461 million in damages.

The Hill has reached out to a State Department spokesperson for comment.

BL Harbert’s case concerns a dozen projects spread across the globe.

The company demands reimbursement for its construction of new embassies in Turkey, Guatemala, Montenegro, Namibia and Honduras as well as four consulates in Morocco, Thailand, Iraq and four in Mexico.

BL Harbert says the government had directed the company to continue work when the COVID-19 pandemic shut down normal life in 2020, driving up costs, and the State Department told it to submit adjustments.

Eventually, the government agreed in September 2025 to pay the company $370 million to settle the cost overruns, court documents show, and an initial payment of nearly $502,000 was made.

But BL Harbert says the Trump administration is now walking away from its deal.

It comes after The New York Times reported this summer that Sergio Gor, the U.S. ambassador to India, separately terminated the company’s work on a new embassy in New Delhi. Gor told the outlet that President Trump had personally approved the cancellation and it would save hundreds of millions of dollars.

“We did not want to take this step. The U.S. Government is an important partner, and we are proud of the work we do together to advance America’s interests and protect Americans serving overseas,” Charles Bohn, the company’s president, said in a statement.

“But we have a responsibility to our employees and to the future of that mission. We kept our commitment under extraordinarily difficult conditions. We are asking the government to keep its commitment to us.”