Court-Ordered Mediation Scheduled For Jan 2017 in Rossi v. Industrial Heat Case

Quote from Walker

Hi all

With respect to all and sorry about the crudity of language. As a Canadian colleague of mine put it.

There are many things worse than using crude language. One of them would be a fake apology for using crude language when there is absolutely no necessity for it. This boils down to "my friend used crude language."

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It is all about the price at which you [crude expression] essentially once enough money is on the table all will deal if for no other reason than to have enough money to prevent others from falling into such circumstances.

That's a bit incoherent. The crude expression means to fawn or engage in a humiliating behavior in order to gain some advantage. The core of this is an idea everyone has their price, that if enough money is involved, ah, exactly where do you want this done?

I don't agree, but I will agree that when large sums are involved, "normal ethical behavior" might disappear for some. People may rationalize it, inventing new reasons when the real reason is the money or other personal benefit. Some people can and will betray their profession, their friends, and the normal expectation that people don't lie can easily disappear. And that is why we want to know about "conflicts of interest." They can influence how we think.

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If as Dewey and various others claiming to speak on behalf of IH are being truthful [...]

Nobody has, here, claimed to "speak on behalf of IH." Nobody. This is a complete straw man argument. What has happened is that one person (Dewey Weaver) is a known insider, with high access to at least some otherwise confidential information. However, Dewey's comments are clearly his and do not represent any official IH position. While he certainly knows Darden -- and has also met Rossi -- his opinions are, I am sure he will agree, his own. If one chooses to trust his testimony of his experience, that's a personal decision. If one looks carefully at other statements here about what IH has done, some may be based on personal information and belief, perhaps a private conversation. To my recollection, in my case, none of these have been specifically attributed. My own comments are based on public record and public commentary. I have mentioned private communication only in a very general sense. Obviously, whatever I attribute to private conversation -- which is extremely little -- is not "speaking for" others.

There is an exception: I sometimes use "we" to refer to the CMNS community, and I am informed by extensive communication with the community in two ways: through the invitation-only CMNS mailing list, and through private conversations with researchers, increasingly by phone and I'm moving to personal, face-to-face meetings. I use "we" when I expect that what I am saying will have general approval. It is not exclusive, and the community is diverse and has varied opinions. Still, it is possible to express a consensus and when I do so, it is informal. At this point, there is no official representative of the CMNS community. That might change. If so, there will be election or similar process.

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then IH can either pay enough to make Rossi go away or fight the case.

Indeed. They could also counterclaim for fraud, if they believe they have enough evidence. I suspect that they might.

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Note Well! IH said do not trust any information about IHs position unless it is directly from them, Dewey, Jed, Lomax, all fall into this category of people IH themselves told everyone not to trust, people seem to forget this.

As usual, on Planet Rossi, clear statements are interpreted into murkiness. This would be a reference to the IH press release at the beginning of March, before the lawsuit was known, and while Rossi was still claiming that there was no "divorce," everything was fine.

https://animpossibleinvention.…-heat-makes-announcement/ has the announcement.

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We value credibility through sound LENR research. That’s why any claims made about technologies in our portfolio should only be relied upon if affirmed by Industrial Heat and backed by reputable third parties who have verified our results in repeated experiments.

This was a normal statement, highly conservative, and not about what Dewey, Jed, or I have written. It does not state what Dewey claims, but is more likely to be what he remembered about it. It ought to be obvious that IH is not responsible for what any of us write here, unless the author is formally approved by them. "Rely" on would mean to make an investment or take some position that, if in error, could be costly.

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If as Rossi and the ERV contends the reactors work, then IH's options are diminishing.

We know that Rossi contends this, Almost everything we know about what happened with IH has come from Rossi. So, here, Walker states it as a fact that the eRV "contend ... the reactors work." But we have not seen the report, and we have only rumors as to what is in it, and details matter. Further, the fundamental issue in Rossi v. Darden is not the payment failure -- if the ERV certified guaranteed performance, and if this was all proper contractually -- that has been contested -- then IH formally owed $89 million. However, that was not the whole contract, it was, essentially, a payment detail. The essence of the contract from what it required of Rossi was not only delivery of a 1 MW E-cat unit, but also delivery of all technology necessary to build working devices, plus, of course, a License for half the planet.

