A Pennsylvania construction company is embroiled in a legal battle over unpaid work and alleged wrongful termination. Kaiser-Martin Group, Inc. (KMG) filed a complaint against Design Group Facility Solution, Inc., Keystruct Construction, Starbucks Corporation, and Tessler Construction Company on July 12, 2024, in the York County Court of Common Pleas.
The lawsuit stems from a contract KMG entered into with Keystruct Construction on January 30, 2023. KMG was hired to provide labor, materials, and equipment for installing insulated metal panels at Starbucks' coffee roasting plant in York, Pennsylvania. The original subcontract was valued at $976,000 but later included additional work through six change orders amounting to $73,825. According to the complaint, KMG encountered numerous delays caused by Keystruct's failure to meet its contractual obligations. These delays impeded KMG's progress and led to increased costs.
Despite these challenges, KMG continued its work until November 2023 when Tessler Construction was brought in to perform parts of KMG's scope of work without proper coordination or compensation adjustments. This led to further complications and eventually resulted in Keystruct terminating KMG's subcontract on January 24, 2024. KMG claims this termination was unlawful as it lacked the required grounds stipulated in their agreement.
"Keystruct delayed our work and then wrongfully accused us of delaying the project," said David Leinbach, President of Operations at Kaiser-Martin Group. "They directed us to perform tasks out of sequence and without necessary precedent work completed."
KMG is seeking compensation for unpaid work performed and damages resulting from extended performance costs and unlawful termination. The company alleges that Keystruct owes them an outstanding balance of $375,886.96 for completed work that Starbucks accepted but remains unpaid. Additionally, they are claiming over $50,000 in extra labor costs due to extended performance caused by poor project management and more than $60,000 in lost profits due to improper subcontract modifications.
The plaintiff also accuses Design Group Facility Solution and Tessler Construction Company of tortious interference with their existing contract by allowing Tessler to perform parts of KMG's contracted work without justification or privilege.
Represented by attorney Michael Metz-Topodas from Saul Ewing LLP, Kaiser-Martin Group is seeking judgment against all defendants for breach of contract under various counts including failure to pay for work performed, uncompensated extended performance costs, unlawful termination as well as violations under the Pennsylvania Contractor and Subcontractor Payment Act (CASPA). They are also pursuing claims for unjust enrichment against Starbucks Corporation and Design Group Facility Solutions.
Case ID: 2024-SU-002033.