Archive for the ‘Biofuels & Biomaterials’ category

Complete Sentences: Biofuel RIN Fraudsters Get Long Prison Terms

December 20th, 2016

Previous posts, e.g., here and here, discussed fraudulent biofuels credits schemes in which companies falsely claim to produce biofuels and sell fake credits on the Renewable Identification Numbers (RINs) market.

A RIN is a numeric code generated by a renewable fuel producer or importer that represents a gallon of renewable fuel, and certain “obligated parties” in the fuel industry and related businesses can acquire RINs as a way to comply with the U.S. Environmental Protection Agency’s (EPA) Renewable Fuel Standard Program.

There have been a number of such schemes exposed over the last few years, and some of the individuals perpetrating them prosecuted and punished.

Two such individuals were recently sentenced to long prison terms (121 months and 135 months) for their roles in a multi-state scheme sell fraudulent biofuel credits and fraudulently claim tax credits.

The story, the general parameters of which are sadly familiar to us by now, is that the two men operated shell companies purporting to purchase renewable fuel produced by a co-conspirator companies, on which credits had already been claimed and were not eligible for additional credits.  By a series of false transactions, they transformed the fuel back into feedstock for fuel production and sold it back to the co-conspirator companies, allowing credits to be claimed again.

One of the federal prosecutors who prosecuted the case called the sentence “just punishment” for crimes that “defrauded and undermined a federal program intended to further the energy independence of our nation.”

An Environmental Protection Agencey (EPA) official involved said the agency is “committed to eliminating fraud in the renewable fuels market” and “will continue to hold criminals accountable.”

Indeed, the EPA has promulgated additional regulations to ensure oversight of RIN generation and improve the RIN market and has teamed up with the Commodities Futures Trading Commission in an attempt to improve regulation and enforcement of RINs and renewable fuels markets.

The Justice Department press release can be found here.

Know No Truth: Federal Circuit Reversal of Hearsay Ruling Saves Biofuel Patent

December 7th, 2016

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REG Synthetic Fuels, LLC (REG) owns U.S. Patent No. 8,231,804, entitled “Even carbon number paraffin composition and method of manufacturing same” (‘804 Patent).

The ‘804 Patent is directed to paraffin compositions containing primarily even carbon number paraffins and methods of making them.  Made from bio-renewable feedstocks, these saturated hydrocarbon chains are useful as phase change materials and can be used for home insulation.

Neste Oil Oyj (Neste), a Finnish oil refining company with a focus on advanced, low-emission transportation fuels, petitioned the U.S. Patent and Trademark Office for inter partes review of the ‘804 Patent.

The Patent Trial and Appeal Board (PTAB or Board) found claims 1, 3, 4 and 8 invalid as anticipated by a first prior art reference (Craig) and also found claims 1-3, 5 and 8 invalid as anticipated by a second prior art reference (Dindi).  REG appealed.

The statutory classification of the Dindi reference is crucial here:  it is a published patent application that qualified as prior art because it was filed before the ‘804 Patent application’s filing date.  This means that REG could remove Dindi as prior art if REG could marshal the requisite documentary evidence to show that the inventor of ‘804 Patent conceived of the invention before the Dindi filing date and was diligent in reducing the invention to practice.

Turns out REG did have such evidence, but the Board excluded critical portions of it as inadmissible hearsay.

On appeal, REG argued that the Board was incorrect to exclude the evidence, in particular Exhibit 2071 which consisted of emails between the inventor and third parties, in one of which the inventor stated:

[He has] had more difficulty than [he] expected trying to recover a 90+% purity nC18 product using [his] lab distillation glassware (80% purity C18 is the best [they] got).

This is significant because the claimed invention of the ‘804 Patent includes an 80 wt% purity C18 product.

The Board considered Exhibit 2061 to be hearsay because it did not verify the actual creation of the 80 wt% C18 product.

