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Suit filed against 1st Urban Fiber

March 03, 1998|By BRENDAN KIRBY

Suit filed against 1st Urban Fiber

A Woodbridge, Va.-based firm Monday filed suit against 1st Urban Fiber Sales and the company that built the now-closed paper recycling plant claiming it has not been paid more than $300,000 in rent for warehouses in Washington County Airpark.

In the suit, Top Flight Airpark asks for $301,295 plus interest for the rent. The company received no rent payments between Aug. 1, 1997, and Feb. 1, 1998, the suit says.

First Urban Fiber closed its $250 million paper recycling plant last August, citing a depressed market for recycled paper. A receiver was appointed to maintain the company's assets and defend it against litigation.

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The receiver, G. Richard Gray, could not be reached for comment on Monday.

First Urban is named in the suit for three leases signed with Top Flight. SBCCS Constructors, which built the firm's plant on Memorial Boulevard, is named for two leases.

According to the suit, SBCCS and 1st Urban signed a lease in September 1995 for 56,850 square feet of space.

In October 1996, 1st Urban signed a lease for 30,650 square feet of additional warehouse space, according to the suit. The following April, 1st Urban signed a third lease for 43,750 square feet, the suit said.

There are an estimated 24 trailer loads of materials stored in the warehouses, according to the February receiver's report.

The total estimated value of the material is $51,000. A court order approved the sale of that material, but Top Flight has denied access to the warehouse, according to the receiver's report.

When it opened in October 1996, the 1st Urban Fiber plant was to produce dried pulp from waste paper. The pulp could be used to make colored paper and fine writing paper.

But the price for recycled pulp plummeted and the plant was forced to shut down. Forty employees were indefinitely laid off last April and 53 workers were dismissed in August.

Bondholders asked the court to appoint a receiver after the plant's owners missed a semiannual payment to the bondholders.

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