The recycling company Ricova is taking the City of Montreal to court over its decision to ban it from bidding on contracts for the next five years.
The Quebec Superior Court lawsuit names both the city and the city's inspector general, Brigitte Bishop. Bishop issued a report in March alleging the company did not pay Montreal its fair share of recycling profits.
In a statement Thursday, Ricova said Montreal is "acting illegally, showing bad faith and exceeding its powers."
Ricova Services Inc., based in Brossard, Que., has been operating Montreal's two recycling sorting centres, in Lachine and Saint-Michel, since 2020 and collects curbside recycling from two of the city's boroughs.
It also has collection contracts with several municipalities in the Montreal area.
In her report, Bishop said Ricova Services Inc. had sold recyclable materials to one of its sister companies, Ricova International Inc., which then sold them to outside buyers at a higher price.
In all, the report alleges Ricova withheld more than $1 million it owed the city for recycled materials it sold over a 12-month period.
Bishop recommended the city block the company from bidding on contracts for five years and cut ties with the company "as soon as possible."
The ban on future bids, made official earlier this month by the city's executive committee, does not affect existing contracts with the city.
In the statement issued Thursday, Ricova spokesperson Stephanie Dunglas said the City of Montreal "knew very well that the material was sold at the Quebec market price to Ricova International."
Dunglas said that arrangement was already in place even before Ricova took over the Saint-Michel sorting centre two years ago.