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Texas company files lawsuit over two-year-old contract dispute

Business owners in Houston, Texas, are aware that mediation and arbitration are often the more effective ways to settle a contract dispute. However, certain contract disputes demand that the case be litigated because of the irreparable damage that the dispute caused the two parties involved. A recent lawsuit filed in a Texas court by a chemical manufacturing company against another chemical company from Michigan centers around a manufacturing dispute began in 2013.

According to news reports, TM Chemicals Limited Partnership of Galveston County, Texas, has filed a lawsuit in its local court against SPE Wax Technologies LLC, a company based in Michigan. The lawsuit involves a dispute that began in 2013 when those two companies entered into an agreement to process tolls for certain products at TM Chemical's Texas laboratory by using the process and technology provided by SPE Wax.

The petition filed in court states that the two companies entered into the agreement, but, for unknown reasons, were unable to work out a cost-effective production plan. The petition also states that the two companies agreed to carry out production on a trial basis in order to better evaluate the plan, but were unable to come to an agreement over pricing during that trial period.

Because of the lack of information from SPE Wax, TM Chemicals was unwilling to proceed with production. Interestingly, the lawsuit also claims that despite TM Chemicals' apprehensions, SPE Wax tried to force production without a formal contract and reasonable pricing. Apparently, TM Chemical's first attempt at resolving the contract dispute was through mediation; the company had even offered a compromise, but SPE Wax refused to agree to the terms and suggested different terms, which TM Chemicals was unwilling to accept.

TM Chemicals now seeks a declaratory judgment against SPE Wax and declaratory relief for themselves. Additionally, TM Chemical seeks compensation of up to $100,000, pre- and post-judgment interest, legal fees, procedural expenses and other costs stemming from the lawsuit.

Source: The Southeast Texas Record, "Company seeks contract resolution," Carol Ostrow, April 17, 2015

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