Industrial Heat's Motion to Dismiss Denied in Part, Granted in Part (Update: Full Decision Added)

There’s an announcement from yesterday (July 19, 2016) on the Rossi vs. Industrial Heat’s Court Docket regarding the Motion to Dismiss that Industrial Heat filed and Rossi responded to:

ORDER granting in part and denying in part17 Motion to Dismiss for Failure to State a Claim. Counts II, V, VII, and VIII are DISMISSED without prejudice. All other counts remain intact. Signed by Judge Cecilia M. Altonaga on 7/19/2016.

So these are the counts from Rossi’s complaint that are intact and dismissed:

Count I: Breach of Contract (Non-Payment) Intact
Count II: Breach of Contract (Exceeding Scope of License) Dismissed
Count III: Unjust Enrichment Intact
Count IV: Misappropriaton of Trade Secrets Intact
Count V: Civil Conspiracy to Misappropriate Trade Secrets Dismissed
Count VI: Fraud and Deceit Intact
Count VII: Constructive and Equitable Fraud Dismissed
Count VIII: Patent Infringement Dismissed

So Judge Antonaga has spoken: half of the complaint has been upheld, and half thrown out. There is probably satisfaction and disappointment for both sides of the case from this decision. Where Rossi might be most disappointed here is with the decision to dismiss his complaint that IH breached their contract by operating outside of their license area, and filing patents based on Leonardo’s IP. This decision could allow IH to continue to file patents worldwide based on the E-Cat.

Industrial Heat might be most disappointed that while the claim for Constructive and Equitable Fraud has been thrown out, the claim for Fraud and Deceit still stands. Also, that they may be required to pay the $89 million license fee.

UPDATE: The full document on this ruling by Judge Antonaga can be read at this link: http://www.e-catworld.com/wp-content/uploads/2016/07/Motion-to-Dismiss-Judgment-Rossi_et_al_v_Darden_et_al__flsdce-16-21199__0024.0.pdf

  • LION

    THANKFULLY it looks like IH are going to have to PAY UP.

    • The question is, is that something that Rossi wants? If IH pay up then they will have the licensing rights according to the contract. I would rather expect Rossi to want the agreement to be deemed invalid.

      • TVulgaris

        He still has Europe, unconditionally- unless iH wins this case and counters. Which could be an important strategy in delay.

      • Engineer48

        Hi Hitesh,

        Rossi doesn’t want or need the court to invalidate the License Agreement as in that document, which is still valid and binding on Rossi & IH, there are clauses that deal with how IH must behave once a termination event occurs.

        Some of those clauses remove any right IH may have had to deal with the IP and also stop IH or any associated company or individual from engaging in any business that is in competition with Rossi.

  • Ged

    Actually kinda surprising, as I figured both claims of fraud against IH would be dismissed as there didn’t seem a solid case for them. Courts are fun for dramatic twists.

    Note those sections are dismissed without prejudice, meaning they can be filed again, though I don’t see how.

  • Bob Greenyer

    Count IV: Misappropriaton of Trade Secrets Intact

    this might allow big damages

    • Ged

      Yeah, that is a really dangerous one. The main Count I may force IH to pay up and honor the contract, but that Count IV could award far more substantial damages. Shall be interesting to see what comes.

      Count VIII the patent infringement being dismissed is no surprise as Rossi’s name was still put on the IH patent and the LA gave IH the right to patent, so no real legal claim with that one.
      Count II was just reaching and count I already covered, so no legal basis for the court to act there.
      Count V is no surprise since all these shell companies are owned by the same people so no real legal claim of conspiracy can come of that.
      Count VII seemed a weird stretch and apparently the court thought so too.

      But count VI was upheld which is a surprise to me. That and count IV could really hurt IH if Rossi wins. Don’t know how likely he could win count VI though.

      • Guest

        Count IV, if proven up, is unlikely to provide much if any damages because there have been no sales on which to assess a royalty, no lost profits for Rossi to recoup (because no commercial product), and no profits made by defendants that can be claimed. The potentially more important remedy is an injunction prohibiting defendants’ use of the trade secret.

        • Ged

          Never a dull moment!

        • Well… do we know that for sure? What about that U.K. firm that invested a lot of money in IH after seeing the 1 MW e-Cat plant? And I believe I read that IH made some big deal with the Chinese authorities. Of course I don’t have all the details, but my impression is that IH already has benefitted a lot from the e-Cat..?

    • peacelovewoodstock

      More likely Count VI Fraud and Deceit as this leaves the door open to punitive as opposed to actual damages. That is, damages on the scale of put IH and maybe Cherokee out of business.

      • Bob Greenyer

        Quite possibly, depends if it can be proven.

        • That is something that I am curious about. I would assume that it is important for the outcome of this case to be able to establish whether the e-Cat and the 1 MW plant actually work..? I don’t know how far the court will go to determine that. But no matter the details of the contract, if the e-Cat doesn’t work at all then obviously IH has all the rights on it’s side. Then it is Rossi who has been perpetrating a fraud. And if the e-Cat works then Rossi should be winning this case quite easily. Am I wrong? A correct conclusion is almost impossible without knowing this basic truth, whether the e-Cat works as promised.

