Hypertherm supplier drops demand

A legal dispute between Hanover-based Hypertherm Inc. and a key supplier that shut down a product line appears to have been resolved.

ACT Electronics Inc., the Massachusetts-based sole supplier of circuit boards for which Hypertherm had already paid, shipped the crucial control boards, dropping its demand that Hypertherm pay $250,000 upfront to ease ACT’s credit crunch, Hypertherm spokesperson Michelle Avila told NHBR.

Without those control boards, Hypertherm was unable to manufacture two types of plasma torches, costing it $47,000 a day and the loss of market share, according to a suit filed Oct. 6 in U.S District Court in Concord.

But by Oct. 9, Hypertherm received the boards, and production resumed that night.

According to the lawsuit, ACT – citing financial difficulties – in September demanded that Hypertherm pay upfront despite a master contract with credit terms.

Hypertherm agreed, but then ACT held back about $44,000 worth of equipment that was already paid for until Hypertherm paid another $250,000 for future orders.

Hypertherm refused and demanded its blueprints, test platforms fixtures and tooling back, charging that ACT – as the sole supplier of the crucial boards – was engaged in “extortion.”

Avila did not release the terms of the settlement, which was not finalized by deadline in federal court, but she said ACT agreed to continue to fill purchase orders and dropped the $250,000 demand. She also said that Hypertherm has identified another supplier if needed in the future.