Quantum Chemical Co. filed a lawsuit May 28 to rescind the sale of its Heath, Ohio, plant to 3DM LLC. The lawsuit claims fraud as well as breach of contract. Quantum is seeking unspecified damages in addition to a cancellation of the sale.
The recycling plant, which grinds, cleans and repelletizes post-consumer plastics, is capable of producing 32 million pounds of reprocessed high density polyethylene per year. It opened in 1992 and employed 35. When it shut down last October, some employees were laid off while others transferred to the compounding facility next door.
Quantum, based in Cincin-nati, had been searching for a buyer for the plant when 3DM approached the firm earlier this year. After negotiations, the two parties drew up a purchase and sale agreement.
3DM, a newly formed firm now headquartered in Heath, bought the 50,000-square-foot recycling plant in March. Quantum's lawsuit alleges that 3DM's controller, Michael Meyers, agreed to pay $4.1 million for the plant.
At the sale closing, Quantum claims that 3DM agreed to make a down payment of $675,000 and wrote a check for $2,614 to cover closing costs. The check was returned unpaid and a wire transfer for the down payment was never received, according to the lawsuit.
Quantum's attorney, Mike Ferro, said 3DM apparently had problems financing the buy.
``There was no payment under the contract,'' Ferro said.
3DM, recently bought by Beachwood, Ohio-based Fix-Corp., planned to restaff the plant with people with significant experience in the plastics industry. That hiring did not involve Quantum employees, Ferro added.
Fix-Corp. officials said that, as part of its plan to make plastic pallets, equipment to install two presses has been ordered, with another press due to be installed in 18 months. Mark Fixler, chairman and chief executive officer, said at the time Fix-Corp. announced the 3DM deal that production of plastic pellets could be phased out.
Neither Meyers nor Fixler could be reached last week for comment.
Ferro would not say what the company's plans would be, if it were to gain the rights to the plant again.
``We're handling one thing at a time,'' he said.