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UNITED STATES DISTRICT COURT 

EASTERN DISTRICT OF MICHIGAN 

NORTHERN DIVISION 

Hemlock Semiconductor Corporation, 

Plaintiff, 

-againstJinglong Industry and Commerce Group Co., 

Ltd., 

Defendant. 

Case No. 15- 

Hon. Thomas L. Ludington 

COMPLAINT 

JURY TRIAL DEMANDED 

COMPLAINT 

 Plaintiff Hemlock Semiconductor Corporation (“Hemlock” or “Plaintiff”), for its 

Complaint against Jinglong Industry and Commerce Group Co., Ltd., (“Jinglong” or 

“Defendant”), alleges as follows: 

PARTIES 

1. Hemlock is a Michigan corporation with its principal place of business at 12334 

Geddes Road, Hemlock, Michigan 49626. 

2. Jinglong is a Chinese limited corporation, whose principal place of business is 

located at NingJin Higher and New Technology Development Area, 055550 Hebei, China. 

3. Hemlock and Jinglong were parties to a certain Long Term Supply Agreements II 

and III, as amended, effective as of July 3, 2006 and June 18, 2007, respectively (together, the 

“Supply Agreements II and III”), out of which the claims in this Complaint arise, and pursuant to 

which Hemlock was obligated to manufacture solar grade polycrystalline silicon that Jinglong 

was obligated to purchase. 

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JURISDICTION AND VENUE 

4. Jurisdiction is proper in this Court under 28 U.S.C. § 1332. Complete diversity of 

citizenship exists between the parties, and the amount in controversy exceeds $75,000. 

5. Jinglong is subject to personal jurisdiction in this Court because it consented to 

the exclusive jurisdiction and venue of the U.S. District Court for the Eastern District of 

Michigan in Supply Agreements II and III. In addition, and independent of that consent, 

Jinglong has done and is doing business in the state of Michigan. 

6. In addition, and independent of that consent, on information and belief, Jinglong 

has transacted business in the state of Michigan. 

7. Venue is proper under 28 U.S.C. § 1391(b). Hemlock resides in the Eastern 

District of Michigan, and a substantial portion of the events giving rise to Hemlock’s claims took 

place there. Further, Jinglong consented to the exclusive jurisdiction and venue of the U.S. 

District Court for the Eastern District of Michigan in Supply Agreements II and III. 

FACTS 

8. Hemlock is a leading manufacturer of polycrystalline silicon that is used, inter 

alia, in the manufacturing of photovoltaic wafers, ingots, solar cells, and solar modules. 

9. Upon information and belief, Jinglong is principally engaged in the 

manufacturing and distribution of solar grade solar cell and semiconductor device grade silicon 

products.

The Parties Enter Into Supply Agreements II and III 

10. On or about July 3, 2006, the Parties entered into Supply Agreement II, pursuant 

to which Jinglong agreed to purchase, and Hemlock agreed to supply, solar grade polycrystalline 

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silicon (the “Product”). On or about June 18, 2007 the Parties entered into Supply Agreement 

III, pursuant to which Jinglong agreed to purchase, and Hemlock agreed to supply, the Product. 

11. Pursuant to Supply Agreements II and III, Jinglong agreed to purchase specified 

quantities of Product for a period of years, pursuant to an annual schedule, at specific prices. 

12. Jinglong also agreed in Supply Agreements II and III that it would “take or pay” 

for the Product, such that Jinglong was “absolutely and irrevocably required” to pay the full 

purchase price of the Product scheduled for each year (the “Contract Quantity of Product,”) 

regardless of whether Jinglong opted to order or take delivery of the Product. 

13. The term of Supply Agreement II was to run from July 3, 2006 through December 

31, 2018, with delivery of Product to begin in 2009. The term of Supply Agreement III was to 

run from June 18, 2007 through December 31, 2019, with delivery of Product to begin in 2010. 

14. Hemlock fully performed and complied with all of its obligations under Supply 

Agreements II and III. 

Defendant’s Breach and Plaintiff’s Termination of Supply Agreements II and III 

15. Section 5 of Supply Agreements II and III states: 

“This Agreement is a ‘take or pay agreement’ such that Buyer is 

absolutely and irrevocably required to accept and pay for the contracted 

volume [of Product] per year over a 10-year period at the prices set forth 

in Exhibit B, subject to the adjustments described in Section 4 above. In 

the event that Buyer fails to order and take delivery of its contracted 

volume in a given year, HSC shall invoice Buyer for the differential at full 

contract price and Buyer will pay the same within 30 days of invoice date. 

Buyer specifically acknowledges and accepts that it will be liable for the 

full purchase price of volume differential between the quantity ordered 

and the contracted volume.” 

16. Jinglong did not order or take delivery of the full Contract Quantity of Product for 

the calendar year 2012 under Supply Agreements II and III. 

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17. Jinglong did not order to take delivery of the full Contract Quantity of Product for 

the calendar year 2013 under Supply Agreements II and III. 

18. Jinglong did not order or take delivery of the full Contract Quantity of Product for 

the calendar year 2014 under Supply Agreements II and III. 

19. On August 16, 2013 Hemlock issued a Shortfall Notice and Invoice notifying 

Jinglong of its obligation to pay for the Contract Quantity of Product for the year 2012 under 

Supply Agreement II and Supply Agreement III in the amounts of $2,964,000.00 and 

$15,504,000.00, respectively, on or before September 15, 2013. 

20. Jinglong did not pay Hemlock the amounts set forth in the August 16, 2013 

Shortfall Notice and Invoice by September 15, 2013, and indeed has never paid these amounts to 

Hemlock. Jinglong did not dispute these amounts. 

