GT Advanced Technologies (GTAT), Apple’s sapphire screen supplier for mobile devices, has announced it will shut down its sapphire manufacturing facility in Arizona, resulting in a loss of 890 jobs.
Last week, the company had filed for bankruptcy and had announced that it could pursue a legal battle against Apple over “oppressive and burdensome” contract terms.
“GTAT believes that it has many claims against Apple arising out of its business relationship. The agreements imposed oppressive and burdensome terms and obligations on GTAT,” the lawyers for GTAT said in the paperwork filed in the US Bankruptcy Court.
The company on Friday pleaded that only if it winds down operations in Massachusetts and Arizona facility, it would be able to restrict mounting losses and re-focus its resources on the operation of its core business of selling sapphire furnaces and other products.
The US-based screen manufacturer claimed it is mounting more than $1 million (£620,000) per day in losses.
GT added that voluntary bankruptcy will allow it to terminate several Apple agreements that it said were burdensome and of no value. The company has asked the bankruptcy court to end 13 contracts with Apple, including a confidentiality agreement that has forced the bankruptcy to be conducted with unusual secrecy.
Apple responded saying that it is currently working on to preserve Arizona jobs and that talks with the state and local officials in this regard are on.
A hearing on GT Advanced’s requests is scheduled to take place on Wednesday in Springfield, Massachusetts.