          • TVulgaris

            That’s true- but we have no idea what the court (and now the jury actually can enter into this consideration, for better or worse, greatly obfuscating conjecture further) will consider as authoritative, and it will be at least largely based on the wording of the contract. Whoever twists “substantiate” and other such terms most successfully to convince the jury without the judge ruling them out will probably win, especially if either party prevents a live demonstration as being prejudicial.
            I do so love a good courtroom drama.

      • TVulgaris

        I couldn’t find the link to the contract quickly, nor the copy I’ve dl’ed- but I seem to remember Cherokee is very well insulated.

  • Bruce__H

    Nothing has been “upheld” here. And to my understanding no decisions have been rendered on the facts of the case. All that has happened is that the judge has found that some of the counts did not have sufficient grounds to even qualify as a legal case in the first place.

    • Ged

      Whoa now. Yes, the basis for a legal case has been upheld, attempted misdirection with semantics doesn’t change that. We already knew that back when the court moved ahead with the case inspite of the MTD, though we didn’t know then if some of the counts would be dismissed. And I am pretty sure everyone is well aware that the discussion surrounding the MTD had nothing to do with deciding the facts of the case beyond saying that if given they are all true, there is a legal case for the court to rule on.

      So relax. None of this is surprising or unexpected, except that the court sees a legal basis for claiming IH committed fraud. That I did not expect and still don’t really see, but the court does.

      The trial will decide which facts are actually true, and then we’ll see which if any of the counts Rossi wins.

      • Bruce__H

        I think you have put it well. In a motion like this a count is dismissed when a court finds there would be no legal case to rule on even if all the facts the plaintiff alleges were true. That is what has happened in some of the counts here. That is what I meant to convey.

        I’m not sure it is apparent to everyone, though, that the judge has yet to make decisions as to which allegations are true and which false.

        • Ged

          And sadly we won’t know that last part till the jury trial in June 2017.

          Thankfully Discovery starts in just a few months and could unveil a whole lot more well before trial.

          • MasterBlaster7

            the new 1 year test

        • Engineer48

          Hi Bruce,

          The judge will not be making any more decisions as that is now the job of the jury.

  • Keep in mind that things can be reintroduced if there is new evidence that comes up during the discovery process. I think that this happened in the Doctor’s Data versus Barrett et. al. case.

  • Buck

    I wonder how Rossi’s recent termination of the LA with IH will impact the judge’s decision. If the judge rules in favor of Rossi for the remaining counts, then will the judge recognize Rossi’s desire to wash his hands of IH and will the judge agree to the termination of the LA and of all IH’s rights under the LA? This would appear to leave IH and Darden with absolutely no legal means for unjust enrichment.

    I am guessing that Rossi would willingly walk away from the $89M . . . he has moved forward and appears to have new financial backers.

    • sam

      If A.R. walks away with the 89 million
      I hope he thanks IH for the 12 million
      that they paid him so he had the money
      to hire a lawyer to go to court.

      • Engineer48

        Hi Sam,

        If Rossi gets the $89m it will be because he earned it as under the conditions of the License Agreement as he earned the $11.5m.

        • sam

          I hope he did but the jury is still
          out on that.
          I hope they settle out of court.
          I still think that someone that
          both sides respect could broker
          a deal.
          But probably wishful thinking.

      • Bernie Koppenhofer

        And, we can assume IH’s attorneys are costing them ten times as much as Rossi attorney. (:

        • sam

          That means another 10 million that the British or Chinese
          investors might be indirectly paying for.
          A.R estimated his legal costs
          at one million.

    • Engineer48

      Hi Buck,

      There is no more judge’s decision, this is now a jury trial.

      The License Agreement is still in effect and as a Termination Event has occurred (triggered by breach of clause 3.2c and others), the causes mentioning termination are now in force, such as denying IH any right to use or deal in any way with Rossi IP and to prohibit IH and any associated company or person from engaging in any activity in competition with Rossi.

      • Buck

        E-48,

        fair enough . . . but there are still many steps between now and the jury trial. Discovery for example. So, now we wait to hear what the future holds.

  • MorganMck

    Yes, barring a successful motion to reconsider based on new evidence, the trial (if there is one) will only consider the remaining intact counts of the original complaint. Although I’m sure IH is pleased to have some elements off their plate, the biggie is (and always was) the $89M remedy for breach which is still there.

    • Bob Greenyer

      Of course a legal entity can always go bust after spending all it’s money on lawyers.

    • Ged

      Counts IV and VI could potentially be much worst for IH.

  • Ged

    It means the count as presented did not actually show that a legal dispute occurred.

    The patent count is actually a good example: Rossi didn’t sign or know about the IH patent, but legally it was ok for IH to make that patent as they put Rossi’s name on it. So, there is no legal problem for the court to rule on in regard to that count as it was written; and it was dismissed for failing to state a claim, since there is no dispute and no point considering it.

    Now, the judge dismissed those counts -without prejudice-, meaning Rossi’s lawyers could add additional arguments and resubmit those counts for consideration.

    As for the counts that were Not dismissed, IH can do nothing more, they are going to trial and there are no more appeals as the court found that there was a valid legal dispute occurring in need of a trial to resolve.

    • Engineer48

      Hi Ged,

      The judge did indicate the patent issues should be taken up by a patent court.

      • MasterBlaster7

        And, if Rossi is successful in this court case…especially if fraud is found…findings in a patent court case should lean heavily towards Rossi.

