Jed Rothwell: Industrial Heat Don’t Believe ERV Report

  • Shane D wrote: "That makes me wonder about his supposed relationship with IH. Maybe I misread him earlier, but I got the impression he was in touch with them NOW, and they told him the plant didn't work."


    I am in touch with them now. But not often, and they do not tell me much. Everything I said was based on their press releases. I.H. did briefly confirm to me that a failure to "substantiate" the claim means they do not think there is significant excess heat. But what else could it mean? What other interpretation can there be?


    I think you should take both press releases at face value. They mean what they say. Rossi believes the device produces 50 times input. Whereas I.H. believes the tests failed to "substantiate" the claim. One of them has to be mistaken. There is no way a machine that produces 50 times input would fail to "substantiate" the effect.


    If you think there is some other interpretation to "substantiate" or you think there is some hidden meaning or motivation, you may be right, and that makes me wrong. I am not claiming any proof more compelling than the press releases and lawsuit documents which everyone has access too.


    To summarize: I do not wish to give the impression that I have super-secret or privileged access to information, and you should believe me on that basis. I don't! Just slightly better access than others. I try to base everything I say on published sources you can see for yourself. Which is not to say you must agree with my interpretation! Perhaps you have reason to think the press releases are not trustworthy and should not be taken at face value. If you are right, then I am wrong.

  • Quote

    then Tom believes, Jeb doesn't really believe what he says he believes because he 'rowed back'. Presumably now Jeb doesn't believe there is a second ERV just observers, I don't believe we can believe any of that, its beyond belief!!


    Frank - that is not what I believe. He rowed back from the "two ERV" wording which was implied in haste and immediately retracted. And the facts, which are that IH had its observers competent to monitor, are not changed by whether they are called ERV or not.

  • Abd wrote:

    I'll say this again: IH has not lost credibility at all. Rossi has. I see the private conversations of LENR researchers. It has turned drastically negative, and some stories are being told that were not disclosed until now. I cannot give specifics, but .... many serious LENR researchers are angry. Rossi's claims, they alleged, caused funding for other approaches to LENR to largely disappear. After all, if you are working on something, maybe you can get 10 watts reliably (which would be a good result in LENR), a megawatt power plant in operation makes that look silly. In fact, if Rossi were to disappear, there is little strong evidence for NiH reactions, and only scattered reports, with little independent confirmation.


    Abd, I agree with pretty well all of your comments in the post this is extracted from. And Ni-H has always looked on the "more pseudo" side of LENR research.


    Consider this. If IH does not give Rossi - and it seems to me very unlikely he will extract much from them, they will have even more money free (I hope) to fund proper LENR research.

  • Jed wrote:

    I think you should take both press releases at face value. They mean what they say. Rossi believes the device produces 50 times input. Whereas I.H. believes the tests failed to "substantiate" the claim. One of them has to be mistaken. There is no way a machine that produces 50 times input would fail to "substantiate" the effect.


    I am with you in this. Simple answers are always preferred.


    Rossi's ability to self-deceive over test results is history (that Swedish test that showed COP=1 from independent testing and was just not believed by Rossi).


    Rossi's tendency to view those who don't agree with him as snakes is similarly recorded.

  • This whole affair is a sterling opportunity to learn much about human nature.


    1. Read confirmed fact and legal documents. In this case, read the lawsuit and all the attachments. Study them so you know them. Read commentary from Mats Lewan and others with some experience in the field (such as Jed Rothwell), but in all this, distinguish between fact and opinion. For example, Mats came up with a theory. After some discussion, he presents alternate theories. Somewhere in there there might be some cogent analysis. But what do we actually know? We know what is in the lawsuit, and, as well, what is in the Agreement between IH and Rossi. Read the two relative recent IH ress releases and simply become familiar with what they say, instead of trying to "interpret" them as if they are some secret code.


    2. Then look at what is being written. You will see how little people understand of what is, in theory, in front of them. You will see people strongly affirming, as if proven based on these sources, what is not found in the sources.


