Jing Ji Guan Cha Wang·2025-05-21 06:16Core Viewpoint - A legal dispute involving a contract worth 114 million yuan between Bluestar Technology and Sandam Membrane has raised concerns about contract performance risks in the lithium extraction industry chain [2][3]. Group 1: Background of the Dispute - The lawsuit originated from a contract signed in March 2022 for the supply and installation of lithium carbonate adsorption equipment, valued at 114 million yuan, which accounted for 9.54% of Bluestar Technology's 2021 revenue [3]. - Disagreements escalated during the project, leading Bluestar Technology to freeze 58.61 million yuan of Sandam Membrane's assets due to non-payment, prompting Bluestar to file a lawsuit for 47.44 million yuan in contract payments and penalties [3]. - Sandam Membrane counter-sued, claiming Bluestar failed to meet installation deadlines and provided non-compliant equipment, seeking approximately 38.73 million yuan in damages [3]. Group 2: Court Ruling - On May 8, 2025, the court ruled in favor of Bluestar Technology, ordering Sandam Membrane to pay 48.2869 million yuan plus overdue penalties, while dismissing all counterclaims from Sandam [4]. - The court found that Bluestar had fulfilled its contractual obligations, and Sandam's claims regarding delays and equipment quality were unsupported due to insufficient evidence [4]. Group 3: Industry Context - The lawsuit reflects a broader downturn in the lithium extraction industry, where lithium carbonate prices plummeted from 590,000 yuan per ton in 2022 to around 65,000 yuan per ton in 2023, leading to project viability concerns [5]. - The industry is facing prolonged overcapacity and extended expansion cycles due to falling prices [5]. Group 4: Financial Impact - The ongoing litigation has materially affected the financial health of both companies. Bluestar Technology's revenue from lithium extraction systems dropped to 99 million yuan in 2024, a decline attributed to project confirmation delays [7]. - Sandam Membrane is experiencing severe cash flow issues, with a 78.38% year-on-year decline in net cash flow from operating activities, amounting to 12.1899 million yuan in Q1 2025 [7]. - Additionally, Sandam is facing further financial strain from another arbitration case involving 34.09 million yuan [7]. Group 5: Future Implications - Sandam Membrane plans to appeal the ruling, which could lead to a second trial. A favorable outcome for Bluestar could help confirm project revenues and alleviate financial pressures, while a successful appeal for Sandam could mitigate losses [8]. - The dispute highlights the need for clearer risk-sharing mechanisms and enhanced compliance monitoring in the lithium extraction industry to ensure healthy future development [8].