In a recent decision, the Court of Appeals for the Federal Circuit reversed this evidentiary ruling of the Board because Exhibit 2061 was not introduced into evidence for the truth of the statement therein.  Rather, the email itself provides evidence that the inventor conceived of the invention, irrespective of whether he actually created the product:

We find that the Board erred to the extent that it excluded the content of  Exhibit 2061 based on hearsay because REG offered Exhibit 2061 for the non-hearsay purpose to show that [the inventor] thought he had achieved 80 wt% purity C18 product. The act of writing and sending the email is, by itself, probative evidence on whether [the inventor] recognized – at the time that he had written the email – that the sum of the weight percentages of even-carbon-number paraffins in his compositions was at least 80 wt% and communicated this to a third party.

The court held, together with two other exhibits, Exhibit 2061 shows that the inventor of the ‘804 Patent “could create a composition with the claimed property of at least 80 wt% even-carbon-number paraffins” and was able to do so before the Dindi reference’s filing date:

[The email in Exhibit 2061] expressly states that he could achieve at least 80% purity C18 product, which was new in April 2008 because this product did not exist in the prior art, given the record before us.

So the Federal Circuit reversed the Board on conception of the invention and the admissibility of the Exhibit 2061 and sent the case back to the Board to determine whether the inventor was diligent in reducing the invention to practice, and REG and its ‘804 Patent survive to fight another day.

EPA and Commodities Commission Cooperate to Fight Biofuels Greenwashing

April 26th, 2016

EPA and CFTC

Previous posts (e.g., here, here, here, and here) have covered a rash of fraudulent biofuels credits schemes in which companies falsely claim to produce biofuels and sell fake credits on the Renewable Identification Numbers (RINs) market.

A RIN is a numeric code generated by a renewable fuel producer or importer that represents a gallon of renewable fuel, and certain “obligated parties” in the fuel industry and related businesses can acquire RINs as a way to comply with the U.S. Environmental Protection Agency’s (EPA) Renewable Fuel Standard Program.

There have been a number of such schemes exposed over the last few years, and some of the individuals perpetrating them prosecuted and punished.

According to a spokesman for a biodiesel trade group quoted in this StarTribune article, the RIN scams have hurt the biofuels industry by making obligated parties more wary of purchasing the credits from biodiesel producers.

The EPA has been taking steps to mitigate this problem, including in 2014 promulgating additional regulations to ensure oversight of RIN generation and improve the RIN market (see the story here on Biofuels Digest).

Now the EPA is teaming with the Commodities Futures Trading Commission (CFTC) in an attempt to improve regulation and enforcement of RINs and renewable fuels markets.  The two agencies recently entered into a Memorandum of Understanding (MOU) to share information and provide inter-agency advice.

In particular, the EPA will share its information on RINs and renewable fuels markets while the CFTC will advise the EPA on oversight and enforcement to reduce fraud:

The Parties intend to coordinate, cooperate and share information . . . in the possession of the EPA with regard to the RIN and renewable fuels markets in connection with the respective regulatory and enforcement responsibilities of the Parties. . . .The CFTC . . . will use the information to advise EPA on techniques that could be employed to minimize fraud, market abuses or other violations, and to conduct appropriate oversight in RIN and renewable fuel markets to aid EPA in successfully fulfilling the EPA’s statutory functions under [the] Clean Air Act . . .”

Let’s hope this inter-agency cooperation will succeed in reducing biofuels credits greenwashing.

From Burgers to Biofuels: Trademark Board Rules McDonald’s “Mc” Rights Extend to Biodiesel

August 7th, 2014

In March of 2009 Joel Joseph filed a U.S. trademark application for the mark BioMcDiesel for use in connection with marketing and selling biodiesel fuel.

Needless to say, the owner of the ubiquitous global McBrand was not pleased.  McDonald’s Corporation filed an opposition proceeding before the the U.S. Patent and Trademark Office Trademark Trial and Appeal Board (Board) requesting that the application be denied registration.

In a recent decision, the Board ruled for McDonald’s and held that the application would be refused registration.

As usual, the Board’s focus was on the likelihood of confusion inquiry, specifically here whether Joseph’s use of the BioMcDiesel mark would cause consumer confusion with the McDonald’s family of “MC” formative marks.

Although McDonald’s has been criticized over the years for trademark bullying and overextending the reach of its brand (e.g., the McSleep case), its argument here was a credible one.

