An insurance company is suing a metals recycler and its contractor, alleging it isn't responsible for settling a claim over an injured employee.

Great American E&S Insurance Co. filed the suit in U.S. District Court for the Southern Distinct of Mississippi against Alter Scrap Metal Inc., Alter Trading Inc., Precision Welding, Hartford Fire Insurance Co. and Harry A. Koch Co., another insurance provider.

Great American claims that the recycler and other parties were aware of...