Six lien claims against Nestle Purina Petcare Company’s Mechanicsburg, Pennsylvania factory are holding back the company’s goals for expansion, with contractors claiming a total of $4,594,887.87 in nonpayment.
Nestle Purina announced plans to expand the factory’s processing and packaging capabilities in 2020. According to a July 2020 press release from the company, Nestle Purina was planning on investing more than $167 million into its presence in Pennsylvania’s Cumberland County through at least 2023, noting that “demand…is strong and continues to grow.”
Edwin L. Heim Co., Echo Industrial Inc., SteelFab Texas Inc., Gooding, Simpson, and Mackes Inc., and First Davis Corporation all filed mechanics liens on the Purina factory in November 2021.
- Heim Co.: $768,923.80 claimed for installation of cables, sensors, wires, and other materials related to the project’s electrical lines, as well as the supply of temporary power to the project.
- ECHO Industrial: $1,400,473.40 claimed for installation of steel platforms, subframes, and bollards for the project.
- SteelFab Texas: $1,103,320.94 claimed for installation of structural steel work for the project.
- Gooding, Simpson, and Mackes, Inc.: $577,853.08 total claimed as part of two liens for patching and repairing of roofing, as well as the installation of a PVC roofing membrane system.
- First Davis Corporation: $744,316.65 claimed for work done on the project’s manufacturing line.
These legal challenges are coming at a difficult time for Purina, which has been aiming to make significant investments in its properties in Pennsylvania.
“This expansion reflects an investment in our local operations, and we look forward to continuing to deliver innovative and highly nutritious foods for pets,” said Purina Vice President of Manufacturing John Bear.
It’s important to note that the size of the project — at least $167 million, as publicly discussed — is significant. Though $5 million seems like just a small amount of the project’s full budget, the power of the mechanics lien — also known as a construction lien — is that a small amount can get the attention of a big company and a big project.
“Property owners hate mechanic lien claims,” says Levelset’s Scott Wolfe Jr. “These claims get attention and they cost the owner money. When a lien claim is filed, the property owner is at risk of having to pay for the same construction work twice. Clearly, this is something they don’t want to do. As a result, when you’re unpaid on a construction job, you can get attention to your situation real fast with a mechanics lien claim.”
“When negotiating a debt, leverage is everything, Wolfe continues. “Any attorney or collection agent will tell you, having a mechanics lien connected to a debt is going to significantly increase the chances of having that debt paid. A mechanics lien on the property gives your debt security, it involves more parties, it creates contractual breaches, and it’s hard to remove — a lot of the reasons explained above. For these reasons it creates leverage, which becomes another way the mechanics lien can help get you paid.”
These contractors have a while to get their payment situation figured out, as well. State lien laws allow for a lengthy period of enforcement: Once a lien has been filed in Pennsylvania, it’s valid for at least two years.
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