The first likelihood of confusion factor was easy:  fame of the McDonald’s marks (a no-brainer).  However, the key factor that drove the Board’s decision was the similarity of the goods/services.

It turns out that McDonald’s is one of the largest suppliers of “yellow grease,” the industry term for fryer grease, for biodiesel production.  The evidence of record included multiple news articles about its biodiesel program, including one entitled “McDonald’s McDiesel”  Go Green Hawaii.”  McDonald’s also promotes its sustainability programs, including its recycling efforts, which have received considerable media attention.

The Board also noted that McDonald’s has been sharing locations with gas service stations since 1993, biodiesel fuel is sold at some of these restaurant and gas station locations, and McDonald’s uses biodiesel to run its delivery trucks (see picture above).

Thus, the Board concluded that consumers would likely be confused by Joseph’s use of the BioMcDiesel mark for biodiesel fuel:

[The evidence of record] is sufficient to show that there is a relationship between gas stations and food service/restaurants, and particularly between Opposer’s restaurants, the food items served in those restaurants, and its yellow grease, and fuel, such that relevant consumers, when confronted with the use of Applicant’s BioMcDiesel mark for biodiesel fuel, would be likely to believe there is an association as to source between that biodiesel fuel and Opposer’s restaurant services and related food products.

As to the similarity of the mark to the McDonald’s family of marks, the Board was not persuaded by Joseph’s arguments that the location of the “Mc” component in the middle of the mark and the fact that biodiesel is not a food product were sufficient to distinguish it.

The Board noted that the McDonald’s family is not limited to marks in which the “Mc” formative is at the beginning of the mark, citing CHICKEN MCNUGGETS, EGG MCMUFFIN, and SAUSAGE MCMUFFIN.  Also, because the McDonald’s marks are so famous, “when third parties use the “Mc” formative, it engenders a similar commercial impression.”

You should think twice before pouring your resources into those McSolar and McWind brands!

More Green Patent PR: Phytonix, Proterro and Others Tout Patents and Licenses

August 4th, 2014

I’ve written before (e.g., here and here) about tech firms’ penchant for patent PR.  Here are several recent contributions to the genre.

 

Phytonix Corporation, based in North Carolina, touts its new U.S. patent for biobutanol production technology in this press release.  The patent is U.S. Patent No. 8,735,651, entitled “Designer organisms for photobiological butanol production from carbon dioxide and water” (‘651 Patent).

The ‘651 Patent is directed to a biosafety-guarded photobiological butanol production technology based on designer transgenic plants, designer algae, designer blue-green algae (cyanobacteria and oxychlorobacteria), or designer plant cells.

But the company’s IP portfolio doesn’t end here; Phytonix wants you to know that it also has IP relating to its biosafety guarded technology that “uses redundant mechanisms to prevent the proliferation of our organisms outside of a chemicals & biofuels productions environment.”

Query whether Phytonix directly competes with  biobutanol industry leaders Butamax and Gevo, who have been embroiled in contentious patent litigation.

 

Meanwhile, Ion Power Group (IPG) has been busy patenting not only in the U.S. but also in Canada, China, Japan and Russia.  The energy R&D company’s IP law firm announced that IPG’s “ground-breaking” ion power plant technology is the subject of “international patents.”

The press release does not contain the patent numbers, but specific patent info can be found on the company’s patents page.

 

New Jersey-based Proterro recently announced the grant of U.S. Patent No. 8,728,783, succinctly titled “Photobioreactor” (‘783 Patent).

The ‘783 Patent is directed to a photobioreactor for cultivating photosynthetic microorganisms comprising a non-gelatinous, solid cultivation support suitable for providing nutrients and moisture to photosynthetic microorganisms and a physical barrier covering at least a portion of the surface of the cultivation support.

The news was picked up by Biofuels Digest.  The press release also mentions a new Mexican patent and a prior U.S. patent covering the company’s sucrose-producing cyanobacteria.

 

Of course, not all green patent PR pertains to patent grants.  Some relates to tech transfer.  In this vein, Innovative Environmental Technologies (IET) recently announces an exclusive licensing agreement with Provectus Environmental Products.

