Hon Hai Weizhou failed to build 10.5 generation LCD panel factory U.S. real estate developer breached contract

by:Kimeery     2021-05-30

It was reported on February 3 that Hintz Real Estate Development Company (Hintz) filed a lawsuit in the Racine County Circuit Court on the 2nd, accusing Hon Hai Technology Group of violating the conditions of the Wisconsin contract by failing to build 10.5 in the southeastern part of Wisconsin as agreed upon. For the LCD panel manufacturing plant, the local government has spent hundreds of millions of dollars to prepare the infrastructure for the plant.

This lawsuit was filed by Daniel Hintz, a resident of Caledonia, Wisconsin, and the Hintz Real Estate Development Company, representing Racine County and Monte Pleasant Village. , But also named Racine County and Mont Pleasant Village along with Hon Hai as the defendants.

Hon Hai’s statement stated that it will not comment on the lawsuit. 'Hon Hai continues to perform its financial obligations under the local development agreement and is proud to be the largest taxpayer in Mont Pleasant Village and Racine County.'

Racine County and Monte Pleasant Village issued a joint statement stating that they cannot comment on this lawsuit because it involves legal matters that are still pending. 'What we can say is that Hon Hai Technology Group continues to base The local development agreement fulfills its financial obligations and is already the largest taxpayer in Mont Pleasant Village and Racine County.”

The complaint filed by Sinz and Sinz Real Estate Development Company to the court stated that Hon Hai’s local manufacturing and construction employees recruited in southeastern Wisconsin “did not reach the contractual level.” The capital investment between Racine County and local villages also 'does not meet the contractually negotiated scale.'

The complaint states that Racine County and Mount Pleasant have invested US$200 million to acquire land, US$185 million to bury water and sewer pipes, and 12 million to develop roads to prepare for the plant .

According to the Wisconsin Public Radio report, the Sinz family of Caledonia, Wisconsin, a resident of Caledonia, Wisconsin, owns about 430 acres of land in Caledonia, next to the site where Hon Hai established a factory. In an interview in 2017, he said that he hopes that Hon Hai's successful establishment of a factory may significantly increase its real estate prices.

In 2017, after Wisconsin Governor Walker provided Hon Hai with more than US$3 billion in tax relief, Wisconsin obtained Hon Hai’s first plant in the United States. However, the scale of Hon Hai’s plant was subsequently reduced. The original plan to build a 10.5-generation LCD panel factory was downgraded to a 6-generation LCD panel factory, which specializes in the production of smaller screens for smartphones, tablet computers, and TVs.

According to the original agreement, if Hon Hai meets certain recruitment and capital investment thresholds, Wisconsin agreed to provide up to $2.85 billion in tax relief, but Wisconsin has not yet granted Hon Hai tax credits, but the local government has already noted Millions of dollars are being used to update infrastructure.

According to reports, Hon Hai and the Wisconsin Economic Development Corporation have been negotiating a new contract, and Hon Hai is willing to agree to 'in exchange for flexibility' with less tax credits. The technology news website 'TheVerge' published a long survey report in October last year, stating that the Hon Hai Weizhou Advanced LCD Panel Factory, which was praised by President Trump as the '8th Wonder in the World' when the construction started in 2018, now has its own factories. Almost all promises bounced back. The original LCD factory building shrank to one-twentieth. Hon Hai also obtained a change in the purpose of the building from 'manufacturing' to 'warehousing' in September last year. (Milwaukee Sentinel Daily)

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