VietNamNet Bridge - Given that it suffered damages of over VND8 billion ($400,000) by Metro Cash&Carry’s unilateral termination of its contract, Nhat Thong, a printing company, has filed a lawsuit against the German group in a District 2 court in HCM City.

Nhat Thong requested the court to force Metro Vietnam to pay compensation of over VND8 billion, including VND1.1 billion ($50,000) for ceasing the printing contracts of the two Metro warehouses in Vinh (Nghe An province) and Ha Long (Quang Ninh province) without informing the printer in advance; VND6.4 billion ($320,000) for the unilateral termination of the contract and cancelling the orders for 13 other warehouses without informing the printing firm in advance; and the contract fine of nearly VND589 million (nearly $30,000).

Nhat Thong’s Director. Pham Huu Thoi, said that in May 2011, his company signed a printing contract with Metro, with validity to December 2016 (the two began cooperation in 2009).

To ensure good performance of this contract, Nhat Thong invested in its factories, machinery, equipment, and raw materials to print the publication called Metro Post for 13 Metro warehouses, based on a bi-weekly order. The number of publications per order is about 300,000 sets, using 54gsm couchee paper.

On December 27, 2013 Nhat Thong received an email about the contract with Metro on the cancellation of a printing order without a specific time. The reason was that Metro had requested to change the paper from 54gsm couchee paper into the 48gsm couchee paper but Nhat Thong was unable to meet the requirement.

Nhat Thong said that this was not the reason. According to director Thoi, his company had not received any official notice from Metro for the change of the paper, which was in stock by the printing firm to serve Metro. According to the contract, Nhat Thong had to reserve enough printing material for the use of eight consecutive orders.

Upon receiving the email from Metro, Nhat Thong said that it was important and needed time to review the case. On January 13, 2014, Nhat Thong received Metro’s official announcement on terminating the contract from February 15, 2014.

"Since Metro unilaterally stopped the contract on February 15, 2014, Metro completely stopped four orders with us, causing damage of over VND6.3 billion," a Nhat Thong representative said.

Earlier, on July 5, 2013, Metro suddenly stopped ordering for the two warehouses in Vinh and Ha Long. According to Nhat Thong, they did not receive any notice from Metro. As of May 15, 2014, Metro stopped 17 orders for these two warehouses, with a total loss of more than VND1.1 billion.

Since the Court accepted the case in March 2014, the two parties have been in mediation twice; the last was on August 13.

Director Pham Huu Thoi said the two sides were long-term partners and used to have good cooperation so he wished to solve the case peacefully.

He worried that the case would not be solved before Metro Vietnam is handed over to the Berli Jucker Corporation of Thailand.

Meanwhile, a representative of Metro Vietnam said that the company's activities are still normal and there will be no changes until the transfer is completed (expected in mid 2015).

The representative confirmed that Metro Cash & Carry Group adheres to the provisions of the law of the host countries, including Vietnam.

Lawyer Nguyen Kieu Hung, from the Giai Phong (Liberation) Law Firm, said if the dispute extends to the time the handover is completed, the case will still have to be based on the legal status of Metro with Nhat Thong.

VNE