The Pennsylvania Superior Court has refused to block a lawsuit filed in Blair County in which the former owner of PowerHouse Subs has charged civilly that he was “lied to and tricked” into selling the assets of his business to the present owners.

The Wednesday decision dismissed a petition filed by attorney Briar Siljander of Michigan on behalf of the present owners of PowerHouse Subs LLC and PowerHouse Subs Investments that challenged the legality of a ruling in June 2022 by Blair County Judge Jackie Bernard.

Bernard in a lengthy opinion gave the go-ahead to a lawsuit by Powerhouse founder Michael McDonnell of Hollidaysburg.

McDonnell admits that in 2019 he signed an asset purchase agreement that transferred the sub shop to new ownership, but he contended the company subsequently violated agreed-upon terms of the sale that included continuing employment for McDonnell and members of his family who worked for the company.

The founder of the firm contended he was interested in a proposal by the new owners to make PowerHouse Subs a national brand.

The deal eventually “went sour,” said Bernard in her opinion.

McDonnell and family members opened a new sub shop, which the PowerHouse management alleges violated a non-competition agreement that was part of the asset purchase sale.

PowerHouse Subs, which operates three shops in Blair County, filed a federal lawsuit seeking money damages from McDonnell and family members because of the violation of the non-competition agreement.

That case went to trial last month and is presently under review by federal District Judge Kim R. Gibson in Johnstown.

Meanwhile, McDonnell filed his lawsuit in the Blair County Court of Common Pleas seeking restoration of his ownership of the firm or compensation for the loss of his business.

He has sued PowerHouse Subs LLC, PowerHouse Subs Investments, three other companies involved in the transfer of the ownership (Elevation Holdings LLC, Revzip LLC, and EMG Brands LLC), as well as Tyrone-area businessmen John Russell, William Russell, Ryan DelBaggio and Brice Mertiff.

The defendants in the state litigation filed objections to the lawsuit and asked Bernard to dismiss McDonnell’s lawsuit, but in her 2022 ruling, she concluded it could proceed.

Bernard questioned whether it was a waste of judicial time and resources to have parallel cases in both the state and federal courts, but she stated there was no prohibition against such a circumstance, and she found no reason legally why McDonnell’s lawsuit could not proceed.

Siljander appealed her decision to the Pennsylvania Superior Court contending McDonnell is barred from asserting a state claim.

He argued that McDonnell’s claims should have been raised as part of the federal lawsuit.

On Wednesday, a Superior Court panel that included Judges John T. Bender, Anne E. Lazarus and Deborah A. Kunselman issued an opinion that concluded that the new owners did not follow proper procedure in filing the state appeal.

The objections to Bernard’s decision should have been made part of the court record by first filing them with the Blair County prothonotary, which was not done, the Superior Court ruled.

As such, the panel stated, the new owners have “not properly preserved the issue” that they wished to litigate.

On Wednesday, the panel sent the case back to Blair County with instructions that they answer McDonnell’s lawsuit.

In a footnote to the opinion, the Superior Court indicated that it took the “extraordinary step” of contacting Blair County’s prothonotary to determine if the proper legal documents had somehow been lost due to a breakdown in the local court system.

The opinion concluded, “There was no breakdown in court operations.”

McDonnell, when contacted Thursday, stated, “I’m most happy for the opportunity to get justice.”

Siljander could not be reached for comment.