Bitcoin mining company CoinTerra Inc. is in a spot of bother today with news that it is being sued by a Utah data center operator for breach of contract and failure to pay $1.4 million for services.

Bluffdale, Utah-based C7 Data Centers Inc. alleges that CoinTerra acted in bad faith by intentionally underpaying for services, and further demonstrated a pattern of late repayment.

All up C7 is seeking $5.4 million in damages, court fees and related charges.

Unconfirmed reports claim that CoinTerra has been in some trouble for some time, although the company at the time of writing appears to be continuing to trade.

C7 CEO Wes Swenson told Coindesk that the company had hoped to settle the issue without suing.

“We had filed suit against them, which is public, for non-payment over 60 days. So, their services were suspended with no attempt to solve that. We went ahead and filed suit for that non-payment, plus the breach of contract for the remaining contract” Swenson said.

CoinTerra responded to the legal action, saying that:

“CoinTerra, Inc. (“CoinTerra”) disputes the allegations in the complaint filed by C7 Data Centers, Inc. (“C7”) in Utah State court. CoinTerra has recently retained local counsel to address this dispute. Moreover, CoinTerra has filed a counterclaim against C7 in Federal Court in the District of Utah. CoinTerra intends to vigorously prosecute its claims against C7 while defending the claims levied by C7. Yet, CoinTerra is hopeful that the parties can resolve this matter quickly.”

It’s dark days for Bitcoin miners as the Bitcoin drops in price; as we reported in this weeks Bitcoin Weekly with the news of Bitcoin miner CEX.IO closing, the current sub $200 price of Bitcoin makes the cost of Bitcoin mining uneconomical.