    Some observations: Rossi filed the lawsuit prematurely. Mats didn't notice that, he wrote that Rossi filed as soon as there was a default. Mats failed to take into account that the agreement was five working days, not five days. Five working days is seven calendar days. The Penon report was allegedly delivered to IH on March 29.


    Many of those commenting assume that facts alleged in the Complaint are true. We have no independent confirmation that the report was actually delivered on March 29, and we have no confirmation that there even exists a Penon report. As has been pointed out, that report is a crucial document in Rossi's case. Why it was not included is a mystery. There would be, at least, an exective summary (since the full report could be quite long).


    But if it was delivered on March 29, per the Agreement, the payment of $89 million was due seven days later. That would be April 5. I'm not a lawyer, but the payment would not be delinquent until the next day, April 6. The Complaint was filed on April 4.


    As well, an essential element of the Agreement was full disclosure and delivery of IP necessary for the manufacture of units, no secrets withheld. Rossi has not alleged that he did this. If it was not done, IH not only doesn't owe Rossi anything, but Rossi would be in violation of the Agreement and could owe a refund (of $10 million), unless IH insists on specific performance, where it would get complicated.


    Assessment: if you accuse people of fraud, they stop considering your welfare and benefit and may indeed protect themselves by taking full advantage of opportunities to rip you off. It is really a Bad Idea. Hardly anyone will respond positively to being called a fraud.


    Assessment: Fraud is claimed because then triple damages can be claimed. Many think the suit is for $89 million. It is not limited to that, that figure is the alleged cash default. Triple damages are requested, covering patent infringement, etc., amounts not specified.

  • If IH does not give Rossi - and it seems to me very unlikely he will retract much from them, they will have even more money free (I hope) to fund proper LENR research.


    Consider this: If IH did pay Rossi $89 Million (assuming the plant worked for now), which I don't think they have even with recent investments, then IH would have no money for their other projects or their own E-Cat license-related activities. Sure they might be able to raise more money, which would dilute their position probably to a very minor position (the original investors are already diluted to something like 1/6 owners collectively, due to the Woodford deal). Eventually they could even be diluted to insignificance by the newer shareholders. Meanwhile Leonardo moves along, well funded. Not a good position for IH.
    **Just another viewpoint, not a statement of probability or assessing blame.**

  • Eric Walker wrote: "I think the part about there being a second ERV was a misunderstanding that is still floating around. What we know of IH's objection (which is very little) does not require that there have been a second ERV. What is needed is a dissenting opinion from a technically competent person, possibly an observer, which the license agreement allowed for. . . ."


    Yes! That is all I meant. Three people are listed in the lawsuit filing. I am sure that I.H. sent various observers. So, I just meant that I.H.'s experts disagree with Penon. That's what the press release says. They were not able to "substantiate" the reaction. Okay, that is a little vague, but surely it means their experts do not think it produced 50 times input.


    I did not mean there is another ERV official report. I don't know where that came from, but I did not mean to say it. I just meant "I.H. disagrees." That's what they said!


    I know nothing about the contracts or business arrangements, except what is in the lawsuit filing, which gives me a headache to read.

  • Shane D. wrote: "IMO, if Jed is going to be IH's pipeline to us, he might want to stop referring to Penon as an 'certified idiot" . . .


    I think he is an idiot, based on his 2012 report. Read it and decide for yourself. Would you prefer I hide my opinion of him?


    ". . . and be careful with his legal opinions about the case."


    Oh give me a break! I have as much right to express opinions as anyone else. I have experience in business and in lawsuits. In my opinion no judge will compel a company to pay $89 million on the basis of one report. If I.H. can demonstrate that expert witness such as licensed HVAC engineer disagree with the report, I expect they will win.


    On the other hand, if expert witnesses say the machine does produce 50 times input, I expect Rossi will win.



    "Unless, that is what his IH source is telling him, and he is just passing it on?"


    IH has told me ABSOLUTELY NOTHING about the lawsuit, or their business. I would never ask. I have only discussed scientific issues with them. My opinions about the lawsuit are entirely my own.

