GT asks court if it can close Mesa factory; company considers suing Apple
Apple had agreed to prepay GT $578 million to help the company equip the factory with the necessary machinery. Earlier this week, it was disclosed that Apple had paid GT $440 million. While some questioned whether Apple had put GT in bankruptcy by not paying it the full amount, it turns out that Apple had been working with its partner to overcome certain issues that prevented GT from reaching certain milestones. Under the terms of the contract between both companies, Apple was going to pay GT the remaining $138 million if certain goals were met.
Due to low yields from the finishers, Apple decided not to use the sapphire glass for its new models, opting to go with its hardened-ion glass. Apple did use the sapphire already produced, for the Apple Watch. Meanwhile, Apple still employs sapphire on its Touch ID fingerprint scanner and the rear-facing iSight camera on the iPhone. While the manufacturer was hoping to launch the Apple Watch in February, we could see further delays as Apple seeks a new partner to supply it with the material.
Bankruptcy Judge Henry Boroff will hold a hearing on GT's motion to close the plant, on October 15th. The hearing will take place in Springfield, Mass. Under Chapter 11, a company is allowed to continue operating while it is protected from its debt. The Mesa facility has 890 workers, and is losing $1 million a day.
GT could decide to take Apple to court as the company blames the tech titan for its problems. "GT believes that it has many claims against Apple arising out of its business relationship with Apple," reads GT's filing with the bankruptcy court.
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