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Cheese company accuses city of fraud, wants $31million in damages.


The owner of an idled kosher food plant in Ogdensburg has added accusations of fraud to its ongoing lawsuit against the city and is demanding $31 million in damages.

Toobroburg LLC, owned by Menachem and Schneur Bistritzky, on Oct. 22 filed an amendment in state Supreme Court, Canton, adding to its initial May 2010 complaint against the city alleging unfair charges for water and sewer services at the 30 Main St. plant.

The case is set to be heard in court on Dec. 6.

Menachem Bistritzky said Friday that 2002 email correspondence between the city and its paid consultant, Lu Engineers of Pittsford, mentioned the existence of unknown daily sewage flow for which his Nassau County-based company was billed.

“The defendants were aware that not less than twenty-nine thousand (29,000) gallons of unknown substances was infiltrating the plant from various known and unknown sources which outflow was being billed for sewer discharges purposes/use charges,” the complaint states. “At no time did the city disclose any plumbing, sewer, water to other inadequacies in the plant or make known as water infiltration, sewer billing issues or other defects to the water system.”

Toobroburg took over the plant in 2009.

“The city never fixed it,” Mr. Bistritzky said Friday. “The city fraudulently billed us.”

Mr. Bistritzky presumes that the 29,000-gallon figure from 2002 was no longer valid by the time Toobroburg arrived in 2009.

“It could be any number now,” he said. “For all we know, it could be 100,000 gallons a day.”

Mr. Bistritzky has contended from the start of his litigation that the city used inaccurate measurements to determining the plant’s daily water and sewer use, thus ramping up Toobroburg’s bill. He also claimed the plant was being billed at a higher rate than other commercial businesses for city services.

The company made “cholov yisroel”-grade kosher cheese and milk. The city agreed to sell the plant to Toobroburg for a $125,000 down payment, $12,000 monthly rent for 13 months and a closing payment of up to $900,000. The company put its down payment in an escrow account, but subsequently missed deadlines that would have allowed the monthly rent payments to be put toward the closing payment amount.

Current figures on Toobroburg’s debt to the city were unavailable on Friday. City Attorney Andrew W. Silver was not available for comment.

The city took over the cheese plant in 2008 after ex-owner Ahava Food Corp., Venice, Calif., failed to pay about $90,000 owed in rent and $618,138 in utility bills.

The $31 million in damages are being sought for what the complaint describes as “massive overbillings to the defendant for sewer discharge, the inability to use the wells on the premises, loss of investment to the premises, loss of operational income from the plant, expert and reasonable attorney’s fees.”

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