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If Rossi feels he can make more money than the $89 million from going along with a partner with a more lucrative deal the only option IH have is to pay up the $89 million plus some additional money to get things back to the original contract and start manufacturing E-Cats.

they certainly have another major option, which I will express using language I hear all the time, since I have a self-expressed teenager living with me.

They can tell him to fuck off.

However, the IH people are from North Carolina. They would never say something like that. And it should be completely clear that this was not an authorized statement from IH, it is a speculation as to a possible action they could take, which could include and show up as going after every penny Rossi has. Several basic rules of business Rossi violated:

1. Keep your customer happy. Do not depend on them paying you if they are not happy, no matter what the paper you hold says.
2. Do not piss off the people who run a $2.2 billion investment fund, unless it is totally necessary for your critical agenda. And be aware that if you pick the wrong company, you might disappear never to be seen again. It's a really bad idea absent total necessity, i.e, the cause is something that you are quite willing to die for. And, again, this is not a threat. IH people seem entirely too nice. But read the beginning of this comment. Put enough money on the table, "nice" can go out the window. Ah, the stories I know from some of my friends.
3. The time to consult a lawyer begins before signing a $100 million contract. I don't care how good it looks.
4. Never sue first and ask questions later. Find a good attorney you can trust and allow them to negotiate. It will be worth every penny it costs, because it could save you far, far more.

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Of course I still think the October Surprise is a possibility.

People wonder why IH did not demand their money back in return for cancellation of the License. I don't wonder. It is a hedge against an October Surprise.

Rossi cannot unilaterally cancel the License, so the License is still in place, and it covers new developments. To negate that, he would have to prove fraud or the like, and really, all he has even alleged as "fraud" is that they had no intention to pay, and that is mind-reading, unless he has clear evidence we don't know about.

He has alleged that they misled him about Cherokee, when contract law would completely negate his position.

The judge did not remove Cherokee as a party to the suit because she was under a legal obligation to take every Rossi assertion as truth, and Rossi asserted that IH was a wholly-owned subsidiary of Cherokee, when it never was, and apparently no Cherokee money went into IH, nor was anything alleged that would be any adequate sign that Cherokee was a party to the Agreement.

Planet Rossi rejoiced at the "victory" of the ruling on the Motion to Dismiss. In fact, Motions to Dismiss are very difficult, precisely because every allegation in the Complaint is presumed true, and that four out of eight counts were dismissed was high success, not a big loss, as pretended.

Quote from "Hermes"

there would have been no problen raising $89M had Rossi respected the agreement.

It is NEVER a "NO PROBLEM" issue to raise $89M. Especially if you do not OWN the IP you're peddling ... I believe Darden thought it would be a lot easier than it turned out to be.

Quote from sifferkoll

"Hermes" wrote:

It is NEVER a "NO PROBLEM" issue to raise $89M. Especially if you do not OWN the IP you're peddling ... I believe Darden thought it would be a lot easier than it turned out to be.

What Hermes wrote was correct, i.e, if Rossi had taught IH how to make devices that worked when independently tested, where all that was needed was some more engineering for practicality, etc., there would have been no trouble raising, not just $89 million, but a lot more, perhaps $1 billion. IH set out to break the logjam. Something was stopping Rossi and they decided it was important to find out.

They found out.

The proof that they could have raised $89 million: they raised $50 million from Woodford, apparently for general, non-Rossi research, stuff nowhere near ready for market. Stuff where near-term loss is the most likely outcome.

A product almost ready to go?

Sifferkoll, you are a consultant. This should all be obvious to you if some meme hasn't taken over your brain.

As to IP they owned, they had a License for half the planet, and that License wasn't revocable by Rossi merely for alleged nonpayment of the $89 million. They still have the license. It covers new development. Watch the lawsuit if you don't believe me.

Quote from "Abd"

The proof that they could have raised $89 million: they raised $50 million from Woodford, apparently for general, non-Rossi research, stuff nowhere near ready for market. Stuff where near-term loss is the most likely outcome.

BS Abd. You are as usual making stuff up. The non-rossi stuff is only FUD. You know that.

It obviously took IH three years until 2015 before raising the first $50M from Woodford. And at that point Darden was "extatisk" about Rossi (as you pointed out in thousands of words ), dancing and singing and whatever ... So, Darden learned the hard way, that since he couldn't steal the complete sauce from Rossi it was really hard to raise money not owning it. Dardens big mistake was to believe he could delay for so long that he had the time to get all IP without paying the $89M. He failed miserably!