      • TVulgaris

        Usually, when a judge indicates such issues should be dealt with in a different court, it can be viewed as a recommendation…

  • Frank Acland
    • Ged

      Thank you, Frank! This is turning into a law course at this rate, it’s splendid.

  • Ged

    Discovery is a big unknown to me. Can what is discovered change the claims ahead of trial, adding or removing counts?

    You are right and do a bang up job summarizing the apparent leaked defense strategy for IH. Discovery will make all the information for 1) to 4) available to the court (dunno if we public will get to see it before trial though) as it is data from during the 1 year test and thus part of the disputed contract (count I). If isotope analysis was done during that period, I think discovery would find it.

    But could the isotope data be held as a trump card if it comes after discovery of the contract period? I am not sure on that, but it is a really good question you pose. Be some fun fireworks if so.

    • Albert D. Kallal

      I don’t hold any much credence on some isotope change (or lack of a change). The issue is COP and production of heat. An isotope change would not change what is measured in terms of output.

      Such an isotope change could well point to some nuclear process, but at the end of the day what’s relevant is heat output. I mean, if you find no heat output and a isotope change, how does that help? So I don’t think this issue will have relevance to this case.

      Regards,
      Albert D. Kallal
      Edmonton, Alberta Canada

      • Bruce__H

        I think it would work the other way wouldn’t it? If there is no isotope change then it would be argued there could never have been any anomalous heat produced.

        Dewey Weaver claims that before/after samples were taken from ecats at the Raleigh site when Rossi was not present and that they don’t show any isotope change at all. Sounds like IH are confident that there is no anomalous heat and no isotope shift when Rossi is not present.

        • TVulgaris

          Isotope changes require a nuclear process. Is that included in the contract or the dispute?

        • Bob Greenyer

          If the mode that produced excess heat was due to yielded gaseous fusion products that dispersed, that is say, hydrogen isotopes fusing to tritium / helium or transforming to “fractional hydrogen”, then excess could still be present without isotopic shifts.

          In any case, given that IH claims never to have got it working, if the isotopic shifts were in relation to long-term successful reaction operation, then statistically significant isotopic shifts would not be determinable if:

          1. The reactors produced low levels of excess
          2. The reactors did not operate for long enough
          3. The reactors were operating in a different mode
          4. The reactor stimulation / feedback system did not operate in the needed way
          5. etc.

          I find it curious when actors that do not conduct experiments are given credence / airtime for their postulations – especially when not a single piece of evidence backing up their claims is made.

          In our experience, good analysis judgement is accompanied by definition of the apparatus, control, protocol as well as the analysis procedure and lastly, but not insignificantly, data – preferably that has a reputable lab standing behind said data.

          • Bruce__H

            I’m sure you are right about all these possibilities. But you are talking science and I am talking court case. Rossi has been working hard for years to produce certain expectations among the people he works with. His previous results and the substantial excess heat supposedly produced throughout the year long 1 MW test yield an expectation of massive isotope shifts do they not? If there turn out to be no isotope shifts at all then I think that would have a big impact on the court case.

          • Bob Greenyer

            I have not seen certified and stood behind before and after isotopic analysis of the 1MW fuel and ash – so I cannot judge.

          • Roland

            A fully accredited engineer who has previously certified nuclear power plants has submitted, under oath with his accreditation on the line, a complete report on a years worth of actual hard data and personal observation that states that a 1 megawatt LENR device sustained an average, not peak, COP > 50 over the course of a year long test period.

            Please explain to me why a regurgitation of the, highly partisan, views of already discredited voices should be worthy of further consideration in this forum; we’ve already heard from APCO’s surrogates on enumerable occasions and they have nothing, if they ever did, to contribute here but the insult and unreason they’ve heaped on human beings that genuinely are worthy of respect for reasons of character and accomplishment.

            You are not talking science or court case, in any meaningful interpretation of those words, instead there’s just a steady stream of fact free ‘what if’ speculation and spin.

            Anybody can ask ‘what if the moon’s made of green cheese’. Proving that it is is another matter altogether; in fact it’s so next to impossible to disprove this without a truly monumental international effort that you could go right on saying it ad nauseum, as in a sense you have and continue to do…

            Tell you what, if a single thing you’ve ever posted here turns out to be factually correct in, let’s say, a year from now I’ll spring for coffee and doughnuts for you and the whole crew.

            Meanwhile I think I’ll pay attention to the posters who speak with the voice of decades of relevant expertise and experience who actually understand science and the law and a host of other disciplines; there’s getting to be quite a body of them and not one of them substantiates your views.

        • Albert D. Kallal

          And where are you going to get a fuel sample that was loaded at the time of the reactor being started and fueled up? No one going to allow Rossi to provide such a sample as that would not be independent evidence. So how you going to get a original sample?
          And if they find the ERV report flawed, then again isotope changes will mean nothing at all here. And if the ERV report holds up, then again the isotope changes means nothing – at least from a legal point of view.

          Regards,
          Albert D. Kallal
          Edmonton, Alberta Canada

    • MasterBlaster7

      Discovery is limited to proving/disproving the claims. Although, it is not impossible that something would be dredged up to use in a separate court case.

  • Albert D. Kallal

    If IH keeps the rights, this would prevent Rossi from selling into the given markets that IH owns. And if Rossi starts selling before the legal matters are resolved, then IH would have claims on each device Rossi sells into such markets once the
    legal issues are resolved (assuming IH retains such rights).

