Cat Accused Of Fraud Over Clean Fuel Technology
January 20, 2000
An arbitrator accused Caterpillar Inc. of fraud by improperly patenting and marketing diesel engine clean fuel technology that belonged to a former joint venture partner.
According to the Wall Street Journal, Caterpillar formed Advanced Fuels LLC with Reno, NV-based A-55 Inc. in 1994. The venture was set up to commercialize so-called aqueous fuel technology. Advanced Fuels was dissolved in 1996.
In the past few years Caterpillar has obtained six patents related to the technology and another 12 are pending. A-55 contends that some of those applications were filed before the breakup of the joint venture and that it owns the technology.
Arbitrator Edward Costello Jr. sided with A-55 and accused Caterpillar of concealing its "misappropriation" of the technology. He said a new joint venture with Lubrizol, now working on a fuel blend called PuriNox, is pursuing technology rightfully owned by A-55. While Costello didn't spell out specific damages, he did call on Caterpillar to turn over its patent files to A-55, stop selling or using the technology, and account for all profits obtained from the use of the disputed technology. Caterpillar can challenge the arbitrator's opinion.