A company that performed electrical, concrete and mechanical work for Montgomery Whitewater, a rafting and kayaking park opening in July, has alleged that the general contractor treated minority-owned subcontractors inappropriately and did not pay them.

MDG Contracting & Environmental Solutions filed the lawsuit against the Montgomery County Community Cooperative District.

Montgomery Whitewater is located within the district and was created through a partnership with Southern Whitewater Development Group, according to the website.

The lawsuit describes it as a quasi-public project that required at least 30 percent of subcontractors to be owned by women or minorities. MDG is a minority-owned business that was selected to perform work on the whitewater park.

According to the lawsuit, the general contractor, the Mississippi-based company JESCO, “mismanaged scheduling of the work, including construction scope sequencing, and blamed resulting cost overruns on [minority business enterprises].”

The general contractor used that as a pretext not to pay MDG and to scale back work performed by minority subcontractors, according to the lawsuit.

“JESCO then used self-inflicted cost overruns as a pretext to not pay MDG and reduced MBE’s scopes of work—invariably awarding the MBEs’ former work to JESCO to self-perform or send to those within its ‘good ol’ boy’ network, and at times performing the work with unlicensed subcontractors, including using a largely undocumented—and cheaper work force,” the lawsuit said.

JESCO is not named as a party in the lawsuit. The lawsuit claims that the general contractor made it clear they did not want to work with MDG, failed to provide accurate and detailed construction plans and than threatened to remove work from their contract.

MDG said it was not given enough time to do some parts of the work required for the project.

On other occasions, other contractors failed to coordinate so MDG could complete its portion of the project. As a result, the company’s subcontract was terminated in July 2022, according to the lawsuit. Later, the park of the company’s contract was restored.

In late 2022, MDG officials submitted a complaint stating they were owed $7.6 million in construction costs. In a court document, attorneys for the Montgomery County Community Cooperative District said MDG had reached an agreement in July 2022 when they reversed the company’s termination, signing a letter that has been followed by all parties. As part of the agreement, the developers and the subcontractor agreed not to seek back payments from the disputed work, the motion said.

The letter of agreement should have resolved the disputes between the companies and made the lawsuit unnecessary, according to attorneys for the district.

“MDG refuses to honor the Letter Agreement,” according to the court documents. “First, MDG filed a verified statement of lien. Second, roughly two weeks later, it brought this lawsuit seeking $7,666,762.00 to enforce its already-released lien, and otherwise making claims for unjust enrichment and breach of contract.”

Lawyers for the district are seeking a dismissal of the lawsuit.

A hearing related to the case is scheduled for August.