    It does look like Rossi wanted to “walk” from this contract, but IH could offer up their rights as deal to Rossi in Lou of paying the 90 million. However, if the COP is shown to be false, then IH will not have to pay the 90 million and will still retain
    the given ecat markets and IP rights.

    The way I see this, everything quite much rests on the proving or disproving the heat output and were the measurements valid or not.

    Regards,
    Albert D. Kallal
    Edmonton, Alberta Canada

  • Engineer48

    Hi Bruce,

    Body blows? Those are Weaver words.

    But YES for IH to stop a Rossi win, they need to discredit the ERV report.

  • kenko1

    Interesting times? NOT! Wasted, useless, diverting are more appropo. Rossi said on his JONP that he spends rougly 2 hours a day with his lawyers on the lawsuit. Time could be better spent readying the factories or setting up distribution facilities etc. if there ever will be some.
    YAWN, SNORT BELCH.(Shuffles feet, wipes nose)

    • Ged

      Terrible table manners.

      • Bob Greenyer

        1) Rossi will not bother, he’ll be still setting up in any case.
        2) Yes

    • TVulgaris

      What engineer wants to spend time redesigning his line or process if the manufacturer, presumably a well-experienced one (because, why else bother dealing with any but a tier 1 after IH?), won’t produce to spec? That’s another BoC contract issue. Deal with supply chain or distribution? That’s procurement and marketing, and neither have to do with the reactor design and development- and by all accounts, those other things are what Rossi is the WRONG person to have direct involvement with, and should avoid beyond C-level control. If he starts to micro-manage those, I’d become VERY skeptical he has any intent to commercialize. The delays to date since 2012 are due to external events and parties, but properly delegated those things are not even remotely impacted by the court case, or even necessitate Rossi’s effort past paying close attention to the contract this time.

  • Oh please, the judge very adroitly allowed the key issues go forward those being the question of whether IH engaged in scurrilous practices, leaving for another case the issues specific to patent prosecution

    • GiveADogABone

      It has occurred to me before that this trial is really a two-stage process. First decide if the licence has been breached to the extent that the licence fails entirely, then treat the remaining matters appropriately after that first verdict has been delivered by a jury.

      Was the first licence breach, that would cause the licence to fail, the failure to pay $89M, or can you find an earlier breach in the other counts that remain?

      • Bob Greenyer

        In the interim, IH cannot trade or represent itself seriously to any investing party or other stakeholder as having a licence since it is in dispute. Rossi, if he has working technology, can continue to develop it with no restriction other than time spent on case, whereas IH cannot build a factory or seek investment based on this action – and given the nature of the complaint, it is unlikely they would be able to secure investment for any other type of similar investment, since it is clearly demonstrated that the biggest in their portfolio has gone monumentally wrong. It does not matter who is to blame, IH are the ones that will suffer the most in terms if getting on with delivering LENR – assuming that was their aim they’ll have to do that with the resources they already have on the table which will be lessened by having to fight the case.

  • GiveADogABone

    Your 2) :
    If the licence agreement fails in total because of a serious breach (like failing to pay $89M) does this issue not disappear?

  • Albert D. Kallal

    Agree. and more important, just because they disagree over the test results, that does NOT necessary cancel their agreements over IP rights.

  • 2) Owning the Ip and it’s derivarion is an absolute requirement, because the Ip of the technology that is later improved have no value without the improvement…

    what is missing, and this is strange since the contract seems to be written by rossi according to IH who battle to make it coherent, is that Rossi don’t have access to improvements by IH.

    this would be fair, and would motivate Rossi to help IH to improve the technology themselves.
    he behaved as if IH could not improve the technology, which mean the IP was either non-existent or not-improvable.

    or he just don’t understand how an ecosystem works (mutual assured developement)

  • 1) you make an interesting point, but you interpret it reversely.

    if IH sell any product based on E-cat while at the same time moaning that they don’t have the IP and thus refuse to pay, they just look like fraudsters …

    this is above stupidity.

    they can rationally refuse to pay, claim they have no IP, if they estimate they cannot make any demonstration or cannot make any sale, based on that technology.

    this is fully logical if they have nothing that works and have no confidence in the ERV report.

    the behavior of Rossi looks also above stupidity if you assume IH is right, however I think we should also consider a special case of stupidity which are:
    – hubris
    – desperation

    it seems defkalion was first in hubris, thinking they were king of the world, then they realized they have nothing and desperately looked for funding and partners to make it work anyway.

    For rossi vs darden, question is who is desperate.

    consider wether IH was deperate to find 89 milions? it seems first that they can easily find 89Mn$ with an ERV reports that is credible. just make a crowdfunding…

    now even if they have problem to get 89Mn$, they still have 50Mn$ from woodford, that if the ERV report is credible could be partly invested in payment…
    in this case Darden would have talk to Rossi, abouit partial payment, license negociation with bigger share of income and less upfront payment…
    Darden would not be desperate, he would just ask for debt restructuration.

    however if Rossi is like Defkalion, all makes sense. suing before you are sued is desperate, but what to do else when you are cornered.

