Posted: October 26, 2017
One of our building and construction trade clients located in Midland, Michigan found it necessary to remove a subcontractor from a job in Indiana due to the subcontractor’s unwillingness or inability to pay its vendors and meet related obligations. When our client made payment directly to those creditors and subtracted the amount from what was owed to the subcontractor, the subcontractor sued our client in an Indiana state court. Reviewing the written subcontract, Kraig demanded that the subcontractor withdraw its lawsuit or face sanctions. Since an arbitration provision existed in the contract, Kraig raised issues of federal preemption under the Federal Arbitration Act which disallowed the plaintiff/subcontractor from proceeding in state court. On the strength of Kraig’s demand letter, the plaintiff withdrew the claim and, as of this writing, has not attempted to resurrect any claim against our client in any other forum.
Congratulations to Kraig on a great result for the client.