21. On January 23, 2014 Hemlock issued a Notice of Default and Shortfall Invoice 

notifying Jinglong that it had failed to pay the $18,468,000.00 identified in the August 16, 2013 

Shortfall Notice and Invoice by September 15, 2013, and further notifying Jinglong of its 

additional obligation to pay for certain Contract Quantity of Product for the year 2013 under 

Supply Agreement II and Supply Agreement III in the additional amounts of $11,412,000.00 and 

$54,792,000.00, respectively, on or before February 22, 2014. 

22. Jinglong did not pay Hemlock the amounts set forth in the January 23, 2014 

Notice of Default and Shortfall Invoice on or before February 22, 2014, and indeed has never 

paid these amounts to Hemlock. 

23. On March 13, 2015 Hemlock issued a Notice of Default and Shortfall Invoice 

notifying Jinglong that it had failed to pay the amounts identified in the August 16, 2013 and 

January 23, 2014 Notices of Default, and further notifying Jinglong of its additional obligation to 

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pay for contracted Product quantities for the year 2014 under Supply Agreement II and Supply 

Agreement III in the additional amounts of $11,112,000.00 and $53,352,000.00, respectively, on 

or before April 10, 2015. 

24. Jinglong did not pay Hemlock the amounts set forth in the March 13, 2015 Notice 

of Default and Shortfall Invoice on or before April 10, 2015, and indeed has never paid these 

amounts to Hemlock. 

25. To date, Jinglong has not paid Hemlock any of the invoiced defaulted amounts 

due under Supply Agreements II and III. 

26. Section 10(b) of Supply Agreements II and III states: 

“Termination by HSC. HSC may, at its option, terminate this Agreement in the 

event of a failure to pay or other material breach by Buyer if that breach is not 

cured by Buyer within one hundred eighty (180) days after receipt of written 

notice. In the event of a termination due to Buyer’s breach, in addition to all 

damages that can be established by HSC, Buyer shall be liable to HSC for the 

purchase price of Products as set forth in Paragraph 5.” 

27. On March 31, 2015 Hemlock terminated Supply Agreements II and III in accord 

with Section 10(b) of Supply Agreements II and III. 

COUNT I 

BREACH OF CONTRACT 

28. Hemlock realleges each of the allegations in paragraphs 1 – 27 above as though 

fully set forth herein. 

29. Supply Agreements II and III are valid, binding agreements between the parties, 

which agreements Defendant has breached, by failing to pay amounts owed. 

30. Hemlock has fully performed and complied with all of its obligations under 

Supply Agreements II and III. 

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31. Supply Agreements II and III require Jinglong to “take or pay” for the Product, 

such that Jinglong is “absolutely and irrevocably required” to pay the full purchase price for the 

Product scheduled to be purchased each year, regardless of whether Jinglong actually takes 

delivery of the Product. Jinglong materially breached Supply Agreements II and III by failing to 

do so. 

32. Supply Agreements II and III further provide that “[i]n the event of a termination 

due to Buyer’s breach, in addition to all damages that can be established by HSC, Buyer shall be 

liable to HSC for the purchase price of Products as set forth in Paragraph 5.” 

33. Supply Agreements II and III were terminated on March 31, 2015.

34. As a result of Jinglong’s breach, Hemlock has suffered and will continue to suffer 

damages. 

COUNT II 

ACCOUNT STATED 

35. Hemlock realleges each of the allegations in paragraphs 1 – 27 above as though 

set forth fully herein. 

36. Hemlock sent invoices and notices to Jinglong for certain amounts due under 

Supply Agreements II and III, the charges on which Jinglong has not disputed. 

37. Hemlock has made demands for payment on numerous occasions, setting forth 

specific accounts for certain amounts due. 

38. At no time has Jinglong disputed or objected to said accounts in whole or in part. 

39. Jinglong has not paid said accounts in whole or in part. 

40. By reason of the foregoing, Hemlock has been damaged to date in an amount to 

be determined at trial, but in any event not less than $448,075,008 ($69,020,464.00 and 

$379,054,544.00, in connection with Supply Agreements II and III, respectively). 

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PRAYER FOR RELIEF 

 WHEREFORE, Hemlock demands: 

 1. Judgment in favor of Hemlock and against Jinglong on all Counts; 

 2. Damages in an amount to be proved at trial, including pre-award and post-award 

interest; 

3. Attorney fees and costs in accordance with Section 26 of Supply Agreement II 

and Section 25 of Supply Agreement III; and 

 4. Such other relief at law or equity as the Court deems just and proper. 

JURY DEMAND

 NOW COMES Plaintiff, by and through its attorneys, Braun Kendrick Finkbeiner P.L.C. 

and hereby demand a trial by jury on all issues so triable in the above-entitled matter. 

 BRAUN KENDRICK FINKBEINER P.L.C. 

DATED: July 14, 2015 By:____s/Craig W. Horn____________________ 

 Craig W. Horn (P34281) 

 4301 Fashion Square Boulevard 

 Saginaw, MI 48603 

 (989) 498-2100 

 crahor@bkf-law.com

 P34281 

 Of Counsel: 

 ORRICK, HERRINGTON & SUTCLIFFE LLP 

 J. Peter Coll, Jr. 

 John Ansbro 

 Alvin Lee 

 Thomas N. Kidera 

 51 West 52nd Street 

 New York, NY 10019 

 (212) 506-5000 

 Attorneys for Plaintiff Hemlock Semiconductor 

 Corporation 

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