GT Advanced Creditors Object to Proposed Apple SettlementDawn McCarty
A committee of GT Advanced Technologies Inc. creditors objected to a proposed settlement with Apple Inc., saying the agreement doesn’t generate any revenue for the company, which went bankrupt months after reaching a supply agreement with the iPhone maker.
In a filing today in U.S. Bankruptcy Court in New Hampshire, the creditors’ committee said some terms of the settlement as proposed are “unacceptable.” A Dec. 10 hearing has been scheduled for court approval of the proposed settlement.
The accord stemmed from a deal GT reached with Apple last year to make the synthetic sapphire used to strengthen screens on mobile devices. After Apple chose another vendor for its latest iPhone, GT filed for bankruptcy in its home state of New Hampshire, listing more than $1 billion in debt.
Calling the settlement a “divorce” from Apple, the creditors said the failed venture cost almost $1 billion. They also said there wasn’t enough information to evaluate the agreement.
“It is left to the committee to try to determine which party is responsible for the failure of a billion-dollar project touted as a game changer for the debtors and whether a full release of Apple is in the best interest of the debtors’ estates and general unsecured creditors,” Steve Grill, a lawyer for the committee, told U.S. Bankruptcy Judge Henry Boroff in court papers filed today.
The creditors’ committee said it hasn’t completed its investigation into the propriety of the proposed settlement and isn’t in a position to conclude whether it’s fair and equitable. The committee filed the objection to reserve its rights in the meantime.
The case is In re GT Advanced Technologies Inc., 14-11916, U.S. Bankruptcy Court, District of New Hampshire (Manchester).
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