REGINA - The opposition New Democrats were on offence Monday over the news that Premier Scott Moe had been named in a court filing by Shercom Industries Inc.
Saskatoon-based Shercom has filed suit against Stevyn Arnt, Tire Stewardship of Saskatchewan (TSS) and the Government of Saskatchewan. Shercom is seeking $10 million in damages for “breach of contract and/or promissory estoppel” against the government and is also seeking damages for “injurious falsehood” as well as punitive damages against Arnt, who is CEO of TSS, as well as against TSS itself.
The statement of claim was filed on Nov. 8, 2024, at the Court of Queen’s Bench, Saskatoon and copies were provided to the media by the NDP on Monday morning.
The mention of Moe came on page four of the Statement of Claim, which described a meeting on or about March 22, 2017 between Moe, who was the province's Environment Minister at the time, and Shercom President Shane Olson.
The meeting happened after a fire had decimated the Shercom plant and the company was looking at rebuilding. According to the contents of the court filing, it was claimed Minister Moe had assured Olson that he had been directed by the Premier, Brad Wall, to “fix” the scrap tire recycling program.
The Statement of Claim stated this “fixing” would “focus on creating a safe place for Shercom to reinvest and rebuild its processing plant.
“Minister Moe then invited Mr. Olson into a small office to discuss details. He asked, ‘What do you need to rebuild?’ Mr. Olson responded that Shercom needed: (a) a long-term contract; (b) assurance of supply; and (c) a voice in the future of the industry.
“Mr. Moe, on behalf of the GoS (Government of Saskatchewan), assured Shercom that these requirements would be met by the GoS.”
That meeting was followed by a chain of events in which Shercom would rebuild its facility but ultimately lose the tire recycling contract for the province. Tire Stewardship of Saskatchewan ultimately awarded contracts for the south and then the north of the province to U.S.-based CRM Co. LLC, based in California. This year, Shercom has announced job losses in the wake of this news.
“The Sask Party is running a local success story out of business in favour of a California-based company with Sask Party ties, and as we've learned, Premier Moe has been a major player in this tire fire all along,” said NDP Jobs critic Aleana Young to reporters Monday.
“Moe promised that the Government of Saskatchewan would provide Shercom with, one, a long-term contract, two, assurances of supply of used tires, and three, a voice in the future of the tire recycling industry. However, after becoming Premier, Moe broke his promise, and he awarded Shercom’s contract to California-based CRM, which had hired former Sask Party Finance Minister Kevin Doherty to lobby Moe. As a result, Shercom has already laid off over 50 workers, and the company is set to cut 79 more jobs on Dec. 2 unless the Saskatchewan Party government reverses its decision.
Young called on the Saskatchewan Party government to “be straight with Saskatchewan people, take responsibility, and bring these jobs back to Martensville and Warman. Saskatchewan workers and companies should come first, not big California businesses with political connections.”
That there had been a meeting between Olson and Moe is not new news; the issues involving Shercom had been raised back during the spring when the Opposition went on a sustained attack against the government over the award of the tire recycling contract to CRM. Olson had also confirmed to reporters around that time that a meeting had taken place.
The point Young seemed interested in making was that Saskatchewan jobs were being impacted.
“This is, I think, a really telling court submission,” Young told reporters.
“Again, I mean the government should be putting Saskatchewan businesses and workers first, not fighting them in court, but it is not common, even in Saskatchewan politics, that we get a court filing by a major company, a major employer here in Saskatchewan, that names the sitting Premier as being intimately involved in their decision to rebuild, and then pulling the rug out from underneath them, leaving them with millions and millions and millions of dollars of stranded assets after they were actively excluded from a competitive bid process. It is hard to wrap your head around. I think for the government they should make this make sense, because to the average person, it certainly doesn't, and the Premier is named in this court filing and seems to be at the heart of this entire fire.”
Premier Moe asked if he could speak to the Shercom Statement of Claim during a news conference Monday. He replied “no, I can’t.”
But Moe did offer to reporters a high-level overview “with respect to the government’s role in tire recycling in general.”
“The government’s role is to set up a regulatory environment where the industry is able to set up a board, and thus TSS, that will then govern how tires are recycled in this province.” He said members of the board are representative of retailers in the Ag industry, the truck industry, and transport industry.
“The very people that are selling those tires are making decisions about how they are being recycled. So the government’s role in this space is to set up a regulatory environment where they can recycle the tires that they are selling, and to set up the opportunity for them to collect the fees so they can pay for the recycling and whatnot.”
When asked about the 131 job losses at Shercom, Moe responded: ”I think there are still tires that are going to be recycled by either Shercom or somebody in this space, so the job opportunities here I think would remain, largely. I would say that the program is one that was asked for by municipalities a number of years ago to ensure we don’t have tires going into our municipal landfills, so the primary focus of the program — the primary role of the government — is to set up a regulatory environment so that isn’t happening. So that the industry represented on the board by the people selling the tires is able to set up a recycling program plan and payment so that those tires aren’t a fire hazard in our landfills, they’re being taken care of in a responsible way.”
