EES settles dispute

Environmental Energy Services Inc. settled a lawsuit against a Charlotte, N.C. company it had considered selling out to in 2008, claiming the prospective buyer poached a lucrative contract from EES.

Environmental Energy Services did not disclose the terms of its settlement with CoaLogix Inc. and its parent company Acorn Energy Inc., and did not disclose what impact the settlement might have on its portfolio of products and services. A message left for EES President Richard Nowak was not returned.

Founded in 1991 and based in the Sandy Hook section of Newtown, EES sells fuel additives and systems to help utilities reduce harmful emissions from power plants that use oil or coal as fuel. EES is not affiliated with a Boise, Idaho oil and gas exploration company of the same name.

EES has received some $1.3 million in backing from Connecticut Innovations, a state-funded venture capital group based in Rocky Hill. The largest customer EES has revealed to date is Florida Power & Light Co.

According to EES”™ lawsuit, in 2008 it began discussions for a potential agreement to sell out to CoaLogix, which was formed by Acorn Energy and EnerTech Capital Partners the previous year to sell catalytic conversion technology not dissimilar to that of EES.

In the course of sharing information prior to the merger, CoaLogix learned details of an agreement with Solucorp Industries Ltd. under which EES had an exclusive right to sell Solucorp systems in time to more than 40 unspecified U.S. utilities to cut mercury emissions in coal-fired power plants. Solucorp has its U.S. headquarters in West Nyack, N.Y. in Rockland County, and had not been named as a defendant in the lawsuit.

After learning of successful demonstrations of the technology at a Reliant Energy plant east of Pittsburgh and one run by Montana Dakota Utilities in Billings, Mont., CoaLogix then approached Solucorp with the intent of acquiring an exclusive license itself, according to EES. In May 2008, EES said Solucorp assigned the exclusive rights for the technology to CoaLogix for 10 years in exchange for $2 million, and CoaLogix indicated it expected to receive $70 million in revenue over the first five years of the deal.

In addition to damages, EES had sought any revenue CoaLogix would receive as part of its side deal with Solucorp.

For its part, CoaLogix had denied the allegations. Last month, the company was named to the GoingGreen East list of 50 top environmental companies, published by AlwaysOn. Parent Acorn Energy also runs Coreworx, whose software is used in the construction of power plants; Gridsense, which monitors utility transformers; and DSIT, which sells sonar systems to detect underwater threats to coastal installations.