Zodiac Industries Inc., a sheet metal fabricator in Port Chester, has filed for Chapter 11 bankruptcy protection, blaming its financial problems on a union that represents its workers.
Zodiac declared nearly $243,000 in assets and more than $1 million in liabilities in a petition filed on Feb. 16 in U.S. Bankruptcy Court in White Plains.
Zodiac is a closely held family business founded in 1981. It manufactures sheet metal products for construction projects, amoung them the Charles L. Brieant Federal Courthouse in White Plains.
Company President Frank Pasqualini said in an affidavit that financial troubles stem from a dispute with Local 38 of the Sheet Metal Workers International Association.
The union’s insurance and welfare fund sued Zodiac and Pasqualini last year in federal court, alleging fraud, breach of fiduciary duties and breach of a collective bargaining agreement for failure to pay fringe benefits. Zodiac disputes the allegations and claims that the company overpaid the union.
Pasqualini said the union threatened to shut down the company’s job sites unless it made payments, so Zodiac paid more than $800,000 “under duress,” but union workers were pulled off a job site anyway.
Zodiac had booked work for about $2 million. When the union shut down operations, Pasqualini said, the company was unable to complete the jobs.
Pasqualini said the $800,000 in payments crippled the company and the work stoppage was devastating.
He said bankruptcy protection will allow the company to reorganize and recover.