IET said the deal involves seven patents, including U.S. Patent No. 7,828,974, with the positively prolix title “The induction of reducing conditions and stimulating anaerobic process through the addition of dried micro-blue green algae and seaweed to accomplish accelerated dechlorinization of soil and groundwater contaminated with chlorinated solvents and heavy metals” and U.S. Patent No. 8,147,694, entitled “Method for the treatment of ground water and soils using mixtures of seaweed and kelp.”

The press release can be found here.

By the way, this breakdown of green patent PR subject matter – the majority being directed to patent prosecution events – is consistent with my findings on patent PR in the clean tech industry discussed here.

More Greenwashing 2.0: Another Biofuels Credit Fraud Scheme Exposed

July 21st, 2014

In previous posts (e.g., here and here), I’ve discussed cases of fraudulent renewable energy credits and other environmental crimes and argued they ought to be considered greenwashing.

A recent indictment is another case in point.  The U.S. Department of Justice (DOJ) recently announced that a federal grand jury in Houston, Texas indicted an individual for allegedly selling fraudulent renewable identification numbers (RINs).

The indictment alleges that an individual using the name Philip Joseph Rivkin operated and controlled several Houston-based fuel companies including Green Diesel LLC, Fuel Streamers Inc. and Petro Constructors LLC.

The defendant allegedly claimed that Green Diesel produced millions of gallons of biodiesel at its Houston facility then generated and sold about 45 million RINs based on the claim.  However, according to the indictment, Green Diesel did not actually produce any biodiesel at its facility.  The defendant allegedly made millions of dollars selling the fraudulent RINs.

This type of fraudulent activity undermines the policy goal of RINs – to ensure a certain level of renewable fuel in U.S. gasoline – by damaging the market for valid RINs and ultimately reducing the actual volume of biofuels in circulation.

According to a spokesman for a biodiesel trade group quoted in this StarTribune article, the RIN scam has hurt the biofuels industry by making obligated parties more wary of purchasing the credits from biodiesel producers.

The fraud and resulting damage are recognizable when we view the putative RIN purchasers as green consumers, albeit commercial consumers instead of individuals, falling victim to false representations about the validity of renewable energy-based financial products.

In apparent recognition of the damage caused by fraudulent RINs, Biofuels Digest reported that the U.S. Environmental Protection Agency recently finalized additional regulations to ensure oversight of RIN generation and improve the RIN market.

On Green Patenting, Sewage Sludge, and EPA Rulings and Regulations

February 25th, 2014

Environmental regulations can, of course, impact the development and implementation of green technologies.  This can happen on an industry level, for example, when automobile fuel efficiency technology is improved in response to rising CAFE standards.

It can also happen on a smaller scale and affect one company at a time, such as MaxWest Environmental Systems (Maxwest), which has developed gasification technology to break down sewage sludge.

The U.S. Environmental Protection Agency (EPA) recently ruled that MaxWest’s patented gasifier is not an incinerator and therefore will not be regulated as such.  According to the company, this means the technology can be developed and implemented at a lower cost to municipalities (see the press release here).

MaxWest owns at least one patent and one published patent application relating to its gasification technology.  U.S. Application Publication No. 2013/0195727 (‘727 Application) is entitled “Fluidized bed biogasifier and method for gasifying biosolids” and directed to a gasifier and methods of gasifying biosolids obtained from sewage sludge.

A fluid bed gasifier (200) includes a bubbling reactor bed section (204) which receives sewage sludge through feed inlets (201) and flue gas through a flue gas inlet (203).  The gasifier has a freeboard section (205) between the reactor bed section (204) and the outlet (210) of the gasifier.

 

A cyclone separator (207) separates material exhausted from the fluidized bed reactor into clean producer gas for recovery and ash for disposal.  An oxygen monitor (209) may be used to help control oxygen levels in the gasification process together with a producer gas control (208), which monitors oxygen and carbon monoxide levels in the producer gas.

It appears that the control of oxygen levels was critical to the EPA ruling.  According to the ‘727 Application, the biogasification process occurs in an “oxygen starved environment” which prevents combustion.  Because there is no combustion, the gasifier is not classified as an incinerator.

