Union Tech USA Fails

An announcement on Union Tech’s USA website indicates they are shutting down their business.

The announcement, dated April 10, says that a trustee has been assigned to dispose of their assets in order to pay creditors. The trust assignment agreement says:

“WHEREAS, Union Tech is indebted to various persons, corporations, and other entities and is unable to pay its debts in full, has decided to discontinue its business, and is desirous of transferring its property to a trust to be administered by the Trustee/Assignee for the benefit of its creditors (‘Assignment’) so that the property so transferred may be expeditiously sold or liquidated and the proceeds thereof be fairly distributed to its creditors without any preference or priority, except such priority as established and permitted by applicable law;”

At first this may seem surprising: Union Tech is a well-known, global corporation based in China that has been supplying SLA-style 3D printing equipment to industry for over a dozen years. They may be China’s largest SLA 3D printer manufacturer, and that’s saying something. But there’s a lot more to this story.

The legal entity expiring here is not Shanghai Union Technology Corporation proper, but rather a US entity whose purpose was to market their equipment in the USA. Union Tech USA was first launched in 2016, when it became clear they could do so without legal ramifications from patents that had then just expired.

Things seemed to be going reasonably well for them in the USA, as Union Tech’s products are quite well regarded, but then something bad happened. Something very, very bad.

One of their key staff members was caught red-handed stealing customer lists from a competitor. The gist of the story was that 3D Systems’ former Director of Sales was recruited by Union Tech USA, but he brought with him to Union Tech 3D Systems’ list of 440,000 clients, prospects and leads.

This theft was discovered by 3D Systems in what must be one of the most ridiculous scenarios ever: the Sales Director had contracted with a data recovery firm to extract the client information from the file, but the contractor mistakenly copied all correspondence to the Sales Director’s old 3D Systems email address.

Which was being read by 3D Systems HR staff. Oops!

It’s quite a story, and we encourage you to read our piece on Union Tech stealing 3D Systems’ customer data.

It was a very strong case then, and it seems likely that the amount of settlement owed to 3D Systems as a result of the case exceeded their ability to pay. Hence bankruptcy.

But what happens now? There are a number of scenarios to consider.

First, Union Tech likely has clients using their equipment in the USA, which now does not have local support. I would imagine Shanghai Union Technology Corporation will figure out some method of providing support to existing clients through importing parts as required and organizing repair services through third parties.

Second, it is unlikely US-based companies will consider Union Tech as a strong option for future purchases, given the latest news.

Third, it is likely the expiring entity was an independent licensee of Union Tech technology in the USA. This is why it was affected rather than the main company in China. Because of this, it is highly likely that Union Tech will re-start operations with an entirely new licensee in the USA sometime in the future. But they’ll have to somehow get their purchasing prospects over this recent failure.

And they’ll have to ensure the licensee is a lot more careful.

Via Union Tech