Ocean Choice files $19M countersuit

Ocean Choice International has filed a defence and counterclaim against the Prince Edward Island government, seeking damages of more than $19 million.

The company filed its defencein the Supreme Court of P.E.I. on Wednesday, in response to alawsuit filed in Juneby the province against Ocean Choice.

In its claim, the P.E.I. government said Ocean Choice International violated a sales agreement to purchase the assets of the bankrupt Polar Foods International.

Premier Robert Ghiz has said the company still owes taxpayers $9.75 million from the 2004 deal, when Ocean Choice bought the Polar Foods International assets from the province.

After the countersuit was filed, Ocean Choice officials released a statement saying the company "lived up to every commitment" made in the purchase agreement, including investing $10.9 million in capital improvements.

Most of that money went into the plant in Souris, the company said.

"I very much regret that we find it necessary to defend ourselves in court," Blaine Sullivan, Chief Operating Officer for Ocean Choice International, said in a statement.

"It is not the route I would have chosen, but the government of P.E.I. has given us no alternative after more than two years of inconclusive negotiations."

Ocean Choice International said the original agreement was that the province would not issue any more fish processing licences in order to maintain the value of the Polar FoodsInternationalassets.According to the company, there was also an agreement that ifthe government gave financial assistance to any other processor, it had to make the same offer to Ocean Choice P.E.I.

The company claimed by issuing further lobster and groundfish processing licences and providing financial assistance to competitors without offering the same benefit to Ocean Choice, government broke the contract.

"We asked for nothing other than the government live up to its obligations in the sales agreement. The government elected not to do so. In fact, the government did not inform us as it was required to do, when it secretly provided financial aid to our competitors," Sullivan said in the statement.

"We do not believe that constitutes dealing in a manner that is either honest or forthright."

The company is claiming $9,092,930.56 in damages. The company also says it's not required to pay the outstanding balance of the purchase price for Polar Foods which the provinceclaims is$9.75 million. Those two amounts bring the total value of the suit to more than $19 million.

Ocean Choice International announced in April that it was ceasing lobster processing at its plant in Souris, just days before the lobster season opened. About 300 workers lost their jobs.

The provincial government refused to comment on the $19-million countersuit.