Clifton's NJ Micro-Electronic Testing sued over bad plane brakes

http://www.northjersey.com/news/clifton-s-nj-micro-electronic-testing-sued-over-bad-plane-brakes-1.1265108

CLIFTON — An electronics testing lab is for a second time the subject of a lawsuit that alleges the company produced false test reports for products that it said were properly working.
New Jersey Micro-Electronic Testing Inc. of Clifton is being sued by a distributor in Dover that sold thousands of airplane brake parts judged by the lab to be functional but that later proved to be defective.
Electrospec, the parts distributor, claims in its suit that the testing lab improperly tested the brake parts or never performed the tests, and that it falsified the test reports. A similar claim was made in 2005 by a former lab employee who said his superiors directed him to fabricate test reports, but the company said those allegations were not proved.
In the new case, none of the flawed brake parts were installed in airplanes, but the fallout for Electrospec was massive, said Darren Summer, the company's vice president. After an investigation by federal inspectors, he said, the company lost millions of dollars in business and was forced to shrink its workforce of 30 employees to eight.
Summer said he hopes the lawsuit, filed in March 2014 in Passaic County Superior Court, will vindicate his business and shine a light on the testing lab's practices.
"The damage is done on my end," Summer said. "Others that have used testing from NJMET, they need to know this. These parts could be in aircraft, in equipment that could fail."
The testing lab's attorney, Jerry Gallagher, said the company denied the new allegations and was "completely confident that it properly tested and thoroughly tested these parts."
Electrospec bought the brake parts from a Chinese supplier in 2008 and sent them for testing to ensure that they were authentic, new and functional, Summer said. The lab said 13,000 of the 20,000 parts passed its tests, and Electrospec sold them to Hydro-Aire, a California-based company that installs aircraft brake systems.
But Hydro-Aire's parent company performed tests of its own, revealing that some of the parts were not working and that they likely had been used and refurbished, said Richard Vrhovc, Electrospec's attorney.
The Federal Aviation Administration sent an alert to the airline manufacturing industry about the faulty parts in 2012 that said they were "not properly tested and could be counterfeit."
Vrhovc said the FAA laid the blame on Electrospec when it should rest with the testing lab.
"NJMET has been skating free on this for three years with no repercussions," he said.
Based on recent testimony from a lab test engineering manager, Vrhovc said, Electrospec plans to amend its suit this month to include an allegation that the lab violated the New Jersey Consumer Fraud Act.
The manager, Thomas Farinella, said in a deposition that he either could not or did not test at least two of the criteria that the lab agreed to review for the brake parts. Test reports show that the parts passed in those areas anyway.
Vrhovc also questioned whether it was possible for the tests to be performed as quickly as the lab reports said they were. One showed that a single worker tested 6,000 parts one day and 2,500 on another, he said.
Gallagher said the lab was reviewing Farinella's testimony. He said the untested areas would not have made a difference in determining whether the parts were faulty. He also said the tests were performed in three to five seconds and often by multiple operators.
Gallagher said Electrospec was using the lab as a "scapegoat" and that Electrospec never represented that the bake parts came from China, where counterfeits often originate. The company could have asked for a specific authenticity test, but it did not do so, he said.
"When you buy parts like this, they can pass today and fail tomorrow," Gallagher said. "If they had disclosed the source of the parts, it really would have been a game changer."
The testing lab was sued in 2005 by a former employee, Mark Williams, who also was represented by Vrhovc. Williams said he was instructed to falsify product-testing reports and that company engineers told him they could not or did not know how to test parts the company agreed to test for clients.
Gallagher denied Williams' allegations and contended that Williams' claims were never proved. The case was resolved in a confidential settlement in 2007.