NASHUA — Law Warehouses will press ahead with a court case challenging a decision by the state Liquor Commission to award a $200 million warehouse and transportation contract to Exel of Westerville, Ohio.
The state Supreme Court on Sept. 25 rejected an appeal by the Nashua-based warehouse company, which had unsuccessfully sought an injunction in Superior Court to block the transfer of the contract, which goes into effect Nov. 1.
Warehousing and transportation to supply the state liquor stores will soon move to a new 240,000-square-foot warehouse built by Exel in Bow, as the court case continues. Exel is a division of German-based logistics giant Deutsche Post DHL
“The Supreme Court’s recent decision not to hear our appeal asking for an injunction has no bearing on our case before the Hillsborough Superior Court, which is scheduled to be heard in May,” said Brian Law, president of the company. “We continue to believe that we twice offered the best deal to the state and the people of New Hampshire. We look forward to presenting the numerous facts that support that statement and demonstrate that the state liquor commission violated bidding laws and engaged in unlawful favoritism.”
The Liquor Commission and Attorney General’s Office maintain the request for proposals, bidding process and bid scoring that led to the contract award complied with the state’s competitive bidding statutes. Concern about the process among lawmakers and the Executive Council, however, resulted in legislation approved in the last session that would require Executive Council approval of future NHLC contracts.
Meeting today in Concord, the council will be asked to extend the state’s relationship with Law Warehouses to Dec. 13, even though the existing contract expires on Oct. 31.
“This contract amendment is necessary to ensure the expeditious transfer of product alcohol from Law Warehouses in Nashua to Exel’s warehouse in Bow and to state-owned or -operated warehouses,” wrote NHLC Chairman Joseph Mollica in his request to the council.
If approved, the retroactive contract amendment will extend existing terms with Law for six weeks.
Work on schedule
Exel spokeswoman Lynn Anderson said work is on schedule at the Bow warehouse, which has been receiving truckloads of inventory for weeks. “There has been product that’s been coming in, and that will continue until we get the inventory that’s needed for the transition,” she said.
Deliveries started in Bow around mid-September, she said, when the first wave of about 40 employees, including management, started work at the site. Another 23 workers started on Monday, she said, with the remaining 20 or so scheduled to start next week, including drivers.
In a statement released Tuesday, Brian Law said Exel has not hired any of the outgoing Law Warehouse employees, opting instead to hire temps. “Our 100-plus New Hampshire employees have paid the highest price as a result of unlawful action by the New Hampshire State Liquor Commission,” said Law. “Unfortunately, the German firm Exel has decided, for some inexplicable reason, to hire none of our well-qualified and trained employees, opting instead to hire temps and others without experience in the liquor industry.”
The total workforce at the Bow site will be about 85 in the warehouse and 10 on the transportation side, according to Anderson, who couldn’t say if any employees from Law Warehouses were hired.
“We haven’t tracked that,” she said, “but we had some applicants (from Law) and they certainly would have gone through the evaluation process like everyone else.”
Anderson said the employees at the Bow site were a mix of full-time Exel employees and some hired through a temp agency.
“There are some employees who will be temps, based on seasonal requirement of the business,” she said. “By Monday of next week we will be at 75 full-time employees, employed by Exel on Exel’s payroll. That includes warehouse workers, drivers and our management team. We are still looking for some full-time roles, so we are continuing to recruit.”
Law was ranked third in the bidding by the NHLC when it awarded the contract to Exel in late 2012. Law and second-ranked bidder, XTL-NH, argued in court filings that the request for proposals and the bidding process was rigged to favor Exel from the beginning, a charge repeatedly denied in court by lawyers from the Attorney General’s Office representing the NHLC.
Law has handled Liquor Commission logistics since the 1970s, and relies on the work for 90 percent of its revenue.