City of New Hampton sued for defamation, breach of contract

The City of New Hampton is being sued by one of its largest employers for defamation, breach of contract and unjust enrichment.

Precision of New Hampton is suing the City of New Hampton and Public Works Director Casey Mai in U.S. District Court for the Northern District of Iowa.

Precision of New Hampton is a family-owned business that employes 250 people and describes itself as one of the world’s largest transmission parts suppliers. Dennis Hansen is the CEO of the company and Tyler Hansen is the company’s president of operations.

The lawsuit alleges that in mid-2022, Precision initiated plans to construct an addition to its existing building to increase the size of its manufacturing and distribution facility. On June 7, 2022, Tyler Hansen called Mai and advised him of the project and explained that he did not want to have any issues obtaining a building permit after he had invested money in the project.

The lawsuit claims Mai “gave express approval” for the building project and told Hansen the company would have “no problems” with the proposed project. Precision says it then allocated funds and ordered about $546,000 in materials for the construction of the new building addition, with plans to begin construction the last week of September 2022.

On Sept. 14, 2022, Tyler Hansen filed a building permit application with the city, estimating the value of the addition to be $650,000. Eight days later, the lawsuit claims, Mai wrote Precision a letter denying the requested permit “due to the interference that your proposed construction would cause to the city’s stormwater main.”

On Sept. 28, 2022, Tyler Hansen and the company’s lawyer allegedly reminded Mai he had given verbal consent for the project.

After regrouping and changing plans, the lawsuit claims, Hansen submitted a new building permit application seeking approval for pouring of cement and installation of new footings for a future building.

The second application was allegedly granted on the condition that the company contact Mai prior to pouring concrete to verify setbacks and the size of the concrete.

On Nov. 22, 2022, Mai allegedly emailed Tyler Hansen and issued a “stop work order” that directed Precision’s construction crew to halt their work immediately. Mai also is alleged to have sent emails to Tyler Hansen accusing him of being personally engaged in illegal conduct, stating, “You knew you were not allowed to pour any cement over this area, and it was even a condition on the building permit issued… You poured footings right over the top of the stormwater main.”

The company and the city later agreed that the storm sewer line could be relocated so as to not interfere with the Precision’s plans, with the cost of relocation estimated to be $125,000. The city then issued Precision its building permit.

However, a bid was never awarded for the pipe relocation work because the city elevation changes made that work impossible – although Precision moved ahead with its plans and completed construction of its proposed addition.

In September 2025, a city-hired engineering firm allegedly labeled Precision’s expansion as “unapproved” and recommended an upstream rerouting of the sewer line that runs under Precision’s property, with the cost of rerouting estimated to be $1.38 million to $4.76 million.

In January 2026, Tyler and Dennis Hansen and others attended a city stormwater committee meeting or work session to discuss the relocation of the storm sewer line. The lawsuit alleges that during the session, Tyler Hansen made a comment about potential flooding, prompting Mai to look in the direction of the Hansens and shout, “Liars!”

In February 2026, the city allegedly gave the company 60 days to come up with a storm water management plan for the city’s consideration and later indicated no additional building permits would be issued for the company’s property until the issue was resolved.

The company is now seeking unspecified damages for alleged breach of contract, defamation, denial of due process rights and other claims.

The City of New Hampton’s attorney, Todd Prichard, declined to comment on the lawsuit when contacted Wednesday by the Iowa Capital Dispatch.