    IH says nothing currently, but Jed (whose disinterested honesty and investment in LENr science cannot be denied) and Dewey Weather (whose personal investment in LENR cannot be denied, especially monetary – he have skin in the game) claims shocking facts.
    if confirmed this gives sense to that hypothesis.

    note also that Rossi if he have a real technology have IP for half of the planet…
    he just can be half a trillionaire, IF he have the technology he claims.
    It is absurd to make a battle and slow developement battling with a partner in public.

  • yes, but it seems IH moaned many times agains the test, and this was ignored.

    if they did not moan when aware of things they later describe as problems, their case will be harder to defedn, but this seems not to be the case.

    note that unlike Rossi, IH when moaning do it in private, which is why we are only aware of Rossi’s point of view.

    we should be careful.

    • Ged

      In public, Darden was all praises, no moaning is recorded. That alone is enough evidence.

      • I was at ICCF19 and what shocked me was that he was not talking of E-cat or anything concrete.
        He was talking of scientific method, of potential to help the planet…

        He was not moaning in public, but he was not praising either.
        I interpreted it as corporate prudence.
        anyway the test had just started then.

        about the “we have some success”…
        he have some success (2).
        I don’t count E-cat among them.
        I don’t know which they are, but I know some who collaborated with him and are happy (not Brillouin).

        I don’t like when people accuse him of fraud because I have evidence it is unfair.
        I’m a bit surprised of that, but that is america…

        • Robert Dorr

          For reasons known only to I.H., I think they were trying to distance themselves from a positive outcome of the 1MW reactor very early on. This may have to do with them feeling they had over paid for Rossi’s technology. I think it is possible that all along they had planned not to pay Rossi the 89 million and they would negotiate a lower price after the test ended. They didn’t realize that Rossi would try and sue them so quickly. They thought that the 89 million was a big hammer and they would knock Rossi down a bit on price. Surprise!!

          • Hum,
            don’t you think it is a bit complicated and illogical ?

            maybe I’m naive but having a license on the invention of the century in US, darden would rather prepare to launch production quickly, avoiding any trouble (thus paying) with the inventor…

            your reasoning seems a bit overcomplicated.
            Maybe you should review it.

            There is possible more simple hypothesis.

          • Robert Dorr

            I think it is fairly simple in that I think I.H. had planned early on to try to get Rossi to accept a lower price for his technology, but they didn’t realize Rossi was going to be as touchy as he was. If you remember they tried to get Rossi to discontinue the test and accept a lower, undisclosed, buyout. Rossi, would have no part of it.

        • Ged

          He directly talks praises of Rossi in his interview in November 2015.

          • in fortune
            “But let me make one thing very clear. We don’t know for sure yet whether it will be commercially feasible. We’ve invested more than $10 million so far in Rossi’s and other LENAR technology and we’ll spend substantially more than that before we know for certain because we want to crush all the tests. (Recently, we have been joined by Woodford Investment Management in the U.K., which has made a much larger investment into our international LENR activities—so we are well funded.)

            Cold fusion has such a checkered past and is so filled with hypesters and people with a gold rush, get-rich-quick mentality. We need to be calm, prudent and not exaggerate. I don’t want to say that cold fusion is real until we can absolutely prove it in ten different ways and then persuade our worst critics to join our camp.”

            this is cautious…
            He cite public result of Lugano test, uncertain replications, but nothing of IH.

            he is much more positive on LENR.

            it can be interpreted different way today, but this does not look like the public communication of a guy who will run with the patent and claim it is his own work…

            Note that maybe they were not aware of some facts at this time, and still just asking for better test setup.
            What leaked recently raise highest concern, while it seems that until the end of the test, it was just a bad test where IH calorimetry setup was removed to put an unconvincing one.

            Like me they may just assume it was crazy inventor demand, and could be solved…

          • Ged

            You cut out the part were he says, “We’ve been seeing the creation of isotopes and energy releases at relatively low temperatures—1,000 degrees centigrade, which could be a sign that fusion has occurred. We have sponsored tests and more research for Rossi’s work.” Notice the plurals. And you cut out where he answers “yes” to if he is optimistic about Rossi, then speaks of Rossi’s patent. He is not being cautions about the validity of the tech, just the commercial viability which is a very different matter.

            A correction on my part though, as that was in September not November 2015.

            We tap dance around it, so allow me to go for the kill on this line of reasoning.

            There are two fatal problems with the original post:

            1) The assumption that IH was “moaning” in private about the test despite absolutely no evidence for this (so total mental speculation at this point), and that such “moaning” constitutes a legal defense (it doesn’t).

            2) That no positive public things were said that would show they were not exclusively “moaning” the test.

            I have shown that positive things in public were said, so that defense of supposed private moanings is invalid, since no public actions were done other than positive ones prior to the lawsuit.

            Furthermore, IH was in control of the test, with their engineers running it as well, and could have materially aborted the test at any time if desired. The amendment 2 made the test launch date fuzzy, so there was no contractual problem for them to abort and start again later. Since they administered and were being paid monthly for the test, this poses an insurmountable problem, as it was IH’s responsibility to make sure the test was running right since they were charging the customer.

            Also, Septermber was well past the half way mark of the -1 year- test. There is no room for “yet”s here, as they had egregious amounts of time to identify and rectify any problems, as well as personel daily on hand.

            So, I am afraid that while it is an interesting idea, and we could well see internal IH memos at some point, this line of reasoning offers no legal defense to IH. Public statements counter speculated private ones, no actions were taken to stop or modify the test, and IH was being paid for the proper running of the test.

