U.S. District Court finds Metso Paper USA in breach of its contract with First Quality Tissue SE, LLC.
ANDERSON, S.C., June 25, 2012 /PRNewswire/ -- On Wednesday June 20, 2012, the United States District Court for the District of South Carolina found that Metso Paper USA Inc. had breached its contract with First Quality Tissue SE, LLC when Metso sold a Through-Air-Dried (TAD) tissue machine to Clearwater Paper Corporation. The court determined that the provision of First Quality's contract with Metso restricting such sales for a limited period of time was enforceable, and that Metso had breached that provision.
The court explained that the contractual provision was enforceable because it "(1) furthers legitimate business interests held by [First Quality]; (2) is reasonable in its substantive, geographic, and temporal scopes; and (3) was knowingly entered by Metso with its eyes wide open." Rejecting all of Metso's arguments that its sale to Clearwater was permitted under the contract, the court concluded "Metso has breached the contract with [First Quality]."
Although the court declined to issue an order stopping the Clearwater sale, First Quality is pleased with the court's findings with respect to Metso. "Honoring contractual commitments is a core value of First Quality, and we expect the same of all of our business partners," said a spokesman for the company. "We feel the court vindicated First Quality's position."
About First Quality
First Quality Tissue SE, LLC is a member of the First Quality Group of Companies, a closely-held diversified group of companies manufacturing, selling and distributing branded and private label absorbent hygiene, paper and non-woven products into the healthcare, retail and commercial channels. Through its various affiliates, First Quality manufactures premium paper towel and bath tissue products on state-of-the-art Thru-Air-Dried machines. The company currently has two TAD machines operating in Lock Haven, Pennsylvania and one in Anderson, South Carolina; with a fourth machine starting up in Anderson by the end of 2012. First Quality is dedicated to meeting the demands of the market by providing innovative and high-quality products manufactured utilizing state of the art technology. For more information please visit www.firstquality.com.
SOURCE First Quality Tissue SE, LLCBack to top