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Economic development agencies sue Alteri Bakery over loans

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Three economic development agencies have filed state Supreme Court action against Alteri Bakery in an attempt to collect on loans each made to the Watertown business.

The Jefferson County Industrial Development Agency, Watertown Local Development Corp. and North Country Alliance Local Development Corp. filed suit Monday at the county clerk’s office claiming they are owned a combined $142,630, plus interest and late fees.

JCIDA claims it gave Alteri a $200,000 loan for equipment in 1999, with $41,706 due on the principal as of the end of April. The Watertown Local Development Corp., also known as the Watertown Trust, provided a $100,000 mortgage to the business the same year and claims $61,934 remains due. The North Country Alliance claims it lent the business $200,000 in 1998, with $38,990 remaining to be repaid. According to court documents, Alteri has been in default on the loans since August 2011, although it has been making some payments.

Alteri’s last full loan payment coincided with the month Jreck Subs Inc. announced it was shifting its submarine sandwich roll business from the Watertown bakery to a producer in Cleveland, Ohio, taking away more than half of Alteri’s business and forcing it to lay off about 20 workers.

The move prompted Seaway Valley Capital, parent company of Alteri, to sue Jreck, claiming it had a 2002 contract calling for Jreck franchises across the state to buy all of their rolls from Alteri. Jreck has countered that a subsequent agreement superseded the earlier agreement, allowing it to make the vendor change.

JCIDA and the Watertown Trust have joined Seaway Valley Capital as plaintiffs in that action, which remains pending in Supreme Court.

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