Solar Grade Litigation: Dow Corning vs. RSI Silicon

DowCorningimage001(2) RSISiliconlogo_thumbLawsuit regarding Misappropriation of Trade Secrets for the purification of solar grade silicon moved from Michigan to Pennsylvania.
Who is “XYZ Co.”?

Almost two weeks ago, “Forks solar energy start-up sued: Industry leader Dow Corning and RSI Silicon exchange charges of trade secret theft” by Peter Hall for THE MORNING CALL provided an update to the lawsuit first filed by Dow Corning Corporation against RSI Silicon back on March 25, 2010, in Michigan. One month later, I posted Dow Corning stopped UMG Solar Grade Silicon Production.

Right after the original case was dismissed on November 15, 2010, as “the federal court for the Eastern District of Michigan does not have jurisdiction because RSI did not conduct business on a continuous basis here”, Dow Corning refiled the suit in U.S. District Court, Eastern District of Pennsylvania, by Friday, November 19, 2011.

Partnership intrigue
Per Mr. Hall, RSI Silicon countersued on March 7, 2011:

RSI returned fire March 7 with allegations that Dow Corning tried to steal RSI’s secrets under the guise of striking a partnership with the Forks company.

In its counter lawsuit, RSI says it never obtained trade secrets from XYZ Co., but when Dow Corning learned that RSI had contacted XYZ, the larger company proposed a partnership.

When Dow Corning representatives visited RSI’s plant, they refused to discuss the partnership, but insisted that RSI share the company’s process and demanded a tour of the facility, the counter suit says.

Perhaps Dow Corning was following in the footsteps of In Search of RSI Silicon?

When I read the RSI Silicon counterclaim, I also found point 26 interesting:

As part of its efforts to obtain information about RSI and to hinder and prevent RSI from competing with Dow Corning, Dow Corning also retained the law firm of Gibson, Dunn & Crutcher LLP (“Gibson Dunn”), which had been provided confidential information regarding RSI’s solar-grade silicon work by RSI pursuant to a confidentiality agreement with potential RSI investors as far back as 2006.

Lawsuit background
In the original Michigan suit, “Dow Corning lawyers ask federal judge to stop Easton, Penn., company from replicating process for purifying solar-grade silicon” by LaNia Coleman at The Bay City Times said:

An unidentified Dow Corning vendor tipped off Dow Corning officials in August after an officer of RSI allegedly contacted the vendor to discuss “a research and development project relating to purification of solar-grade silicon,” court records show.

“Without knowledge of Dow Corning’s trade secret purification methodology and equipment, a solar-grade silicon manufacturer would have no reason to contact a vendor … to aid in research and development work,” Debold wrote in the complaint that seeks injunctive relief and damages in excess of $75,000.

RSI is involved in developing solar-grade silicon but has no apparent reason to tap the vendor in question outside of replicating Dow Corning’s “trade secret purification methodology and equipment,” Debold claims.

Contacting the vendor “was unusual and illogical based on the purification methodology and equipment that (RSI) claims to use and which is disclosed in (RSI’s) patent … ,” according to court files.

RSI Silicon responded, and “Easton, Penn., silicon maker calls Dow Corning lawsuit frivolous” by LaNia Coleman at The Bay City Times said:

The incident that grabbed Dow Corning’s attention occurred several months ago when RSI was shopping for a spin caster, a machine used to take impurities out of stainless steel, gold and other materials, Resnick said.

“When you’re in the market for something as common as that, all you do is go to (the Thomas) Register to find out who makes it, call them and ask if they have it in stock and if you can buy it,” Resnick said.

“It’s a generic piece of equipment that is not involved in our production in any way, shape or form.”

Resnick said RSI called five companies around the country before renting a spin caster from a company in New Jersey.

Current Status
Justia.com maintains a Dockets & Filings webpage on the case, DOW CORNING CORPORATION v. RSI SILICON PRODUCTS LLC et al, with links to the US Court’s PACER (Public Access to Court Electronic Records) system.

By accessing PACER, I learned multiple motions by Dow Corning to dismiss the RSI Silicon counterclaim have thus far been denied. An in person settlement conference is scheduled for October 4, 2011, in Allentown, Pennsylvania, before Magistrate Judge Henry S. Perkin. Meanwhile, a “Protective Order shall govern the handling of all documents and information exchanged by the Parties in this action.

A spin caster or a red herring?
A spin caster utilizes centrifugal force to produce light metal castings from a rubber mold. Suitable for casting materials with low melting points, the equipment is not designed to operate with silicon metal melting above 1410.0 °C!

Understanding there may be posturing and positioning within the allegations and counterclaims by both parties, is it a stretch to think a spin caster might be a plausible though inaccurate way to describe a similar process, centrifugal casting, capable of silicon directional solidification in theory? While this may be pure speculation, Gibson Centri Tech Limited is an example of a company manufacturing industrial strength Centrifugal Casting Machines to order as demonstrated in a promotional animation.

The speculation will only be put to rest if the identity of XYZ Co. is revealed.

Dow Corning did not even acknowledge my questions about the litigation.

Since the claim RSI Silicon commences Solar Grade Silicon production, RSI Silicon has been quiet though surviving the economic downturn.

RSI Silicon CEO Dr. Steven Amendola also co-founded Grid Storage Technologies, LLC, which “has developed a proprietary, fully rechargeable zinc-air battery technology” invented and patented by Dr. Amendola.

One comment

  1. Hi Ed,

    This article also got my attention.

    Following something of a pattern, Amendola has already moved on to bigger and better things in a completely unrelated field. His venture prior to RSI was Millenium Cell, a publicly traded fuel cell company that declared bankruptcy in 2008.

    Surprising that Dow Corning – the quintessential partnering company and silicon expert – would take the time to pursue something like this. But, they do know their stuff. It is a wild guess, but perhaps there was an issue of an asset sale upon dissolution that could put technology in the hands of someone else.

    Not surprising, of course, that Dow Corning would not comment on an active legal matter.

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