Hudson -- Little Tikes, one of the top five employers in the city, has filed a complaint and subsequent lawsuit for $1.1 million to have manufacturing equipment returned.
Little Tikes hired Prime Plastics in Washington County, Penn., to produce products using Little Tikes molds, according to Little Tikes General Manager Tom Richmond and Prime Plastics trustee Robert Bernstein.
Prime Plastics filed Chapter 11 bankruptcy for reorganization in February 2013, and Bernstein said a hearing was scheduled Jan. 8, 2014, to file Chapter 7 for liquidation of the company's assets.
"Prime Plastics owes a lot of money and part of my job as trustee is to collect as much money as I can to pay its debts," Bernstein said Jan. 7.
Little Tikes and Prime Plastics disagree on Prime Plastics' right to assert a lien against the molds, according to Bernstein.
Bernstein said Little Tikes owed Prime Plastics $400,000 for products it produced for them but was not paid for.
"When we [Bernstein and Little Tikes] were before the bankruptcy judge in November, I said if they [Little Tikes] put up a bond of $400,000, I'd let them have the molds," Bernstein said. "They wanted the molds without posting a bond."
Little Tikes attorney Jonathan Babyak said he had no comment when contacted about the lawsuit.
The bankruptcy judge did not have the power to return the molds, he said.
"The bankruptcy court is currently holding our molds in contention," Richmond said. "We'll be appealing the current situation."
In December 2013, Little Tikes filed a complaint for $1.1 million in the Washington County Court of Common Pleas in Pennsylvania against Prime Plastics Inc. to return its molds.
"We hope the courts do the right thing, and we get our molds back," Richmond said.
Richmond said is it not uncommon to use outside molders to produce products, and the blow moldings loaned to Prime Plastics utilize a different process than the plastic injection molds used in the Hudson facility.
"The dispute is just getting our tools back," Richmond said. "It's in contention, so I can't talk about it."
The lack of components impacted the recent holiday sales for Little Tikes, Richmond said.
"It did have some impact on this past Christmas, unfortunately," he said. "But there wasn't a lot we could do about it."
Facebook: Laura Freeman, Record Publishing