goochy:
As well described in the previous responses an MH soil is unsuitable for use as a compacted fill behind a segmental block wall. Unfortunately, many contractors will use whatever soil is available, and usually the cheapest [free if possible] for backfilling purposes. The primary issue with these [most] contractors who build these walls is their virtually total lack of understanding regarding the mechanism involved with a geogrid reinforced block wall. At best, they may have seen the block manufacturers' handout which, unfortunately, only typically applies to one scenario, and if is never the scenario the contractor is involved with. Nevertheless, he will blithely apply the manufacturers' "design" to his project and then wonders why it fails.
Not only will MH soils absorb water, they are unlikely to compact well, and they tend to act as a plastic or quasi plastic material and do not "grip" the geogrid reinforcing layers well. Review of teh filed compaction records should preovide some insight regarding the condition of the material when it was placed and compacted. My estimate is that it was on the wet side of optimum, probably by several points.
Another issue is the elimination of any drain system behind the compacted fil mass. If no effort is made to intercept, collect, transport and dispose of any seepage or infiltrating moisture then hydrostatic pressure can build up and act on the compacted fill mass. Simply another load condition that is often missed, particularly by contractors.
The type of block, and possibly the software used for design [precuming software was used] can also have a detrimental impact on the geogrid used. An inappropriate geogrid material, and there are some of those out there, can result in an inadequate interaction between the geogrid and the soil and this can lead to pullout failure. In my experience, when attempting to determine the most appropriate [read economical or cheap] geogrid the computed pullout resistance is almost always low. This has to be carefully evaluated to make sure that a "failure" is not built into the original design. Believe me, this happens all the time.
Lastly, was the contractor "experienced" in block wall construction? Many who say they are in reality are not. The level of expertise is quickly determined when visting the site to observe the walls' construction. Watching the contractors' staff roll out the geogrid parallel to the back of the wall so that the machine direction is incorrectly located results in a wall that is inadequately reinforced, even if the contractor chose the correct geogrid.
Hope these comments help.