Jury Says Circuit Board Maker Owes US Distributor $7.6M

Posted on October 31, 2023
Stephen F. Rosenthal Partner
Stephen F. Rosenthal
Matthew P. Weinshall Partner
Matthew P. Weinshall
Christina H. Martinez
Christina H. Martinez

Law360 (October 27, 2023, 5:28 PM EDT) —By Alyssa Aquino

Federal jurors in Florida have ordered a Chinese circuit board manufacturer to pay its U.S. distributor nearly $7.6 million in damages after hearing testimony that the manufacturer exploited its partner once it hit rough financial straits.

The federal jury found this week that Jiangmen Benlida Printed Circuit Co. Ltd., referred to throughout the trial as Benlida, had breached a distribution agreement with Circuitronix LLC, costing it millions of dollars.

The verdict caps off a yearslong legal saga that began with Benlida filing its own breach of contract claims against the distributor, referred to as CTX, according to Stephen Rosenthal, counsel for CTX.

“I was really impressed by the jurors’ attention to what was a fairly detailed and tedious body of evidence about two companies doing business together over a decade, and it gave me renewed faith in the jury system,” Rosenthal said Friday.

The verdict was delivered on Tuesday.

In 2012, Benlida and CTX entered into a manufacturing agreement under which CTX would send circuit board designs to Benlida for manufacturing. The finished products were then sent back to the U.S. for distribution.

But in June 2021, Benlida accused CTX of skipping out on $13.7 million worth of circuit board invoices. CTX denied Benlida’s claims and countersued, arguing that it was Benlida that owed CTX millions of dollars.

In filings to the court, CTX argued that Benlida demanded advance payments for the circuit boards but failed to properly credit payments to its account. Additionally, Benlida had sent out shipments late, incurring late fee penalties that further spiked its outstanding debt, CTX claimed. Before the jury, CTX’s attorney, Rosenthal, argued that the debt stemmed from cash flow problems on Benlida’s part, saying the manufacturer had improperly relied on CTX to solve them.

Months before the trial, CTX asked the Florida federal court to dispose of Benlida’s suit, arguing that nearly half of the invoices belonged to an affiliate, Circuitronix (Hong Kong) Ltd. CTX claimed responsibility for the remaining invoices but argued that it had already settled those payments in full.

U.S. District Judge Robert Scola Jr. sided with CTX, agreeing with CTX that it couldn’t be held accountable for services charged by CTX Hong Kong. Moreover, “the undisputed facts show … that Circuitronix actually did pay Benlida for the invoiced amounts,” he said.

Counsel for Benlida didn’t respond Friday to a request for comment.

Benlida is represented by Jean-Claude Mazzola and Richard E. Lerner of Mazzola Lindstrom LLP.

CTX is represented by Stephen F. Rosenthal, Matthew P. Weinshall and Christina H. Martinez of Podhurst Orseck PA.

The case is Jiangmen Benlida Printed Circuit Co. Ltd. v. Circuitronix LLC, case number 0:21-cv-60125, in the U.S. District Court for the Southern District of Florida.

–Additional reporting by David Minsky. Editing by Rich Mills.