Lordstown Motors Endurance

Judge Grants Stay in Lordstown Motors Lawsuit

WARREN, Ohio — A Trumbull County court has granted a stay from enforcing judgment of more than $2.5 million it says Lordstown Motors Corp. owes a Michigan-based utility service company.

Documents submitted Friday in Trumbull County Common Pleas Court show that Judge W. Wyatt McKay ordered a stay to extend through the course of an appeal Lordstown Motors filed Feb. 7 to the Eleventh District Court. 

The order also says the stay was granted based on Lordstown Motors filing a bond that amounts to one and a half times the judgment.

Lordstown Motors filed a notice to the Eleventh District Court of Appeals more than three weeks after the court issued a judgment Jan. 12 in favor of DTE Lordstown, awarding that company $2,512,214.51 plus interest.

DTE sued Lordstown Motors on Oct. 30, 2020, alleging that the EV startup company breached a utility services-agreement when it failed to make payments on several invoices, forcing DTE to terminate the contract in August of that year, according to court papers.  

The summary judgment issued by McKay stipulates that Lordstown Motors pay DTE Lordstown a balance of $181,613.42 for services and another $2,330,609.09 in termination fees.

However, Lordstown Motors asserted through points of law that its inability to pay was because of “unforeseen events,” in particular the COVID-19 pandemic, according to court papers. The company also argued that the termination payment clause is “unconscionable and unenforceable,” according to documents.

In his Jan. 12 ruling, McKay found that “no genuine issues of material fact remain, and plaintiff DTE Lordstown is entitled to judgment on claims for breach of contract.”

Copyright 2022 The Business Journal, Youngstown, Ohio.