The lithium-battery manufacturing company iM3NY has reportedly laid off most of its employees. According to reporting from WIVT, the Endicott battery factory announced layoffs during a staff meeting last week.
The move comes after the company received over $500,000 in state funding and tax credits, and raises questions over whether the investment in the local battery hub will deliver the jobs and economic prosperity promised to the region.
Plans for the gigafactory were announced in 2017 as part of a state investment in advancing battery technology. Lithium batteries can store energy from renewable sources like wind and solar. They are a key part of transitioning the state away from using fossil fuels.
Located at the former IBM factory complex, iM3NY was expected to bring 2,500 jobs to the area. The company had created nearly 90 jobs by mid-2023, according to state records.
But almost all of those jobs appear to have been lost, and the technological promises the company made has been called into question in a recent lawsuit.
iM3NY and its director, Shailesh Upreti, did not respond to multiple requests for comment from WSKG. However, Upreti confirmed the layoffs to WIVT. He told the news outlet the company is seeking new investors, and called the layoffs a temporary challenge.
The factory was fairly quiet last Thursday, just days after layoffs were announced. Several employees walking to their cars in the parking lot declined to speak to WSKG.
The state's economic development agency, Empire State Development, confirmed that the agency “is aware that the company has paused operations in Endicott."
Promised jobs
In the village of Endicott, which has suffered major job losses as other industries have shuttered, the opening of the iM3NY plant represented a potential economic boon. Elected officials, including U.S. Senate Majority Leader Chuck Schumer, praised the company as a partner in efforts to revitalize the region, and poured state money into its development.
NYSERDA, the state energy authority, previously presented the company as a case study for attracting, training, and retaining a technical workforce. An agency spokesperson told WSKG that it had provided nearly $380,000 in total funding to iM3NY to support the hiring and training of 56 employees between 2022 and 2023.
The spokesperson said the company was required to provide information about its work to meet the terms of its contracts. The agency did not comment on the reported layoffs.
Other state funding for iM3NY came from Empire State Development, which provided tax credits to the company in exchange for creating jobs. The company received $17,000 in tax credits in 2021 and $127,000 in 2022, according to an agency spokesperson.
Last year, Schumer supported the company’s request for a $700 million loan from the U.S. Department of Energy to scale up production. A department spokesperson said it cannot provide information about the status of a loan application. However, the company is not listed on the page of projects that the department is supporting.
Schumer did not respond to WSKG’s questions about the company’s apparent operational pause or the status of the loan. A press release in which he supported iM3NY’s loan application is no longer available on the senator’s website.
Allegations of ‘misleading or deceptive conduct’
The shutdown of the iM3NY manufacturing plant comes amid a lawsuit that questions whether the company was ever able to produce the battery technology it promised.
In April, Australia’s financial regulator filed a lawsuit against iM3NY’s majority shareholder, Magnis Energy Technologies, in Australian court. The lawsuit alleges Magnis officials engaged in “misleading or deceptive” conduct by failing to disclose technological and financial difficulties the iM3NY factory faced.
Documents filed in the lawsuit last month allege that Magnis was aware that iM3NY was struggling to “produce saleable [battery] cells at scale” due to technical issues, like the swelling of cells in the batteries and problems automating the production process.
The lawsuit also outlines a meeting between representatives from iM3NY and Magnis in August 2023, during which Magnis’ chief financial officer said the iM3NY facility in Endicott was “nowhere near being able to produce batteries,” which the lawsuit argues contradicted press releases the company had put out to investors.
Magnis, which owns around 60% of iM3NY’s shares, has argued that any information it passed along to investors about production at the factory came directly from iM3NY. The company said in a statement to investors last Wednesday that “Magnis has not been involved in the running of iM3NY since December 2023.”
The two companies were embroiled in legal disputes last year over control of the company’s board. In February, Upreti, iM3NY’s director, announced the company was seeking new investors.
In response to questions about the reported layoffs, Magnis’ communications manager, Con Hoursalas, said the company was “deeply saddened to learn of layoffs at iM3NY.” Hoursalas added that the company would not comment further due to “impending litigation and damages in planning by Magnis.”
“The extent of the Magnis legal action will be wide-reaching and include companies, individuals, and their related parties liable for misconduct and misrepresentations,” Hoursalas wrote. “Magnis representatives have and continue to suggest multiple remedial and turnaround actions for iM3NY's commercialization.”
An uncertain future
Last year, Schumer applauded the designation of the Binghamton area as a federal hub for battery development. His advocacy secured millions of federal dollars to support organizations leading research and innovation of battery technology, spearheaded by Binghamton University.
“For months you could feel the electricity and excitement in Binghamton over the growing battery industry,” said Schumer in a statement last year. “With Tech Hubs we can breathe new life into our cities with the industries of the future. And nowhere is that more true than in Binghamton.”
It is unclear now what the apparent shuttering of iM3NY will mean for the rest of the nascent battery industry in Endicott and Binghamton.
The company is listed as a partner of New Energy New York, the Binghamton University-run coalition of energy industry leaders, academic experts, government officials, and nonprofits charged with leading the region’s battery developments.
Though the coalition has received federal and state grants in recent years, Binghamton University’s director of media and public relations, Ryan Yarosh, said none of that money went to iM3NY.
New Energy New York has designated this week as “Battery Week”. The group will gather energy and battery industry leaders in Binghamton, just miles from the quiet iM3NY plant.