Petro-Sog, Ltd Lawsuit filed in 1994

I came across a lawsuit filed in 1994 in Texas.  The lawsuit is titled "Petro-Sog, Ltd v. Federation of Research Chemical Engineering, Inc., Bahman Abtahi, Bruce Akbari, and David Feuerborn" ("Petro-Sog Case").  This case was filed in Texas State Court in Harris County, Texas in the 280th Judicial District as Case # 96-50513.  The Petro-Sog Case is not listed on PACER because it was filed in Texas state court, but it can be found at the Harris County Courthouse or by using their online document retrieval website.  It took some digging, but I have summarized the relevant information below.

Case Summary:

Feuerborn, Akbari and Abtahi were operating under the company Federation of Research Chemical Engineering, Inc. ("FORCE") that had a solvent called Reneu.  Reneu is the product that ESS investors know as R6000.  David Feuerborn was the President of FORCE which was based out of Baldwin Park, California.  Reneu purportedly, "has an ability to separate hydrocarbons from liquids, separate hydrocarbons from solids, separate sulfur from hydrocarbons, and to act as a de-emulsifying agent" (Petro-Sog Case, Original Petition Page #4, Paragraph 10).  The Original Petition goes on to state that FORCE "sought to sell a large interest in its technology" (Petro-Sog Case, Original Petition Page #4, Paragraph 11).  The Original Petition goes on to state the following:

"On October 14, 1994, [FORCE] shared its technology and trade secrets regarding Reneu with a representitive of [Petro-Sog].  During this meeting, [Petro-Sog] learned that [FORCE], Abtahi, Akbari, and Feuerborn had made certain representations regarding Reneu that were false and untrue to induce [Petro-Sog] to enter the Agreement.  Among other things, [FORCE], Abtahi, Akbari, and Feuerborn falsely represented to [Petro-Sog] that Reneu had certain characteristics and abilities that it did not have or posses.  In particular, [FORCE], Abtahi, Akbari, and Feuerborn falsely represented that:

a.       Reneu and its reactants and products did not represent an environmental risk;

b.      Reneu and its reactants and products did not have any special disposal requirements;

c.       Reneu and its reactants and products did not have special handling and storage requirements;

d.      Reneu and its reactants and products did not require special EPA testing and/or approval;

e.      Reneu and its reactants and products did not possess chlorinated solvents; and 

f.    Reneu and its reactants and products are ready for commercial production” (Petro-Sog Case, Original Petition Page #5, Paragraph 15).

Judge Ruling:

"The Court found and now finds that each of the Defendants, [FORCE], Bahaman Abtahi, Bruce Akbari and David Feuerborn, committed actual fraud against the Plaintiff, [Petro-Sog]" (Petro-Sog Case, Final Judgment Page #1, Paragraph 2).

- ESS Investor