An older gasifier technology is described and claimed in MaxWest’s U.S. Patent No. 7,793,601 (‘601 Patent), issued in 2010 from an application filed back in 2005.   The ‘601 Patent is entitled “Side feed/centre ash dump system” and directed to an apparatus for gasifying solid fuel where the biomass feed material is introduced into the primary oxidation chamber (400) through in opening (408) in the side of a wall (402) or in the floor of the chamber (400).

The wall (402) has multiple layers, and the innermost layer (405) is made of a high-temperature refractory material capable of withstanding elevated temperatures.  According to the ‘601 Patent, the wall (402) is therefore capable of allowing oxidation of biomass while maintaining a tolerable skin temperature on the outside of the wall.

More Green Patent PR: Aphios Announces Grant of Cellulosic Biomass Patent

February 18th, 2014

Readers of this blog know that I have a soft spot for patent PR, particularly green patent PR (see, e.g., here and here).  So I’m always interested in covering announcements by green tech companies about their patents.

Aphios, a Massachusetts company that develops technology for cellulosic biomass conversion, recently put out a press release announcing the grant of U.S. Patent No. 8,540,847 (‘847 Patent).

Entitled “Methods and apparatus for processing cellulosic biomass,” the ‘847 Patent is directed to methods and apparatus for making ethanol or other biofuels using what Aphios calls its Aosic process.

The apparatus (11) described and claimed in the patent comprises a first vessel (13) for receiving cellulosic biomass and conveying means (15) in fluid communication with the first vessel (13).  The apparatus (11) also comprises supercritical, critical, or near critical fluid means (17), which includes a source of gas, such as gas tank (41), holding carbon dioxide pressurized to form supercritical, critical, or near critical fluid.

The fluid means (17) is in fluid communication with conveying means (15) via conduit (31).  A pump (47) is connected to a heat exchanger (55), which controls the temperature of the supercritical, critical, or near critical fluid.

The cellulosic biomass is loaded into the first vessel (13) and becomes laden with the supercritical, critical, or near critical fluid.  Discharge means (21) is in fluid communication with the conveying means (15) for receiving cellulosic biomass laden with the supercritical, critical, or near critical gas and discharging  the gas to form a disrupted cellulosic biomass.

A second vessel assembly (23) may include a hydrolysis vessel (23a) and a fermentation vessel (23b) for further processing of the cellulosic biomass.  Discharge means (21), including a discharge pipe (71) is connected to a turbine (73), which captures the kinetic energy of the expanding gas.  The turbine (73) is coupled to an electric generator to recover and recycle energy from the process.

According to the press release, contacting the cellulosic biomass with the supercritical, critical, or near critical fluid or gas improves the process by separating the fibers of the biomass:

In the Aosic process, biomass is contacted with SuperFluids such as carbon dioxide with or without small quantities of polar solvents such as ethanol, both sourced from the downstream fermentation process.  Pressure is released and fibers are made more accessible to enzymes as a result of expansive forces of SuperFluids (about 10 times those of steam explosion) and carbonic acid hydrolysis.

The ‘847 Patent says the process provides biomass recovery yields between 95 and 99 percent.  Thanks to Biofuels Digest, from whence I picked up the Aphios news.

Betting on Biobutanol and Battling Butamax: A Conversation with Gevo’s General Counsel

September 11th, 2013

 

One of the biggest green patent stories in the last few years has been the burgeoning biobutanol battle between Gevo and BP-DuPont joint venture Butamax Advanced Biofuels.

As with other industries, clean tech companies engage in PR around their patent matters, and this patent litigation is no different.  Part of this green patent war has been fought through PR. 

So when I was offered the opportunity to speak with Brett Lund, Gevo’s Executive Vice President and General Counsel, about this litigation I jumped at the chance.

For starters, this is a very important battle.  The email offer to interview Mr. Lund noted that it’s the “first-ever litigation in the industry of advanced biofuels, and it’s not just one patent – it’s a patent war over who can make isobutanol.”

Lund echoed this point, telling me there are just two main players for isobutanol (there is something called n-butanol, but it’s a less desirable fuel). 

