Music equipment maker Ultimate Support Systems sues manufacturer

Editor’s note: This story was updated after initial publication with a response from Reliance International.

FORT COLLINS — Music equipment manufacturer Ultimate Support Systems is suing its manufacturer in Taiwan, alleging a series of poorly designed microphone stands have cost the company more than $3 million in lost sales.

In the complaint filed with the U.S. District Court of Colorado on Friday, Ultimate Support levied a wide range of allegations against Reliance International Corp., a Taipei-based specialty manufacturer with factories in China.

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Ultimate Support said it began its relationship with Reliance 10 years ago by contracting it as a maker of its various audio-visual devices and spending more than $115,000 to prepare custom tooling.

Ultimate Support makes equipment such as microphone stands, acoustic paneling and audio-visual equipment. It is registered in Fort Collins with the Colorado Secretary of State’s office but maintains a warehouse in Loveland near Northern Colorado Regional Airport.

In 2015 in particular, the company said it hired Reliance to make a new series of microphone stands. Ultimate claims Reliance misrepresented its ability to build the parts to specifications, leading to delays of up to two years for some stands to customers and widespread defects.

The company also claims it spent more than $20,000 in trips to the Chinese factories for quality inspections.

Reliance allegedly cancelled its contract with Ultimate in October 2018, claiming it couldn’t produce the stands after all. Ultimate claims that cancellation cost the company more than $3 million in sales that year and incurred additional costs in finding a new manufacturer.

Ultimate later claimed that during last March, Reliance asked it to make good on $300,000 in unpaid invoices. The two companies allegedly agreed to a repayment plan on top of shipments, but Ultimate claims Reliance reneged on the agreement last October and demanded either $25,000 in repayments per shipment or the whole invoice in full.

Ultimate goes on to claim that Reliance has refused to return the custom tooling equipment provided by the Fort Collins company and is refusing to accept returns for defective products.

The company is requesting a jury demand Reliance pay for lost revenues and equipment along with other monetary damages as seen fit.

BizWest was unable to contact Reliance initially but its attorneys later offered a response.

“It is with regret that after a good working relationship of more than 10 years with Ultimate, Reliance had no option but to file legal proceedings to recover significant debts owed to it by Ultimate, many more than 18 months and some many years old. Only after Reliance sought payment of these longstanding  debts, and only after Reliance notified Ultimate of its own legal claim against it, did Ultimate proceed to file its own legal claim. The legal complaint by Ultimate is reactive and opportunistic, and the allegations made in Ultimate’s claim are spurious, unfounded and will be robustly defended.” 

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