The problem for IH when selling was the simple everyday question, that every possible investor asks - Who owns the IP? Probably IH somehow made Woodford believe they got the sauce, who knows... IH should worry about that ...

We also know that Darden/Weaver travelled the world recruiting R&D talent with the sales pitch that they would share the Rossi sauce with them if signing away their IP for peanuts.

Quote from sifferkoll

"Abd" wrote:

BS Abd.

Charming.

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You are as usual making stuff up. The non-rossi stuff is only FUD. You know that.

Sifferkoll says again and again, as if it were clear fact, what he does not know. For example, he claims here that I know something where, in fact, I know the opposite. I know some of the researchers being funded. I know what they work on. It isn't "Rossi stuff." It is primarily PdD work.

In order to maintain his belief in Rossi, and perhaps to attract other investors, Sifferkoll is forced into a position that the LENR field is infested with liars. People who have devoted much of their adult life to LENR are dismissed as "FUD-bots."

No, Sifferkoll is Obvious Obvious. Again and again on his blog, he twists what people have written to create an appearance that is opposite to what they intended.

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And at that point Darden was "extatisk" about Rossi (as you pointed out in thousands of words ), dancing and singing and whatever ...

Nope. I did not point that out, but the opposite, and cited evidence, and it was not "thousands of words." Maybe a hundred on the point. Sifferkoll is a troll, this is troll behavior, to misrepresent what others have written, pushing for a rise. He is making no useful contributions here. Just noise and, yes, confusion and FUD.

Sifferkoll has a strong habit of not using links when citing. He does the same on his blog, often. It makes it easier to get away with out-of-context quoting and misrepresentation if there is no link. The normal quotation process here will create a link. It's actually harder to do it his way.

Quote from "Abd"

I know some of the researchers being funded

Yup.

But with peanuts in comparison. Hardly the reason for Woodford to invest $50M. I see this funding more as buying loyalty from the IH side (instead of paying directly for the FUD). Some of it was combined with promises of sharing the Rossi IP to reduce the price (Weaver sales pitch).

Quote from "Abd ul"

People who have devoted much of their adult life to LENR are dismissed as "FUD-bots."

Ohh! You're such a whimp. Stop feeling sorry for yourself. (the issues you are refering to are not correlated)

Quote from "Abd again"

not "thousands of words." Maybe a hundred on the point

It sure feels like thousands ... (I cant help thinking that you are setting yourself up to be a prime IH suicide bomber; drowning everyone, including yourself, in endless rants of useless boring words...)

Quote from "Abd"

Sifferkoll is a troll

I know you feel that way Abd, but more likely it depends on your religious beliefs.

Quote from "Jed"

How do you know

Well, I believe it was you who said that the $50M Woodford cash was in a bankaccount somewhere... So I conclude that the cash paid to other R&D teams was in the k's not M's. Rumor is that IH paid those teams with lots of toilet paper IH stocks as well though ... This would be a good way to buy IH loyalty I guess...

Quote from JedRothwell

Quote from sifferkoll: “Well, I believe it was you who said that the $50M Woodford cash was in a bankaccount somewhere...”
I said it was not profit. I said they cannot take it home and spend it themselves. They have to spend it on research.

What we know about the $50 million is that it was paid to IH Holdings International, a U.K. limited partnership that appears to have been set up to receive the Woodford Investment. It's right where Woodford could watch it. Two blind investment trusts bought, together, exactly $50 million of Class A stock, at about $45 per share or so, whereas ordinary stock has a par value of $0.01. Hence "penny stock." Most investors in IHHI, and there is quite a list, paid the $0.01, I think. Some may have been paid in stock for some benefit conferred. That's not at all clear, it's all speculation, that I've seen. Limited Partnerships do not necessarily disclose their finances. Where the money actually is, we don't know, but my assumption is that Woodford could get this information, and investors would get reports. There is all this mishegas about that money by those with no right to know. Basically, this is the investor's business.

Just as it is Hydro Fusion's business if they want to do business with Rossi, all things considered.