          • Engineer48

            Hi Ged.

            Wonder what the jury will think when they are shown Darden’s words as attached?

            Totally blows apart the claims made by Weaver that IH never measure any isotropic changes or excess heat, as attached:

            http://fortune.com/2015/09/27/ceo-cherokee-investment-partners-low-energy-nuclear-reaction/

          • he just refers to Lugano test.

            note that this article publisahe in septemeber was published nearly the same (in a triangle journal) in april before, and thus ste the position of IH before IH realise what was happening to the ERV test.

          • Engineer48

            Hi Alain.

            So how does that reconsider Darden stating IH observed isotropic changes & energy generation with Rossi IP and Weaver stating IH NEVER observed isotropic changes & energy generation with Rossi IP?

  • roseland67

    Assuming of course the Ecat works as stated

  • GiveADogABone

    If you could point to the place in the licence agreement where an isotopic analysis is specified as a condition of the test’s success, then I think we might make progress along this route. The ERV report is right until someone proves it is wrong to the satisfaction of the court, including the jury.

  • Bob Greenyer

    As me356 has argued – you can watch the transmutation occur. If there is Argon and a little hydrogen, then LENR over time makes Helium, that was never there before, then the light colour would change – distinct spectral signature would be one way to monitor the reaction.

  • Engineer48

    Hi Bruce,

    Then we have what Darden said Sept 2015 as attached.

    • Bruce__H

      Exactly!

      Rossi’s work has led to the expectation that anomalous heat generated by an ecat is associated with large changes in isotope concentration. That is why the absence of isotopic shifts (if that can be shown) would indicate no anomalous heat and therefore COP = 1.

      • Engineer48

        Hi Bruce.

        Except Darden has publicly stated IH found both isotopic shifts and energy generation when testing Rossi’s IP.

        It is Weaver who makes the claim where were no isotropic shifts nor excess heat from testing Rossi’s IP. Bet Weaver wishes Darden never made that interview & told the truth.

        • Abd Ul-Rahman Lomax

          Darden did not actually say that. He was talking informally about the Lugano test and Parkhomov (and gets it wrong, by the way. Not in Switzerland.) He also said that IH wanted to “crush the tests.” That means make absolutely sure. They had not yet done that, AFAIK, or, more accurately, probably, it was in process. It is obvious that IH was playing a game of giving Rossi every benefit of the doubt. We will know much more, probably, by August 2, the deadline for the Answer. At this point, aside from rumor through Dewey Weaver, we have very little from IH and almost all here are assuming that the Rossi story is accurate.

      • GiveADogABone

        Irrelevant, unless you can show that isotopic analysis is part of the test protocol.

      • Michael W Wolf

        Your barking up the wrong tree. IH wants the IP rights. Now that their motion to dismiss has failed, we’ll see how they respond to Rossi’s claims very soon.

  • GiveADogABone

    ‘This is why I am asking if the EVR is the only thing that matters.’
    On my reading of the licence agreement, the answer is yes. Did you find anywhere in the licence agreement that isotopic analysis was specified as part of the test?

    • Engineer48

      Hi Bruce & GiveADogABone,

      I agree.

      Claim 1 is all about is the ERV report claiming a Cop => 6 correct or not. For IH to avoid paying the $89m they need to convince the jury the Cop was really <= 2.6.

  • GiveADogABone

    Isotopic analysis is definitely not in the agreement.
    Agreed

    What matters is COP
    Agreed

    I don’t think that matters.
    You don’t think that the contractual terms matter?
    Any others you would like to alter after the event?

    You are attempting to retrofit a test procedure that was :-
    1: not contractually agreed (as we agree),
    2: not carried out (as far as I know),
    3: subject to all sorts of uncertainties that already cause controversy, and
    4: not capable of changing the measured CoP (for which a contractual procedure was carried out properly (as far as I know)).

    If the CoP really was one, then the contractual procedure will clearly show that. If the contractual procedure really was faulty, then IH has to produce the evidence and get the jury to agree. The default is that the ERV report was right.

    • Bruce__H

      I expect that IH’s strategy will be to show that the EVR is mistaken. This is what they said in the motion to dismiss.

      On a grander scale I think the overall legal question is does a contract hold if one party has acted fraudulently?

      • GiveADogABone

        I look forward to seeing IH’s numbers. I expect the unexpected.

      • Michael W Wolf

        No way. Why would IH go to court and have to prove Rossi’ IP is useless? I mean they were offered to give up IP and forego the 89 million. IH is not going to court to get out of paying 89 million. They are going to court to win the Rossi IP.

  • Engineer48

    Hi Michael,

    Darden’s public statement that IH did see isotropic changes & energy creation when testing Rossi’s IP is now on the public record.

    No one can deny that or try to spin it away but I’m sure many will try to do exactly that.

    Weaver did early on say that after the $11.5m payment, the license was fully paid up, which could imply IH saw no need to pay the $89m.