  • Jed


    See reference: Craig Haynie Tue, 12 Apr 2016 18:26:58 -0700
    On 04/12/2016 07:59 PM, Jed Rothwell wrote:


    Your response: Two things:


    1. There is more than one ERV.


    Who are the others? IH has the right, in the agreement, to have advisors who question and observe the ERV, but they don't sign the final document.


    2. It would be insane to pay $89 million based on a report written by Penon. I would not pay 89 cents. It would be insane to agree he is an expert. I am sure I.H. did not do that.


    At least that is what is recorded on Re: [Vo]:Next Big Future - goes out on a limb. My apologies if this is not correct but you can see how we might have got the wrong impression from this, apologies again.


    Best regards
    Frank

  • frankwtu asks:


    "Are there two ERV reports?"


    How the hell would I know?! I never said there were two. Rossi says there is one, written by Penon. The lawsuit lists three people involved in the evaluation. I am pretty sure one of them is from I.H. I am 100% sure that I.H. sent various experts to observe the tests at times.


    All I know is that the experts at I.H. disagree with Rossi's conclusions. That is what the March 10 statement said, and what their press release responding to the lawsuit said. Rossi said the gadget produces 50 times input, and I.H. said they "failed" to "substantiate" the results. If that is not a clear disagreement, what would be?


    Do you think I.H. will hand over $89 million even though their experts say they failed to substantiate the results? Just because Penon wrote a report they disagree with? In what universe would that happen?


    I cannot say which side is correct, but I trust the skills and and abilities at I.H. more than I trust Rossi's or Penon's. Rossi has conducted many bad experiments. He almost blew up the people from NASA. Penon wrote an inept report in 2012. The I.H. people seem sharp to me, but that is just my impression. It is not scientific data.

  • Quote

    I think he is an idiot, based on his 2012 report. Read it and decide for yourself.


    Anyone interested should read it. The idiocy is very obvious even at a non-technical level. Add a little bit of tech stuff and even more comes through.

  • Jed


    Do you think Woodford, Cherokee, and the Chinese investors trusted Rossi and Penon, if so why? Could it be they were influenced by Darden et al? If not, why did it drag on for so long with the positive hype from Darden? Who gets to keep the investment from Woodford, Cherokee, and the Chinese investors?


    Tom - on Penon's 2012 report


    The idiocy is very obvious even at a non-technical level


    Why was it not obvious to Darden, Woodford, Cherokee and the Chinese, they all had their observers in the container I understand, were they also idiots?


    Best regards
    Frank

  • Paradigmnoia wrote:

    Consider this: If IH did pay Rossi $89 Million (assuming the plant worked for now), which I don't think they have even with recent investments, then IH would have no money for their other projects or their own E-Cat license-related activities.


    I would not assume that. There are rumours of $50M form Woodford, and $200M from the Chinese. These come from Rossi and therefore I'd not trust them much. In any case we do not know what money has been given, and what money is contingent on a good long-term test. Obviously the latter has now vanished.


    But - we also cannot assume that IH have not been lucky and already extracted $250M or whatever.

  • Quote

    On the other hand, if expert witnesses say the machine does produce 50 times input, I expect Rossi will win.


    That is possible - but...


    If IH can prove that they have not been able to get anything to work, and Rossi has not responded when they've asked him to help (they may have an e-mail trail) then Rossi will have clearly contravened the license terms and therefore cannot win. Though exactly how that combines with everything else I don't know.

  • frankwtu wrote:


    Your response: Two things:


    "1. There is more than one ERV."


    Well, I meant there are three designated expert people in the lawsuit filing: Penon, Barry West and Fulvio Fabiani. I guess I thought an "ERV" is a person. I apologize for not using the term "ERV" correctly. I assumed all three will report their results. I guess the contract says Penon is the designated expert.


    Soon after I said that I listed the names of the people, so that's who I meant.



    "Who are the others?"


    Barry West and Fulvio Fabiani, as I said.



    "IH has the right, in the agreement, to have advisors who question and observe the ERV, but they don't sign the final document."


    I don't know who signed the final document. If that's what the contract says, I misunderstood. Sorry about that.



