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Muted celebration after breach-of-contract lawsuit win

At this time of year, the bright yellows and reds in the fall foliage on the drive north from Milford can be stunning. Some business owners in Grafton County, New Hampshire, aren’t celebrating the colors or even their recent legal victory in court.

Though a jury awarded them nearly $3.8 million in their breach of contract lawsuit, the owners say the verdict has come too late to save the 122-year-old commercial laundry operation or the 125 jobs lost.

The Kleen commercial laundry, with its roots dating back to 1897, shuttered in early summer. While the $3,785,000 verdict following a four-day trial is sizable, most, or maybe all, will be handed over to bankers and creditors owed money after the company’s 2017 bankruptcy.

Kleen’s owners had filed a lawsuit against a compressed natural gas equipment installer that they said failed to deliver promised services. The natural gas equipment was intended to power Kleen’s Lebanon commercial laundry facility. The failure “contributed significantly” to the company’s June shutdown, the owners said.

“It is unfortunate for our business and our former employees that these breaches occurred in 2017, and that we were unable to bring this suit to a conclusion while it would have been possible to save the business and the jobs,” a co-owner said.

A spokesperson for Xpress Natural Gas said the private company is “disappointed in the jury’s verdict and plans to appeal.”

Back in 2016, Kleen and Xpress agreed that the gas equipment installer would convert the Lebanon facility from liquid natural gas to a compressed natural gas system.

According to the lawsuit, Xpress would install the system, supply liquid natural gas to Kleen during the installation from February of 2017 to June 2017 and then purchase the old natural gas equipment for $250,000.

Kleen alleged in court that an unfavorable financial analysis by the installer of the deal caused Xpress to begin a campaign of delays intended to prolong their lucrative agreement to sell liquid natural gas to the commercial laundry company.

Kleen’s owners said the compressed gas system was never installed and led to their company’s demise.

Skilled litigators can help business owners protect their interests and rights in complex commercial litigation. Contact a Milford law firm experienced in business litigation to discuss your firm’s legal options.