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Apple, graphics card supplier locked in contract dispute

Imagination Technologies Group, a tech hardware company, disputes Apple's version of events when Apple said that they had informed Imagination over the last couple of years that they were "winding down" the relationship between the two companies. Apple previously used Imagination's graphics cards in their phones, but the announcement of the end of the relationship by the beginning of 2018 dealt a huge blow to Imagination's stock price.

Apple says they have been winding down the relationship with Imagination since 2015 and that in February of this year they officially informed Imagination that by early 2018, the relationship would be over. Imagination was surprised by the February news, and there are now questions about Imaginations efforts to inform their investors. The two companies have been partners since 2007.

It will be interesting to see where things go from here. Imagination disputes Apple's version of events and maintain that they are surprised by the news. If the dispute gets serious, Imagination could file a lawsuit against Apple -- which would be just another one on the pile for the tech giant -- alleging breach of contract. At this moment in time, though, that step hasn't been taken.

Contract disputes and breach of contract incidents happen all the time between companies. It is the nature of doing business. Sometimes, a partnership or deal doesn't work out in the way the two sides saw it unfolding. Handling such a dispute properly is crucial.

Source: Bloomberg, "Apple Fires Back at Supplier Imagination in Contract Dispute," Adam Satariano, July 7, 2017

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