    "2. It would be insane to pay $89 million based on a report written by Penon. I would not pay 89 cents. It would be insane to agree he is an expert. I am sure I.H. did not do that."


    I meant it would insane for them to commit to paying $89 million no matter what the report says, no matter how bad it may be, and no matter what their own expert observer says. If that were the deal, Penon could write two line report: "It works. Pay up." And they would have to pay. That's absurd.


    Also, I have a low opinion of Penon, based on his 2012 work.


    Naturally, if expert witnesses say it is a good report, then they should pay up. If I.H.'s own experts had agreed it is good, surely they would have. They want cold fusion to succeed. $89 million is a cheap price to pay for a gadget that produces 50 times input.


  • I had not put that together. I think it is interesting, but I also disagree with the conclusions.


    What we get from this is that IH, and Woodford, were well aware that Rossi was a dubious character who lied.


    I think it likely that what convinced them both was the scientific due diligence (those many tests, including Lugano which appeared to be high quality).


    They could find many scientific advisors who would be convinced by that. In which case they would reckon they were dealing with an eccentric and untrustworthy but nevertheless brilliant genius who had the goods.


    I think the communication between non-science types and scientific advisors is sometimes a bit rough because the non-technical people will not know how to appraise critically the differing scientific advice they get.


    I see no evidence here to allege wrong-doing. Heavens - people here have been painting Rossi consistently as a saint in spite of contrary indications 10,000X as strong as this!


    Of course, I cannot rule out wrong-doing. It is just I like the simplest solution and "foolishness" is always more common than "fraud".

  • But - we also cannot assume that IH have not been lucky and already extracted $250M or whatever.


    If IH has attracted this much investment ($250 million), the original seed investors are collectively diluted below 10% ownership. They can be out-voted easily by their stronger investors, and directors given the boot and replaced.


    I don't think that $200 million was invested by the Chinese into IH, however. If I am not mistaken, it was the total investment into into a business park, some of which may, or may not, be devoted to LENR research.

  • frankwtu asks: "Do you think Woodford, Cherokee, and the Chinese investors trusted Rossi and Penon, if so why?"


    I have never heard of Woodford or the Chinese investors and I have no earthly notion who they trust or whether they have heard of Rossi and Penon. Where did you hear of these people? From Rossi's blog? I don't read it. I know nothing about his business, and nothing about I.H.'s.


    Cherokee is Darden's company, isn't it?


    I've heard of Rossi and Penon. I spent a couple of days at the Williamsburg conference talking to the people from NASA that Rossi almost blew up. Based on that, not only do I not trust him, I would be wary of going into a room where one of his machines is operating. The outlet hose was plugged up, steam was leaking out the seams, the temperature was climbing, and they realized there was no pressure relief valve on it! Cra-zee.


    He reminds me of Ohmori, who used to experiment with large open test tubes of boiling toxic electrolyte, spewing and fuming onto the table. Yikes!

  • Rossi is said to have said:

    Quote

    He also has said that he set up his own measurement system, using the exact same meters as the ERV, and putting them in series with those of the ERV. He said his results were the same as the ERV (within the margin of error of the instruments used)


    Doesn't sound particularly independent to me.
    Two wrongs don't make one right.
    By the way, who set up their instruments first?

  • Jed


    Where did you hear of these people? From Rossi's blog? I don't read it.


    See http://www.e-catworld.com/2015…-trust-uk-public-company/


    http://energycatalyzer3.com/in…could-put-money-into-lenr


    An Industrial Heat Investor Identified: Woodford Patient Capital Trust (UK Public Company)Posted on August 25, 2015 by Frank Acland • 19 Comments


    Quote from above: "When asked why he invested in LENR, Darden noted that he is aware of nearly 50 reported positive cold fusion tests. He mentioned work at the US National Laboratories at Oak Ride and Los Alamos and SRI (possibly Michael McKubre’s work). He also mentioned work at the Electric Power Research Institute or EPRI. The EPRI is a think tank and research organization associated with the US electric power industry".


    Best regards
    Frank

  • Jumping in to point out a mistake that recurs in almost all of the discussions of this situation.