The signs are that substantial sums are being spent for research. Not merely "thousands." Not necessarily "millions," either. It would depend on the project. Some of this work is quite expensive. Some support for a theoretician might not be so expensive. He gets to buy chalk. To travel to conferences. $50K might be cool. Depends.

Quote from sifferkoll

For IH to raise money now is useless/hopeless. They failed and probably need to pay $89M (ie Darden Vaughn and Cherokee, who has the money) without being able to compete in the market. Their best chance is probably to sign non-compete, sign back all patent apps, nullify license indefinately (ie. give everything back) AND offer to pay some amount and get the hell out of it - go back doing brownfields or whatever... Maybe it will be cheaper than $89M. Who knows?

Gad, this guy is a consultant?

Cherokee has never been a source of funding for Industrial Heat. "Compete" in what "market"? There is no market, except for capital and investment, and they are experts at that. This is true: IH could not raise $89 million to pay Rossi for a demonstration. If they had been able to make devices that worked, they could easily have raised it, and the Woodford investment shows this. That is for, apparently, blue-sky researcher or early commercial development, not for bringing a mature technology, as Rossi's was claimed to be, to market.

The rationalization being given is that they "failed," that it took "great expertise" to operate the plant, and IH was a bunch of dodos, incompetent. Can't even run a simple 1 MW power plant. Unlike Rossi, who could do it in his sleep.

However, Rossi is talking about his strategy,. It is the same as it has always been: hit the market with cheap devices so that it won't be worth reverse-engineering them. Reverse engineering? Isn't that what one does to discover trade secrets?

So Rossi devices incorporate -- and need -- trade secrets. That indicates that the patents are invalid.

Or the whole thing is fraud.

IH held out for the possibility that Rossi would deliver the IP. It looks like he did not. Who "failed" is irrelevant, except that it was his responsibility to fully disclose what was needed. Not most of it. All of it. And all newer developments.

So, what we have seen so far is that IH has not been willing to let go of the license. Rossi imagines he can cancel it unilaterally for non-payment. Nope. Weirdly, he believes he can cancel it for nonpayment and still collect $89 million, do not pass Go. And triple damages wheeee!!!!

This is what is going to happen, as a series of continencies.

1. The suit is entirely dismissed on Summary judgment, once IH can get some facts in there.
2. Count I stands, all other counts are dismissed. Cherokee is completely off the hook, which is totally clear by contract law.
3. Count I then fails because Rossi did not fulfill his part of the contract. It is also possible IH will allege fraud, and will countersue for, well, I'd guess $30 million.
4. Count I succeeds and IH owes Rossi $89 million.
5. IH does not pay, unless Rossi brings a product to market, in which case Rossi clearly owns them the IP. They might settle at this point.
6. If IH decides it is worth it, they appeal and the matter drags on for many years.
7. IH is basically bankrupt if they don't have valuable IP from Rossi. Everything else has been put in IHHI.

Summary: Rossi is screwed. He showed that dealing with him is very, very dangerous. Who is going to trust him?

Okay, Sifferkoll and his friend will. Their choice. I hope he treats them well, unlike his Italian licensee and Industrial Heat.

However, to bring a product like the E-Cat to market will take hundreds of millions of dollars. If it works, of course. If not, it could be quite a bit more expensive, or very cheap, take your pick. The advantage of vaporware is that development costs are quite low.

IH already won. They already took their $11.5 million investment and turned it into $50 million, while Rossi sulked in his container, putting on a brave face for his fans with JONP.

He's trapped. He has to perform or he loses completely.

This is very obviuos. Woodford did not want to invest in Rossi, but in IH's project, which began before the Rossi investment and has continued through it and after it. Rossi is now basically irrelevant, probably thoroughly descredited, and will look worse and worse as more facts come out. Deja vu all over again.

He could still change that all by delivering on the IP, assuming he has IP to deliver. I don't assume that, though, it's looking very weak.

Quote from frankwtu

But it was never in the contract that Rossi should teach IH how to make devices that worked when independently tested; only that Rossi should transfer the IP and provide support

For Rossi's sake, I hope his attorney doesn't try to convince the jury of this. Oh, it doesn't matter if they can't actually make devices that work (and something that needs Rossi running it and one particular expert can't be said to 'work" as devices, only as tools for con artists), all that matters is he gave them some paper that says at the top "IP." And a bottle that says "Secret Sauce."