Testing lab hit with $3.76m fine in falsified electronics case

New Jersey Micro-Electronic Testing (NJMET) has been given a heavy fine in a long-running legal dispute focusing on substandard components that found their way into the aerospace supply chain.

The case centres on more than 20,000 international rectifier (IR) transistors – a component of antiskid/autobrake control units used in Boeing 737 aircraft – that were purchased by electronic component distributor Electrospec from a Chinese supplier and were sent to NJMET for testing before being shipped to Hydro-Aire, a division of Crane Aerospace that makes brake control products.

Around 13,000 parts (JANTX2N6901) were ultimately shipped to Hydro-Aire, on the understanding that visual checks and testing had been carried out to show they were in good order. However, Hydro-Aire's own testing revealed some parts used in the IRs were not new and did not meet specifications, according to a blog post from industry supply chain association ERAI Inc.

A lawsuit filed in 2014 by Electrospec against NJMET came to a conclusion late last month, with the testing company found to be in breach of contract and having committed fraud for failing to carry out the testing they were contracted to do and falsifying lab reports.

None of the components ever found their way into airplanes, but Electrospec claimed in the suit that it had lost millions of dollars in business after the Federal Aviation Authority (FAA) launched an investigation into the incident.

In 2012, the FAA released Unapproved Parts Notification Number 2012-20111108011 which concluded that the transistors were "not traceable to an approved manufacturer" and most likely "reclaimed, refurbished and distributed as new."

The ERAI blog suggests the case could have implications for other organizations that relied on NJMET testing, saying "the 'ripple effect' may look more like a tsunami."