    • this interview published in Fortune in september 2015, was in fact visibly done in April , and publisthe in the Business Triangle
      http://www.bizjournals.com/triangle/blog/techflash/2015/04/darden-cold-fusion-focused-industrial-heat-showing.html?ana=fbk

      even if it is not explicit, it sureful cite the Lugano test results which is discussed in the interview.
      It is true that at this time, Darden trusted the test, at least in public.

      note that the ERV test just had started, and the quarterly report seems not to be yet published.

      as Jed/Dewey report, IH was dissatisfied by the first reports, asked for correction, and was not answered.

      worst of all, and only sure things is :
      the usage of full emmissivity in lugano test is an huge error, and there is no question about it.

      this does not prevent the test to be right, is something else correct that error. however, given that undeniable theory error, there is no answer by Levi&al.
      Moreover Rossi did not answer anything either, and if there was an error of measured temperature, rossi who was present to setup temperature could not have ignored it.

      For me there is no room in “it does not work at COP>3/T>1200C” without Rossi being aware of it. I assumed it worked despite Levi&al’s error, but since nobody explained how the error was corrected, and given recent outing by Jed and Dewey (who are respectively financially independent, and financially involved in E-cat success, and both supporters of LENR) raise tons of red flags.

      note that one of the mystery is that grains extracted from the reactor after nickel should have melted looks too fresh, at best coherent with 800C as correction of emissivity lead.

      Many people imagine that we have been fooled by darden, by Jed, by Dewey…

      Sure we are fooled by someone.

      I think we have enough evidence to know who.

      PS: before the ERV ending, I filed 2 E-cat prereservation… I feel less fooled than Dewey feel, because I did not pay anything. I have just lost ego and time. Hopefully LENR is science… slow science.

      • Michael W Wolf

        Rossi publicly offered IH to forego the 89 million, all IH had to do was give up Rossi’s IP rights. Why didn’t IH take the deal, and why do they choose to go to court and risk the 89 million to try and keep IP right? Because that is all they have to gain in court.

        • first it is Rossi who sued IH.
          Second if things are like it looks, IH could ask for the 11.5Mn$ plus damages.

          Like Jed maybe do they think there is a tiny chance E-cat have some (even minor) reality, that they could transform into working technology and then business, to payback the 11.5Mn$ and 2 lost years, and the huge risk it won’t happen.

          It seems the plan of IH was not to go to court but to ask for what was in the contract until things are sure : it works, or it will never works.
          Notice how IH did not complain in public about the ERV and test setup.

          You can believe they are all lying, but this is nonsensical if Rossi have a working technology, given they have a license paid for half of the planet, to refuse to keep good relation with the inventor.

          On the opposite if there is nothing, as I say since long, a good stage magician have to keep controll of the stage, or sleep in the container. to attack when he cannot defend anymore.

          I’m just sad and tired.

          • Stanny Demesmaker

            Alain you’re deluded 🙂 There is a customer who says that it works. There are people who worked with Rossi and the e-cat who says that it works. What more proof do you need? Jed and Dewey are not credible sources.

            The most likely scenario is that IH is creating their own technology based on the e-cat.

          • Defkalion, Prometeon, then IH…
            Rossi is not lucky with his partners.

            Rereading Prometheon CEO complaints, republished by Abd recently, make me sad.

          • Abd Ul-Rahman Lomax

            What customer says it works? I have seen nothing from any customer.

      • Engineer48

        Hi Alain,

        My point was Darden stated IH had measured isotropic shifts and energy generation from Rossi IP.

        That statement is on the public record, admissible in court and credible.

        What Weaver & others who are not official IH spokespersons have stated are just hearsay, not admissible in court or credible.

        I doubt Darden will retract his statement in court as then his credibility is gone.

      • Abd Ul-Rahman Lomax

        Alain, the Triangle Business Journal interview has a different author from the Fortune interview. Yes, the Fortune interview seems anachronistic to me, given what we now know was going on by the date of publication, but it does not state when that interview was done. Fortune mentions Woodford, which happened in about May, 2015. Triangle only mentions the original capitalization of IH, as “nearly $12 million” in 2013.

    • Abd Ul-Rahman Lomax

      An attorney’s opinion was that the License existed from the $10 million payment in 2013, and was not unilaterally cancellable for nonpayment of the $89 million, which is merely an additional payment due assuming the Agreement was fulfilled. It would then be correct that they do not need to pay the $89 million to continue the License, but … they would still owe it, assuming that the ERV certified. Arguments here that the issue is the ERV certification that matters are correct as to the prima facie case. However, that is rebuttable. As an example of how the literal meaning of a contract may not hold, the Agreement explicitly provides that all parties must sign amendments and that the date of the 1 MW test must be agreed in writing signed by all parties. Does that hold? It depends. There is estoppel, which means that the conduct of the parties may signify agreement even if a technical detail is absent. Estoppel would be a factual determination, and the Judge decided that Rossi’s description of the history showed estoppel. If true!

      So, then, what was the background of the test? What was the purpose of the Agreement? All these will become important. The most obvious tactic for IH will be to allege that Rossi did not show them how to make working devices, and that argument could fly even if the 1 MW test, with Rossi living in the reactor, was “successful,” according to the ERV. And then IH could claim failure of specific performance, and that no further payment should be made until Rossi divulges all that is necessary for 1 MW plant function.

      They could also claim fraud, a different tack. Because of the way legal process works, they could claim both fraud and withholding of a necessary secret, even though ordinary thinking would be that those are contradictory. Law, however, does not require perfect knowledge. And the case is not likely to go deep into nuclear physics and isotopic transformation, that’s basically legally irrelevant here.