Isobutanol is a very good petroleum substitute and the “ideal molecule” for both fuels and chemicals.  A a water insoluble 4-carbon molecule, it doesn’t get diluted and can be put in pipelines and directly into a refinery.

 Our conversation got into some of the details of the patents initially asserted by Butamax – U.S. Patent Nos. 7,993,889 (’889 Patent) and  7,851,188 (’188 Patent). 

Lund said the patents relate to a naturally occurring isobutanol pathway that has “been around forever.”  Known for over 50 years, Lund told me this 5-step pathway can be used to make very small quantities of isobutanol for things like sake or beer, but it’s hard to produce in large quantities suitable for fuel use.

Gevo’s patents, on the other hand, relate to new, non-naturally occurring pathways that boost isobutanol production.

Lund and I also discussed Gevo’s counterclaims for infringement of U.S. Patent Nos. 8,017,375 (’375 Patent) and 8,017,376 (’376 Patent), directed to recombinant yeast that harbor a variety of genetic modifications helpful for isobutanol production.

While Gevo believes that Butamax’s design-arounds of the ‘375 and ‘376 Patents are covered under the doctrine of equivalents (DOE), a recent court decision held otherwise, granting Butamax’s motion of summary judgment that it does not infringe the patents, literally or under the DOE.

When asked why the proactive PR, Lund noted that Gevo is a public company with lots of investors and partners and “we want people to know the truth.”  He went on to say that Gevo highly regards patents and patent law.

With respect to Butamax’s patentsand applications, he told me Gevo knows about them, actively monitors them, and continues to be careful and cognizant not to use Butamax’s technology.

This important green patent war is likely to continue in the courtroom and the media.

Velocys Biomass Reactors: Microchanneling Intense Reactions

August 15th, 2013

Velocys, part of the Oxford Catalysts Group, is an Ohio company that develops technology for the production of synthetic oil from waste gas, coal, and waste biomass. 

Velocys owns at least 84 U.S. patents and published patent applications, including a family of patents that issued from an application originally filed in 2003.  These patents include U.S. Patent Nos. 7,402,719, 7,744,829 and 8,106,249.

The patents are entitled “Catalytic oxidative dehydrogenation, and microchannel reactors for catalytic oxidative dehydrogenation” (Dehydrogenation Patents) and cover what appears to be the company’s first generation microchannel reactor technology.

Microchannel reactors contain thousands of millimeter scale channels that quickly dissipate heat from the chemical reactions so more active catalysts can be used.  Fischer-Tropsch (FT) reactors use effect heat dissipation by interleaving channels containing catalyst with water-filled coolant channels. 

According to the Velocys web site:

The use of microchannel processing makes it possible to greatly intensify chemical reactions enabling them to occur at rates 10 to 1000 times faster than in conventional systems.

The Dehydrogenation Patents are directed to apparatus and methods of oxidatively dehydrogenating a gaseous hydrocarbon in which the reaction chamber has walls (6, 6′), a process channel (2) contains a bulk flow path (4), and a heating chamber (10) is adjacent to the process channel (2).

The heating chamber is divided into several regions (7, 9, 13) into which various fluids flow to tailor the temperature profile in a process channel.  In one example, the Dehydrogenation Patents state:

[S]team or the return portion of [an oxidative dehydrogenation] stream could flow through region 7 to provide a preheat zone; an endothermic process stream can flow through region 9 to remove heat from the oxidative dehydrogenation reaction in a reaction chamber (a portion of the process channel in which catalyst 15 is present), and a cold fluid flows through region 13 to quench the reaction.

As shown in FIG. 3A of the Oxidative Dehydrogenation Patents, the channels may have apertures (38) forming passageways between channels (36 and 37) to allow flow of a reactant into the endothermic reaction chamber.

Velocys also has more recent patent applications relating to subsequent developments in its microchannel technology, including U.S. Application Publication Nos. 2012/0095268 and 2013/0127093, which includes the claimed step of ultrasonically packing particulates into the microchannels using an ultrasonic densification unit.

The Velocys FT reactor technology was recently selected for a biomass-to-liquids plant to be developed by Red Rock Biofuels and partially funded by a grant from the U.S. Department of Defense.