Wednesday, September 27, 2023
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Samsung Sues Alcoa for $202 Million

MANHATTAN (CN) - Trying to elbow out competition for a $10 billion aluminum manufacturing plant in Saudi Arabia, Alcoa committed "egregious corporate misconduct," including "intimidation, racist insults and threats of assault," Samsung Engineering claims in court.

Samsung Engineering Co. and Samsung Saudi Arabia Co. sued Alcoa on March 29 in Manhattan Supreme Court, demanding at least $202 million.

Alcoa and Saudi Arabia's national company Ma'aden in December 2009 entered into a 30-year deal to construct a bauxite mine, aluminum refinery and smelter and rolling mill in the country's industrial area of Ras Al Khair, according to the 27-page complaint.

Samsung says it signed contracts with Ma'aden a year and a half later for $1 billion in engineering and procurement services for the projects. Samsung says it followed through on its commitments, but Alcoa botched its own job and tried to pass the buck.

"In order to cover up its own failures, deflect blame for its misdeeds and unjustly line its own pockets, Alcoa engaged in a campaign of malicious misrepresentations and improper interference with Samsung's contracts and Samsung's performance of its obligations," the complaint states.

Samsung claims that Alcoa "manufactured pretextual breaches" and encouraged "a third party to wrongfully terminate its contracts."

Engaging in behavior "far beyond what could be considered acceptable workplace conduct anywhere," Alcoa employees called Samsung managers "monkey" and "idiot" and "even went so far as to throw a large binder of paper in the face" of another manager, according to the complaint.

Samsung demands at least $202 million for tortious interference and unfair competition.

It is represented by Robert Friedman with Sheppard, Mullin, Richter & Hampton.

An Alcoa spokeswoman declined to comment.

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