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(Jabil); Xetel Corporation (Xetel); and Bull HN Information
Systems, Inc. (Bull HN).
Most of these unrelated subcontractors were located in the
United States; however, there were some exceptions. Lung Hwa was
a Taiwanese PCA manufacturer from which Compaq U.S. purchased
PCA's from 1990 through 1993, and Solectron had plants in the
United States and Malaysia. However, the Solectron plant in
Malaysia primarily manufactured simple PCA's for disk drives and
telephone headsets. The more complex Solectron boards were built
at the Solectron California plant because that plant was more
advanced.
Most of the unrelated subcontractors that did business with
Compaq U.S. between 1990 and 1993 used the same pick-and-place
equipment and test equipment as Compaq U.S. There were, however,
some exceptions. For example, Compaq U.S. tolerated the use by
Philips of non-Fuji equipment because Philips manufactured the
pick-and-place equipment that it used and was capable of
operating and repairing Philips equipment, alleviating potential
production concerns. Philips, however, later converted to Fuji
placement equipment. Lung Hwa used Panasert and Xetel used
Panasonic placement equipment rather than Fuji machines, but
Compaq U.S. ultimately terminated its business relationship with
both companies. Lung Hwa was unable to meet Compaq U.S.
production demands without exceeding quoted prices, and Xetel
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