Challenges mounting to secrecy pact between Apple and GT

Some are still hoping for answers about the bewildering bankruptcy of Apple’s sapphire supplier, GT Advanced Technologies.

Media company Dow Jones urged U.S. Bankruptcy Judge Henry Boroff on Tuesday not to let Apple and GT keep details of their relationship under wraps. GT’s filing for Chapter 11 protection earlier this month stunned investors, but the New Hampshire-based company has yet to fully explain why it went under, saying it risks fines of $50 million per violation if it breaches its confidentiality agreement with Apple. Last week, Apple and GT reached a settlement that will allow GT to pay off its debt to Apple by selling sapphire furnaces, provided that documents detailing their relationship are never exposed.

But Dow Jones stressed that Apple and GT owe the public an explanation.

“Their request to maintain in place a seal that has never been justified and to permanently expunge critical public documents from the docket is… an offense to Constitutional principles of public access,” the company wrote in court papers filed Tuesday.

GT explained in court papers filed earlier this week that it settled with Apple because it could not afford a protracted legal battle with the tech giant.

“At a minimum, protracted litigation against one of the largest corporations in the world with over $100 billion of cash would be challenging and expensive and could significantly delay GTAT’s emergence from Chapter 11,” the company wrote in court papers.

Rather than quibbling in court, executives need to focus on creating the “new post-Apple GT,” the company wrote in court papers. GT must reestablish business relationships that went untended during the year that it was producing sapphire exclusively for Apple, GT added.

A hearing on the companies’ motion to seal is scheduled for Thursday in New Hampshire. In addition to Dow Jones, the U.S. Trustee and the state of New Hampshire have also balked at the secrecy surrounding the case.

Before its bankruptcy, GT was making sapphire for Apple’s electronics. (Justin Sullivan/Getty Images).


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  • Russell

    Apple called all of the shots in this failed venture.

    It was Apple that decided the buildout of the factory causing it to be late including the decision not to have backup generators. When it experienced power blackouts, the unfinished sapphire had to be scrapped and the growing process started all over again.

    It was Apple that decided which furnaces GTAT had to buy.
    It was Apple that specified the process to grow the sapphire and had their own people overseeing it at the factory.
    When the sapphire was finished, Apple did not buy it because it did not meet their standards so GTAT had to eat all the costs.

    Since Apple had complete control over every aspect of the venture you would think Apple would accept more responsibility for it’s failure and show GTAT some leniency instead of withholding the final loan installment or exercising accelerated repayment clauses.

    Read GTAT’s Bankruptcy Declaration describing the events leading up to the bankruptcy filing. It’s very telling to see how Apple treats their suppliers with such little regard http://www.kccllc net/gtat/document/1411916141028000000000004