Business
5:49 pm
Fri February 28, 2014

Moberly ruled not responsible for Mamtek bonds

A federal judge has ruled that the city of Moberly, Mo., and its industrial development authority are not responsible for bonds involved in a failed artificial sweetener plant project.

Moberly and the agency issued $39 million in bonds in July 2010 to finance construction of a Mamtek plant, which was expected to create 600 jobs. The project never materialized.

U.S. District Judge Nanette Laughrey ruled Monday that city legally issued the bonds. She said the concept that governments can't be sued for legal official acts prevents investment banker Morgan Keegan from arguing that the city was liable for the losses. Morgan Keegan sold the bonds issued by Moberly.

The Columbia Daily Tribune reports Morgan Keegan's attorney, Chuck Hatfield, said his clients haven't decided whether to appeal the ruling.