The company reportedly filed for court protection after being unable to make a US$27m interest payment.

The group includes Pacific, Scotia Pacific Co, Britt Lumber Co and Scotia Development, which combined employ more than 500 people.

Pacific claims the state has contravened the Headwaters Agreement, which saw the state and federal governments acquire ancient redwood forest from the company in a US$480m deal. Pacific had agreed to limit felling on its remaining land as part of the deal but maintains that environmental restrictions had increased costs and reduced timber harvesting levels.

The company also grows and mills Douglas fir.