Bank Files Lawsuit Against Failed Mamtek
MOBERLY, Mo. (AP) — The bank that is the trustee of bonds issued for a failed artificial sweetener plant in central Missouri has sued the company responsible for the project.
UMB Bank filed the lawsuit against Mamtek U.S. Inc. and Mamtek International in federal court in eastern Missouri on Friday, alleging that bond agreements were violated. It is seeking a judgment of more than $36 million and the appointment of a receiver to take over the company's remaining assets.
Mamtek U.S. Inc. had planned to employ several hundred people at a plant in Moberly, which has about 14,000 people and is located is about 30 miles north of Columbia. The city issued $39 million in industrial development bonds to pay for the project. However, construction has stopped at the plant and Mamtek has missed a bond payment and has laid off employees.
Moberly says it has no legal obligation to appropriate money to replenish a debt service fund for the bonds. Mamtek also received an offer of about $17 million of state incentives, but state coffers are not out any money because the project collapsed before state incentives were triggered.
Earlier this fall, Mamtek U.S. Inc. assigned its assets to Development Specialists Inc. to be sold and distributed to creditors.
UMB Bank asserts in court documents that the assets could be liquidated away from the scrutiny of Missouri creditors who are owed millions of dollars. The bank said ongoing probes into the project also could be inhibited and that Mamtek officials could be shielded from accountability if there was wrongdoing.
"Distrust and concerns of mismanagement now exist regarding Mamtek," UMB Bank said in its lawsuit.
There was a busy signal Monday at a phone number for Mamtek's office in California.
Geoff Berman, vice president for Development Specialists Inc., said Monday that he has not seen the suit and could not yet comment.
In addition, Columbia-based Septagon Construction Co. Inc. filed a lawsuit on Friday in state court in Randolph County that seeks to enforce a $1.4 million construction lien for the factory. The Columbia Daily Tribune reported (http://bit.ly/ukAUPI ) that Septagon was the main construction contractor and that its suit names Mamtek U.S. Inc., Moberly, the Industrial Development Authority of Moberly and UMB Bank.
The lawsuits are the most recent turn in the artificial sweetener project that has not lived up to the July 2010 announcement that featured Gov. Jay Nixon, former Gov. Bob Holden, Moberly officials and Mamtek CEO Bruce Cole.
According to the lawsuit, the Securities and Exchange Commission issued a subpoena to UMB Bank on Sept. 9, seeking information about the requisitions by the sweetener project. According to court documents, Moberly indicated to UMB Bank that the federal investigation had been going on for months and that it and Mamtek also received subpoenas.
Missouri Attorney General Chris Koster and the Randolph County prosecutor also are investigating to determine if criminal or civil laws were violated. A state Senate committee has held two hearings and plans more, and a House committee was expected to meet later this month to review the Mamtek project.