  • Michael W Wolf

    Darden confirms isotopic shifts in a public interview. Besides, there is a chance that Rossi’s newer devices get that spectrum that mills gets and Mills claims there is no isotopic shift. We assume isotopic shift is evidence of lenr happening. IT may be that isotopic shifts have nothing to do with output power.

  • Michael W Wolf

    Does it matter what tests? IH built both. If the second one they built doesn’t work, that is on them. But it looks like it did indeed work.

  • Veblin

    E-cat suit moves forward against Raleigh investors

    Jul 25, 2016, 10:38am EDT
    Lauren K. Ohnesorge
    Staff WriterTriangle Business Journal
    http://www.bizjournals.com/triangle/blog/techflash/2016/07/e-cat-suit-moves-forward-against-raleigh-investors.html

    • GiveADogABone

      1: ‘If mediation isn’t scheduled, the entire case could be dismissed, the according to the order. Vaughn didn’t respond to a request for comment, but has said the case against Cherokee is “without merit”.’

      If Rossi is active in trying to set up mediation and IH are not, then how is ‘the entire case [brought by Rossi] could be dismissed’ anything like justice? That looks to me more like a default judgement in favour of Rossi.

      2: ‘In a separate court document, filed July 22, the parties were ordered to schedule mediation by July 26. The deadline had initially been July 21 but, according to court records, that hasn’t happened.’
      Who is dragging it out? Not in Rossi’s interest to do so. The order for mediation dated July 26 is the court putting its foot down after a missed deadline and saying get on with it or else.

      • Abd Ul-Rahman Lomax

        Read primary sources, if you want to know, and read informed commentary. I uploaded the Order on scheduling mediation, it is linked from here: https://groups.yahoo.com/neo/groups/newvortex/conversations/messages/804 and followups cover the Rules and implications.

        Notice that I used quotation, and yahoo, irritatingly, suppresses display of that, so press the “Show message history” button to see it. Bottom line, making sure that mediation is scheduled is the plaintiff’s responsibility. Had Annesser (Rossi’s attorney) filed a request with the Clerk as would be procedure if the defendant was not cooperating, I doubt that the Judge would have issued the Order she did. So Annesser screwed up. He has until today, or the whole case might indeed be thrown out.

        • GiveADogABone

          Good find and a potentially serious error. I guess we now look for the filing report in the next day or two?

          • Abd Ul-Rahman Lomax

            I don’t know. A request to the Clerk might not show. If the lawyers agreed, they would probably file the appointment today. I’m following the free docket, because I don’t want to pay for docket pages… It occurs to me how I can check…. I’ll do it….

          • Abd Ul-Rahman Lomax

            Mediation has been scheduled for Jan. 12, 2017 at 10 AM. The mediator is Thomas. E. Scott, of Cole, Scott, and Kissane, in Miami.

          • GiveADogABone
  • sam

    From Lenr forum

    Court Docket (25 ORDER that by July 26, 2016, the parties shall select a mediator pursuant to Local Rule 16.2, schedule a time, date, and place for mediation, and jointly file a proposed order scheduling mediation. Signed by Judge Cecilia M. Altonaga on 7/22/2016. (wc)

    Judge John J O’Sullivan may be well placed as ‘mediator’ fba-sdfla.org/wp-content/uploa…sullivan-octnov14.pdf.pdf but could be another court official.

    Is this a signal that the parties do not want to go to full trial or just the next step in the court procedure?

    Best regards
    Frank
    Post was edited 1 time, last by “frankwtu” (Yesterday, 9:56pm).
    Alan Fletcher
    User Avatar
    Forum-Beginner
    Yesterday, 10:09pm
    This an automatic step in the legal process.

    Edit : since the motion to dismiss was denied (or at least suspended pending discovery, eg the “6-cylinder” question, which Rossi answered on his blog) I would have expected the next step would be for IH to file an actual answer to the “intact” complaints. (Even if just saying “we deny all allegations”).

    • GiveADogABone

      Just saying ‘we deny all allegations’ is not good enough.
      Rossi and IH agreed in the licence agreement to abide by the ERV report and its conclusions, particularly the measured CoP. IH have to comprehensively prove that the ERV report is fundamentally flawed, otherwise it stands. That comprehensive proof, if such exists, will be subject to the laws of perjury.

      • Bruce__H

        “IH have to comprehensively prove that the ERV report is fundamentally flawed, otherwise it stands.” This certainly makes sense but is it the actual legal situation? Do you know? What level of proof is required? Who is the burden of proof on? I can guess, along with others, but I wonder what the actual legal rules say.

        • GiveADogABone

          This certainly makes sense but is it the actual legal situation?
          According to the licence agreement, yes.

          Do you know?
          After reading the licence agreement, yes.

          What level of proof is required?
          The level that will convince the jury, if it goes to trial.

          Who is the burden of proof on?
          The defendants.

  • Obvious

    What if the Lugano reactor already had about 4 to 5 grams of slightly more coarse-grained Ni62 in it before the Natural nickel “fuel” was added? The likelihood of selecting pure Ni62 grains for testing from the fuel, before going into the reactor, would be almost zero. But after the test, the odds of selecting slightly larger grains of Ni62 from the ash would be fairly high. The same could have been done with a Li6 compound (possibly cementing the Ni62 inside during the fuel insertion.

    Hypothetically, of course.

  • Engineer48

    Will be interesting to finally read what IH has to say and who are the 3rd parties?