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Amerimex Recycling prevails in suit against PPG Industries

Keywords: Tags  Amerimex Recycling, PPG Industries, metal recycling, steel drums, breach of contract suit, Lisa Gordon

Pittsburgh — Amerimex Recycling LLC has won a breach-of-contract lawsuit against PPG Industries Inc., which it had accused of wrongly terminating a scrap metal contract.

The Lake Charles, La.-recycler, which filed the lawsuit in 2007, is entitled to $319,255.

"Nothing in its pleadings or reports to the court filed before trial suggested that PPG ever considered poor performance to be the cause behind termination of the Amerimex contract," Kathleen Kay, a magistrate judge in a U.S. District Court in Louisiana, noted in her opinion.

In 2005, the two parties entered a contract for Amerimex to purchase No. 2 heavy melting scrap (HMS) and crushed drums from PPG. The price to be paid to PPG was based on 65 percent of an AMM price for No. 2 HMS, Houston. The drums were to be sold at $20 a gross ton.

The contract was to run from Aug. 22, 2005, through July 31, 2008.

Amerimex said that it was standard practice to remove large piles of scrap from Pittsburgh-based PPG and separate the high-value metals at its facility.

Amerimex alleged that when a new manager took over the PPG scrapyard, he accused Amerimex of stealing the nonferrous scrap that was in the HMS pile. The manager alerted PPG security who informed Amerimex to return the load and leave the facility.

Amerimex said it was at this point its contract was terminated. The company that replaced Amerimex removed 8.2 million pounds of scrap during the remainder of the contract and was paid $549,680.

The judge noted that PPG had opted for a fixed date on the contract and was bound to live up to its obligation. Termination without reason and at will is not an option. The contract did state that the scrapyard should be cleaned to the ground, according to the decision.

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