Port Hawkesbury Paper is denying it breached a contract with American company Bengal Paper and says it will continue to fight the legal battle.
Lawsuits and counter suits have been filed in the lawsuit between the two companies.
According to documents filed in Nova Scotia Supreme Court, Port Hawkesbury Paper sued first. It accused Bengal of not paying for paper it ordered and wants $450,000.
Bengal Paper claims Port Hawkesbury Paper failed to deliver the full order, leaving it unable to meet client orders.
Port Hawkesbury Paper now states that any damage to Bengal resulted from its own wrongful actions.
No dates have been set for a hearing.
The Port Hawkesbury Paper mill produces 400,000 tonnes of glossy paper a year.
That paper is used in magazines and catalogues.
About 750 people are employed with the mill.