The province of Newfoundland and Labrador is no longer pursuing a lawsuit to recover severance pay from AbitibiBowater in court.

When AbitibiBowater closed its mill in Grand Falls - Windsor, the province paid the company's severance to the 700 people that were put out of work.

The province believes that AbitibiBowater just does not have the funds available to pay them back, so they've declared the lawsuit a wasteful expense.

However, Newfoundland and Labrador are still involved in an international trade dispute with AbitibiBowater over Premier Danny Williams' decision to expropriate most of AbitibiBowater's property in the province.

The expropriation will come with a purchase price, but Williams said he now plans to deduct the cost of severance and environmental cleanup from the final amount.

"So, if the possible environmental exposure and, or, the severance were X amount, and the amount that the assets were valued at were substantially less, well, then obviously there would be no payments of cash from the government," Williams said.

The province is currently trying to put a price tag on what it will cost to clean up environmental damage the company left behind in Grand Falls-Windsor, Botwood and Buchans.

Williams believes that if Abitibi does go bankrupt, it would likely kill a challenge the company launched under the North American Free Trade Agreement against the expropriation.

Sources:
N.L. won't pursue Abitibi lawsuit over severance pay (CBC)
Not worth it - Province won't pursue legal action against Abitibi (The Telegram)