Microsoft contends that Hon Hai has continuously failed to honor its obligations under the contract.

“For example, for over three years Hon Hai has failed to submit the royalty reports required by the agreement, and Hon Hai has refused to cooperate with the contractually required audit by an independent public accountant, all in breach of the agreement,” the complaint states.

The complaint goes on to state that in March 2018 “Microsoft formally invoked the dispute resolution provision of the agreement. During negotiations that followed over many months, Hon Hai continued its refusal to allow an audit and refused to provide Microsoft with any information concerning its manufacture or sales of covered products or to engage in any way concerning the amount of historical royalties it owed under the agreement.”

Instead, Microsoft said, Hon Hai has tried to renegotiate the contract.

It appears Microsoft has a lack of trust with Hon Hai; in the suit it states that “court-supervised discovery of Hon Hai books and records, including document and written discovery and witness examinations under oath, is therefore necessary to ensure Hon Hai compliance with the agreement’s provisions and to ensure an accurate determination of the total amounts due under the agreement for each royalty period.”