Apple Sapphire Supplier GT Advanced Cannot Disclose Bankruptcy Details

Apple Sapphire Supplier GT Advanced Cannot Disclose Bankruptcy Details

By Julie S julie.s@hngn.com | Oct 10, 2014 05:45 PM EDT

GT Advanced Technologies Inc. has recently filed for bankruptcy and has been asked by the court to keep the details confidential.

U.S. Bankruptcy Judge Henry Boroff ruled on Thursday that the Apple sapphire supplier may not disclose the details regarding its problems with the iPad maker. The company has filed for bankruptcy protection after Apple released its new iPhones, which didn't include synthetic sapphire made by the company.

Losing Apple came as a blow for GT Advanced, as the sapphire business accounts for more than 75 percent of the company's revenue. GT Advanced suffered from a net loss of $86.4 million for the second quarter of this year. Stocks took a dive by 90 percent, hitting shareholders hard.

Apple and GT Advanced had a closed door meeting in which both parties agreed to keep the arrangement confidential. The judge also allowed GT to protect court documents that carry information of the company's financial problems and supply deal with Apple.

Luc Despins, lawyer for GT, told the Wall Street Journal that the company is 'tied up in knots with confidentiality agreements,' and will not be able to provide details regarding this crisis.

Aside from keeping court documents private, the judge also ordered GT to file for emergency motions to recuperate the production of the sapphire parts. A hearing specific to this issue is set for Oct.15 in Springfield, Massachusetts.

Apple refused to comment about the issue, but stated that it is working to preserve the jobs of affected employees. Closing the Arizona and Massachusetts sapphire plants will affect 890 people.

'We are focused on preserving jobs in Arizona following GT's surprising decision and we will continue to work with state and local officials as we consider our next steps,' Apple said in a statement.

Some were not happy with the non-disclosure agreement between the two parties, especially on GT Advanced's part. In addition, the company might face class action suit for misleading its shareholders on last year's financial status.

'The record is insufficient for the court to find what the court needs to find,' said Ann Marie Dirsa, a lawyer from the Office of the U.S. Trustee, to Reuters.