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11/04/2024 01:16:51 pm

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Sapphire Screen Manufacturer Wants to Drop Apple Contracts

GT Advanced Technologies

(Photo : Facebook)

GT Advanced Technologies, Apple's supplier of sapphire screens for mobile devices, urged a bankruptcy court Friday to free it from its contracts with Apple it branded "oppressive and burdensome."

The manufacturer's sapphire touch screens are a very durable synthetic replacement for the glass currently used on a number of Apple's devices, and are already used for specifically fragile components of the devices.

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Apple's smartwatch, the Apple Watch, and some of the latest versions of iPhones are equipped with sapphire screens.

The United States-based screen manufacturer "believes that it has many claims against Apple arising out of its business relationship," lawyers for the firm said in paperwork filed in US Bankruptcy Court. "The agreements imposed oppressive and burdensome terms and obligations on GTAT."

The court was asked by GTAT if the company could wind down some of its synthetic sapphire manufacturing plants in two states to decrease an "ongoing cash burn" which threatens to eat the company's liquidity.

GTAT argued in the court papers the agreements benefit Apple, and changed the firm's business model from offering sapphire-manufacturing equipment to building the synthetic materials themselves.

The company has formally filed a petition for bankruptcy protection, bringing into question where Apple would turn to for its supply of the special touchscreens.

GTAT told the court that a meticulous evaluation had led the company to deduce that in order to safeguard its assets, it needs to wind down its sapphire facilities in Massachusetts and Arizona, and forgo supporting staff members in its offices in New Hampshire.

Ceasing the sapphire screen operations equates to the loss of 890 employees, according to the legal motion.

While Apple did not reply to an AFT request for its comment on the issue, the tech company has been quoted in press reports saying, Apple was "surprised" by GTAT's resolution filing for bankruptcy.

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