One of P.E.I.'s largest aerospace companies is involved in lawsuits worth millions of dollars.
The lawsuits surround the sale of Testori Americas, Testori Interiors and Wiebel Aerospace in April 2011. TMC Avion purchased the companies, which design and build interiors for mass transit vehicles, from Lindo Lapegna of P.E.I. and two Italian business partners.
TMC Avion is suing the former owners for close to $14 million claiming the value of the company was misrepresented.
"The sale of the Companies was a distress sale," TMC Avion says in its statement of claim.
"The companies were nearly insolvent at the time of the sale and the defendants as individual shareholders had personally guaranteed some of the Companies' debt."
Lapegna and his partners have launched a countersuit for more than $1.5 million they say TMC Avion still owes them.
Lapegna, who was president of the company before the sale, denies the companies were in trouble. He said the companies were operating at no worse than a break-even basis and they had available credit.
Provincial government carries big loan
He is concerned now that delays in financial restructuring are hurting the companies, and its arrangements with the P.E.I. government.
"This is an important operation for a province like P.E.I.," said Lapegna.
"Two hundred employees, especially some in Bloomfield, in an area like that, and the rest in Summerside, I would say it's an asset they should have treasured."
The P.E.I. government has a big investment in Testori Americas and Wiebel Aerospace. There is a $13.2 million loan that the government says is in arrears, though it won't say by how much.
"Our concern is that there continues to be an entity that functions up there, and our concern is also about the jobs that are there," said Innovation Minister Allen Roach.
According to the companies' websites there are about 185 people working at the three companies.
TMC Avion says it can't finalize its financial arrangements with the P.E.I. government until the finances with the former owners are settled.
None of these claims have been proven in court. All the parties involved are denying the allegations made against them.