WARREN — The city of Warren has been ordered to pay $4.5 million in damages after a jury found the city liable for breaching a contract related to a former recycling facility on the city’s southwest side, according to Trumbull County Common Pleas Court records.

The lawsuit was brought in February 2023, by Northeast Ohio Development Group, which operated North East Ohio Automated Recycling Center (NEO-ARC), a waste management plant meant to process and separate recyclables from landfill waste. The plant, which was located on Front Street SW, was approved as a receiving facility by the Geauga-Trumbull Solid Waste Management District and given a zoning variance in 2014.

The city entered into a contract with Tony Grech, owner of NEO-ARC, in August 2016. However, the company lasted only five months before Warren officials canceled the contract, a move that the lawsuit argued led to severe financial losses.

The jury determined in January 2025 that the plaintiff successfully proved by a “preponderance of evidence” that the breach resulted in significant monetary damages, totaling $4,500,000. The lawsuit initially sought $6 million, citing that the city’s failure to uphold its obligations had irreparably harmed the company.

According to court filings, NEO-ARC invested $8.7 million into the facility and had taken out a 10-year lease on the property. Grech had personally guaranteed $5 million in bank loans, stating he had “invested his life savings” into the project.

The plant was designed to sort and bale recyclable materials, including cardboard, plastics, paper and metals, for sale to world markets through a global commodity broker.

Grech originally estimated the facility would employ between 40 and 100 workers on three shifts, processing 360 tons of waste per day.

According to Tribune Chronicle archives, the dispute escalated in January 2017 when then Safety Service Director Enzo Cantalamessa sent a letter citing contract violations, stating the facility had been closed on four occasions, forcing the city to use an alternative landfill.

The letter also accused the company of refusing to take certain types of waste, despite the contract stating that NEO-ARC was required to process “any other waste” not specifically prohibited.

The lawsuit countered that the contract had explicitly limited the types of waste the facility was required to accept and that Warren had failed to provide promised infrastructure improvements.

The city’s law director, Cantalamessa said the city is considering an appeal but keeping its options open. He said he was unable to comment further.

A court document filed Thursday by NEO-ARC’s attorney reiterated the company’s stance that Warren’s abrupt contract cancellation caused “long-term economic harm” and placed undue strain on the company’s operations.

The document states, “The City of Warren unilaterally terminated the agreement without proper justification, causing irreparable financial harm to the plaintiff, who had already made substantial investments in reliance on the contract.”

Additionally, the brief argues that “negotiations to remedy the breaches were either ignored or delayed to the detriment of Northeast Ohio Development Group, ultimately forcing litigation as the only recourse.”