REG - Dialight PLC - Sanmina Litigation

DialightAnnouncement

29/11/2023 13:15

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RNS Number : 1010V  Dialight PLC  29 November 2023

Dialight plc ("Dialight")

Sanmina litigation

As reported previously, Dialight has been involved in ongoing litigation with
its former manufacturing partner, Sanmina Corporation ("Sanmina") in relation
to the termination of a manufacturing services agreement.  Both parties
issued formal legal proceedings in December 2019 and Sanmina lodged a motion
for summary judgment to dismiss certain elements of Dialight's claims and
counter-claims.

The Court's ruling on Sanmina's dismissal motion (with pleadings first filed
on 2 May 2022) was released to the parties under seal on Tuesday 14 March 2023
(the "First Judgment").  The notification of this ruling is available at
https://ecf.nysd.uscourts.gov (https://ecf.nysd.uscourts.gov) and is also
available on request from Dialight (email: ir@dialight.com
(mailto:ir@dialight.com) ).  In the First Judgment, the court denied
Sanmina's motion to dismiss Dialight's fraudulent inducement claim and denied
its motion for summary judgment on Sanmina's accounts receivable claim.

Sanmina subsequently filed a motion of reconsideration seeking the reversal of
the judge's denial of summary adjudication of Sanmina's $5.3m accounts
receivable claim.  The Court's ruling on Sanmina's motion for reconsideration
was released to the parties under seal on 28 November 2023 (the "Second
Judgment").

In the notification of the Second Judgment, the court: (a) stated that it was
granting the motion for reconsideration solely to the extent that the Court's
prior opinion could be construed as finding that certain evidence established
as a matter of law that Dialight timely rejected invoices comprising Sanmina's
accounts receivable claim; (b) stated that otherwise Sanmina's motion for
reconsideration was denied; and, (c)  affirmed its prior opinion denying
Sanmina's motion for summary judgment on its accounts receivable claim.

The fraudulent inducement claim, together with various claims and
counter-claims relating to excess and obsolete inventory, accounts receivable
and accounts payable, are now expected to proceed to trial  (pending any
further motions, appeal processes and/or mediation), and Dialight intends to
continue to rigorously pursue its claims.

If Dialight's claims are successful at trial, the range of outcomes could
include the payment by Sanmina to Dialight of between $0 and c. $220m
(excluding legal costs and judicial interest).  If Sanmina's claim is
successful at trial the range of outcomes could include the payment by
Dialight to Sanmina of between $0m and $8.3m (excluding legal costs and
judicial interest).

Fariyal Khanbabi, Dialight's CEO, commented:

"I am pleased that yet again the court has denied  Sanmina's effort to obtain
summary judgment and we now look forward to seeing it proceed to a
satisfactory conclusion."

 

Contacts:

Dialight plc

Tel: +44 (0)203 058 3542

Fariyal Khanbabi - Group Chief Executive

Richard Allan - General Counsel & Company Secretary

 

About Dialight:

Dialight (LSE: DIA.L) is a global leader in sustainable LED lighting for
industrial applications. Dialight's LED products are providing the next
generation of lighting solutions that deliver reduced energy consumption and
create a safer working environment. Our products are specifically designed to
provide superior operational performance, reliability and durability, reducing
energy consumption and ongoing maintenance and achieving a rapid return on
investment. The company is headquartered in the UK with operations in
Australia, Dubai, Germany, Malaysia, Mexico, Singapore, the UK and the USA.
www.dialight.com.

 

Notes:

1.  This announcement includes inside information as defined in Article 7 of
the Market Abuse Regulation No. 596/2014 (which forms part of domestic UK law
pursuant to the European Union (Withdrawal) Act 2018) and is disclosed in
accordance with the Company's obligations under Article 17 of those
Regulations. On the publication of this announcement via a Regulatory
Information Service ("RIS"), this information is considered to be in the
public domain.

2.  The person responsible for making this announcement is Richard Allan,
General Counsel & Company Secretary of Dialight plc

 

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