A manufacturer of salt chlorine generators and a Northeast distributor are embroiled in an ongoing lawsuit.

At first glance, it appears to be a traditional case regarding breach of contract. As the details unfold, however, much higher stakes are revealed.

In a complaint filed on Jan. 11, 2012, in Orange County, Fla., Compu Pool Products USA alleged that AquaComfort Technologies, LLC, breached a contract.

According to court documents and company officials, AquaComfort ordered a number of custom-designed salt chlorine generators from Compu Pool and allegedly failed to pay for some of the units.

“We never got paid. For a six-month period, all the units that we made and shipped, we never got paid for,” said Nick Millar, general manager at Compu Pool Products, headquartered in Queensland, Australia.

According to the complaint, the defendant owes $454,032.14 for payment of goods as well as damages.

AquaComfort filed an answer and counter-complaint, and denied owing the money.

“[AquaComfort] did not pay the funds requested in part because the units were faulty and because many of the units were returned, and in their opinion they are not responsible for the ones returned,” said the distributor’s attorney, Kevin J. Morris of St. Petersburg, Fla.

Wallingford, Conn.-based AquaComfort began distributing Compu Pool-branded salt chlorine generators in 2010, according to Morris. Aqua Comfort sold approximately 1,535 of those units to dealers.

Then AquaComfort asked for a product with a unique appearance for its dealers to differentiate itself in the market. In response, Compu Pool provided a custom-made model that the distributor sold from May 2011 until the end of the year, Morris explained. Approximately 450 of these units were manufactured.

“They began providing a unit with a different appearance. It was a different shape, but the internal components were the same,” he stated.

After beginning to install the new models sometime in May, 2011, dealers began reporting that the units were melting during operation, according to Morris.

Randy Budd, president of Budd’s Pools & Spas in Deptford, N.J., said that in the past two years, he has installed more than 200 of the salt chlorine generators after purchasing them through AquaComfort and is worried there are defective ones at his customers’ homes that could melt at any time. 

“They are melting. ... It’s a huge safety issue,” said Budd, who reported four incidents, including one unit that began smoldering next to a gas heater.

“I’m concerned someone is going to get hurt. It’s a public safety hazard,”  he added.

Budd’s is one of several companies that have purchased the units from AquaComfort, said Morris. Another is Danbury, Conn.-based Nejame & Sons, a Pool & Spa News Top Builder. The firm installed nearly 40 units, 25 percent of which have failed, said co-owner Ed Nejame. After receiving roughly 10 complaints, Nejame said he pulled all of them from the field and replaced them with  models from a different manufacturer.

“It was ridiculous. We could have had more [problems] if we didn’t start yanking those things off,” Nejame said.

All told, Morris said there are more than 60 known cases involving melting salt chlorine generators, though Compu Pool officials dispute this figure. The affected builders reportedly have replaced 450 units, though many were returned unopened, and not all of them were part of the batch custom-made for AquaComfort, said Morris.

He also indicated the distributor and its dealers believe more of the units will be reported as faulty and will need to be replaced throughout the remainder of the 2012 swim season.

“We are still getting units that are failing in the field,” Morris said, adding that a replacement was made as recently as early July.

However, Compu Pool has a different side to the story.

While company officials are aware of the incidents, Millar said, AquaComfort is inflating the number of cases for purposes of the lawsuit. He added that his company made every attempt to rectify the problem and maintain a healthy relationship with the distributor. First, Compu Pool accepted hundreds of returns and credited AquaComfort for the units, some that showed melting, as well as others with no visible damage and new ones that had never been installed, he explained.

Moreover, while AquaComfort states that the custom-made units had the same internal configuration as Compu Pools’ mass-distributed products, Compu Pool officials firmly deny this claim.

“The units sold by AquaComfort in 2011 were nothing like our mainstream Compu Pool units,” Millar stated. “The cell configuration is totally different.”

The company also conducted a study and concluded the problems were a result of installation issues, Millar said.

In an official investigative report, Compu Pool determined that “the failed cells have melted or burnt in the area around the brass pins due to overheating. The problem is the result of insufficient electrical connection in the brass pin region,” the report stated. “The insufficient connection causes the brass pins to overheat and melt the surrounding plastic.”

The document also provided instruction on how to properly connect the cells to avoid potential melting. Though he doesn’t deny that melting has occurred, Millar stressed that the units are made of flame-retardant material. Because of this, they cannot actually catch on fire, and pose no hazard, he said.

“We checked all the ones that came back from a manufacturing standpoint and they were all in line with what they should have,” Millar said. “The cell design and the pins going onto it don’t appear to have caused the problem.”

Compu Pool also sent replacement cells to the distributor and reportedly paid the fees for their installation.

“We’ve done so much, and we’ve obviously lost considerable money and spent a lot of time trying to make things right,” he added.

These attempts were insufficient said Morris, who claimed that one-third of the replacement cells also failed when installed.

What will happen next remains to be seen. The first court date has been set for Aug. 21, at which time a judge will determine if AquaComfort will be required to supply a list to Compu Pool detailing all its dealers who purchased and/or installed the units, as well as the names and addresses of all the end users, said Morris.