The A123 Systems saga is far from over as Johnson Controls objects to delay in payment of break-up fee and expense reimbursement.

On Dec. 17, Johnson Controls filed an appeal in bankruptcy court of the Dec. 11, 2012 sale order approving Wanxiang’s purchase of A123 Systems.

As part of the sale order, the court ordered the escrow of the break-up fee and expense reimbursement due to the company under its stalking horse agreement with A123.

Johnson Controls is appealing the sale order to obtain the breakup fee and expense reimbursement to which it is entitled under that agreement and which were previously approved by the bankruptcy court.

“We appreciated the opportunity to serve as stalking horse, which resulted in significant value to the estate, creditors and employees,” said Alex Molinaroli, president, Johnson Controls Power Solutions.

A123 was directed to place the breakup fee and expense reimbursement in escrow after A123’s creditors’ committee suggested to the court that Johnson Controls was lobbying against the sale of A123 to Wanxiang.

“As a market leader and major employer with significant operations in the United States, we have expertise and insights regarding the industries we serve, which are important resources for leaders and decision makers. Our representatives regularly provide educational material and expert opinions on many topics including advanced batteries, lithium-ion technology and the various applications they serve,” said Molinaroli.

Johnson Controls defends itself in saying it maintains an active government relations function that involves regular interaction with policy makers and agencies on the full range of issues relevant to the company. The activities of Johnson Controls’ representatives involving public officials are consistent with First Amendment rights to free speech and are strictly governed by the company’s ethics policy and comply with government regulations.

The significant issue of U.S. regulatory approval required for any sale of A123 to Wanxiang has been a constant challenge dating back to Wanxiang’s original failed attempt to acquire A123 earlier in 2012, prior to bankruptcy.

Johnson Controls says it has consistently maintained that national security questions tied to the core technology used in all of A123’s businesses represent a risk to the sale which cannot be dismissed until resolved by the government review process.

Johnson Controls says it shared and still shares concerns that have been voiced by members of Congress and other interested parties and therefore will continue to monitor this process.

“Should the sale of A123 Systems to Wanxiang not be completed for any reason, Johnson Controls remains open to considering future opportunities to acquire relevant portions of A123’s assets, keeping this critically important technology in the United States, preserving jobs and furthering the purpose of the American Reinvestment and Recovery Act,” said Molinaroli.