By Mike Scarcella

WASHINGTON, July 1 (Reuters) - A subsidiary of Chinese battery manufacturer Gotion 002074.SZ has sued a Michigan township to seek millions of dollars in damages after it said officials withdrew their support for a development agreement for a $2.36 billion electric vehicle components plant and blocked the project.

The lawsuit, filed in federal court in Michigan, accuses Green Charter Township of breaching the 2023 development agreement in which it had agreed to support the project and help secure permits and approvals needed to move it forward.

The complaint was amended from an earlier version of the lawsuit that was filed in 2024 and sought to force Green Charter to comply with the development agreement for a plant that would produce key materials for electric vehicle batteries.

A federal appeals court in February said the bid for an injunction no longer could be sustained after state support for the project was withdrawn.

"The township's continued breaches of the development agreement have completely undermined the project and thereby unraveled an endeavor that [was] years and millions of dollars in the making," Gotion's lawsuit said.

Gotion and representatives from Green Charter did not immediately respond to requests for comment on Wednesday.

The battery plant, first announced in October 2022, was expected to create about 2,350 factory jobs but drew criticism from some lawmakers over the company's Chinese ownership.

Michigan has said Gotion abandoned its plan for the plant, an allegation that a lawyer for the company has called "utterly false."

Gotion’s amended lawsuit said it has spent millions of dollars on land acquisition, planning, infrastructure and other project-related costs. It also alleges it faces additional financial harm after Michigan in January demanded repayment of more than $23.7 million in grant funds tied to the development.

The new lawsuit seeks unspecified damages for lost profits that Gotion said it would have earned from the battery plant for years in the future, in addition to damages that would cover the state's repayment demand.

The case is Gotion Inc v. Green Charter Township, U.S. District Court, Western District of Michigan, No. 1:24-cv-00275-JMB-PJG.

For plaintiff: Mark Heusel and Jacob Clark of Dickinson Wright

For defendant: Christopher Patterson, Eric Conn and Kyle O'Meara of Fahey Schultz Burzych Rhodes

Read more:

Michigan AG asks Chinese battery maker Gotion to return $23.7 million after defaulting on US plant

China-linked battery company abandons plan to build Michigan plant, state says

China's Gotion sues US township for breach of contract over $2.4 billion plant