    Most posters assume IH = Rossi Investment (or even LENR=Rossi), when in actuality IH has invested in Rossi along with several other LENR scientists/technologies (per their own statements). If any of those investments end up showing good results then IH's investors (e.g. Woodford et al.) are happy and likely in for a huge return on invested capital.


    IH's success does not depend solely on Rossi, and neither would an investment pitch. Woodford would have done due diligence on all of the IH investments, not just on Rossi, so it's unclear how much of their decision to invest would have relied on any one scientist or technology. They would have been aware of Rossi's checkered reputation and the small likelihood of success, so these new developments are likely not a surprise. If they thought there was a 100% chance of Rossi success they would have pushed to put a lot more than $50M in the deal (<1% of funds raised).


    Posters who claim the Woodford investment as proof that either Rossi's tech works or that IH was committing fraud are way off base. Unless you were part of the investment pitch you have absolutely no clue what was presented or what the basis for investment was.

  • In other words, unless IH had an unmentioned source of extra funds, they have never had enough money to pay Rossi if the plant was successful and the report on it was totally solid.


    I never said anything like that, and not sure how you would have interpreted that from my post.


    But... to the first part of your question I haven't seen any public documents laying out investments other than the ~$50M from Woodford and then the initial ~$10-12M from other sources. However, that also doesn't mean they didn't or wouldn't have had enough money to pay Rossi. I don't see how anyone outside of IH could really know that without access to a lot of private documents, as things like contingent contracts for follow on capital, new investors, lines of credit, etc might have been available for them to call on when/if needed.


    Non-investors tend to think of 'having enough money' as meaning the funds are sitting in a bank account, but that's not really a relevant way of approaching it as there are the funds you have plus funding you have access to that remains un-executed until/unless called upon.

  • @Guest
    I am not interpreting that from your post entirely, but also from a variety of sources.


    One issue (to Rossi) may be that IH, although well connected, cannot access $89 million within 5 (business) days if Rossi's conditions were properly fulfilled, unless IH made appropriate actions to ensure that could happen. Probably almost nobody could raise that kind of money in the public or private markets in 5 days, even if there was a demand, since it takes time to formalize these transfers. Cherokee can only move so much money around, even if it has the assets. There is a lot of paperwork involved in shuffling cash around from a fund. IH did not probably have much more than half of that $89 million available (from Woodford), since some of it is involved in other business. Their investments are not known enough to gauge the amount they may have spent on other projects and patent purchases/filings. It is known that Rossi received most of the money IH had from their initial financing.


    So if IH did not secure about $40+ million elsewhere, on a schedule based on the term of the 1 MW test, then they could not fulfill their part of the contract.
    Possibly they had reason to believe that Rossi could not perform his contractual obligations, and so IH did not bother to organize the extra funds.
    That may be considered (by Rossi) to not be acting in good faith.

  • Guest: Non-investors tend to think of 'having enough money' as meaning the funds are sitting in a bank account, but that's not really a relevant way of approaching it as there are the funds you have plus funding you have access to that remains un-executed until/unless called upon.


    I am sure that after the testing was complete and the ERV report was in, that we now know that the contract required payment immediately. Not sure if you mean Rossi investors.
    My experience in contracts is when you have a due date you pay, they do not wait X amount of days not unless there is a penalty stipulated.


    Paradigmnoia: I did not see your reply before my comment, yours is more to the point.

  • Guest:

    Quote

    Woodford would have done due diligence on all of the IH investments, not just on Rossi, so it's unclear how much of their decision to invest would have relied on any one scientist or technology.


    It is becoming increasingly evident even to other than LENR skeptics that IH's due diligence on Rossi's electric water heaters was more diligent than intelligent.


    An insight that seems not yet to have dawned on the LENR huggers is that IH's due diligences on the other LENR mongers that are mentioned as possible LENR investment objects probably also have been substandard.


    Those investigations may have been made by the same gullible person(s) in line with the Rossi modus operandi recycling the same guys that he has found to have an appropriate level of incompetence. The only difference being that IH is unable to distinguish competence from incompetence when it comes to establish the energy balance of an electrically heated system.