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May
04, 2023
By
Leigh Collins
'Wilful and malicious' | Texas firm accuses Plug Power
of stealing its hydrogen liquefaction secrets, sues for millions
JTurbo says it invented the ‘ultra-efficient’
equipment now being sold by the electrolyser maker,
and had been in negotiations on an exclusive partnership when its
technology was misappropriated
US hydrogen equipment maker Plug Power has been
accused of stealing its “ultra-efficient” hydrogen liquefaction
technology from a small Texas-based company that is now suing it for
millions of dollars.
JTurbo Engineering & Technology LLC and its
founder and president Jacob Thomas have filed suit in a Texas district
court, seeking damages for the “wilful and malicious” misappropriation
of trade secrets.
According to the lawsuit, Thomas invented a cryogenic liquefaction
system that requires 5.2kWh of power to liquefy each kilogram of
hydrogen — which compared extremely favourable to other
“state-of-the-art” technologies that could only achieve 10-12kWh/kgH2.
JTurbo then shared “certain information — part of
its trade secrets — in confidence”, with Joule Processing, a
Houston-based engineering firm later bought by Plug Power, under a
non-disclosure agreement (NDA) “on or about April 1, 2021”.
Later that month, after Joule engaged engineering company Fluor to
validate Thomas’ technology, Joule and JTurbo entered into an
exclusivity agreement for Joule to be the “exclusive worldwide
packager and provider for JTurbo’s H2L IP [hydrogen-to-liquid
intellectual property] technology”, the lawsuit states.
This exclusive partnership agreement was announced by Joule on May 18,
2021.
“Prior to JTurbo reaching out to Joule, Joule had virtually no
experience in the Cryogenic Liquefaction Technology industry... Plug
also had no experience in Cryogenic Liquefaction Technology industry,”
the lawsuit states.
![](images/images_07_24_2023/pic1.jpg)
A still from the Plug Power video, highlighting the cryogenic
technology allegedly misappropriated from JTurbo. Photo: Plug Power/YouTube
“JTurbo solely developed the process liquefaction
cycle design without any input from Plug or Joule.”
In May 2021, Plug Power discussed with Joule and JTurbo “its desire to
develop a hydrogen liquefier to complete their value chain”, and Plug
and JTurbo subsequently entered into a non-disclosure agreement, the
lawsuit document says.
In February 2022, Plug announced that it had acquired Joule the
previous month “for a total consideration of up to $160m, with $30m
upfront and $130m of future earn-outs based on meeting liquefier
efficiency, third-party sales and gross margin targets".
A press release about the deal, published by
Joule on February 17, 2022, refers to “Joule’s liquefaction process”
and states that “the proven cryogenic process technology that Joule
developed for the gas processing industry is directly applicable to
hydrogen liquefaction and has the potential to reduce the cost of
liquified hydrogen by 25%.”.
The lawsuit states: “Joule was worth around $2 million to $5 million
before JTurbo shared their trade secrets, know-how, process
simulations, designs, and vendor lists.
“The technology that Joule — a small engineering company of about 20
people, turning over a few million per year — was sold for several
multiples of its topline to Plug.
“The only technological asset Joule, and now Plug, had of import as US
energy policy changes, is JTurbo’s trade secrets.”
The document adds that Joule and Plug “knew that forcing Thomas out of
the equation was the only way to leverage his technology and squeeze
him out”.
“The evil that was done to JTurbo and Thomas is that they were brought
to the table by Joule, and led to believe Joule could be trusted, when
Joule with its conspirator, Plug, decided to wreak havok [sic] on
Thomas / JTurbo, taking that which Thomas has spent the better part of
his life developing,” it states.
“The misappropriation was also willful and
malicious because Joule and Plug Power consciously disregarded the
JTurbo’s trade secret rights. They knew that the information provided
by JTurbo was confidential pursuant to Section 4 in the Amended
Exclusivity Agreement and NDA but still engaged in transactions
without compensating or licensing the JTurbo H2L IP from JTurbo.”
The Texas company is seeking damages at the United States District
Court for the Southern District of Texas of $11.2m from Plug — the
compensation it expected to receive from the four licensing contracts
signed between itself, Joule and Plug.
This is the second suit filed against Plug in a US district court in
the past month, with a class-action lawsuit filed by investors in
Delaware accusing the New York state-based company of making false and
misleading statements and failing to disclose “material adverse facts”
that subsequently caused investors to suffer “significant damages”.
Plug Power manufactures electrolysers, fuel cells and refuelling
equipment, and builds its own green hydrogen projects.
According to figures provided to Hydrogen Insight in November by
analyst BloombergNEF, the company is set to be the world’s largest
electrolyser manufacturer by the end of 2023.
Plug Power tells Hydrogen Insight it does not comment on ongoing
litigation.(Copyright)
Green Play Ammonia™, Yielder® NFuel Energy.
Spokane, Washington. 99212
www.exactrix.com
509 995 1879 cell, Pacific.
Nathan1@greenplayammonia.com
exactrix@exactrix.com
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