The New Fizzle

Facts are facts, or why Darden will lose the ECAT Case

This is a post, last updated in August, 2016, on, a site apparently owned by Rends, a moderator. I never saw any abusive moderator actions by him on lenr-forum, but when Alan Smith claimed to have the support of Staff, in his deletion actions and perhaps for his later ban, he could be part of that.

The blog is full of misinterpretation and conspiracy theory. The tagline is “Supporter of the LENR Revolution”, but, in fact, this is Planet Rossi, at its worst.

I received an email asking about a claim made on the blog page, so I’m looking at it in detail.

Facts are facts, or why Darden will lose the ECAT Case

UPDATE 13.08.2016

AMENDED ANSWER, ADDITIONAL DEFENSES, COUNTERCLAIMS AND THIRDPARTY CLAIMS Rossi_vs_Darden_et_al_Amended_Answer_with_all_Exhibits_2016_searchable

Nice document. Could be useful, except that I think what we have is more useful. First of all, we have all the case pages except for some early boilerplate which could be added if anyone cares. The above is 265 pages, and is only one document, and is now obsolete, because the Answer was Amended three times. Using that monster would be cumbersome, compared to IH Answer Merge with Rossi Claims and Rossi Answer Merge with IH Claims

Both of these have links to the Exhibits, in situ, very fast to load in a new tab, directly from reading the text, so the reader will not lose their place. All case pages are found indexed and available from Rossi v. Darden case files.

Rends starts with a Bloomberg listing for Industrial Heat, which tells us nothing that was not already obvious.

1. Andrea Rossi negotiated from the beginning of the business relationship exclusively with representatives of Cherokee Investment Partners, in particular with CEO Thomas Darden and Manager JT Vaughn, the prove are all the headers of the email communications which the Jones Day lawyers published in the Exhibit 13 of ANSWER AND ADDITIONAL Defenses.
Darden was an officer of Cherokee, and IH was formed as the investment vehicle, and was apparently — we still do not have, publicly, full evidence — acting on his own, with Vaughn. IH denies that Vaughn a Manager of Cherokee, but that refers (they are explicit) to the legal definition in the law of the state of LLC formation. There is an issue as to whether they “represented” Cherokee or not. Rossi claims they did, and Rends here follows the Rossi story line. A Cherokee investment in Rossi technology would be very much outside the normal business area of that LLC, and Rossi signed an Agreement with Industrial Heat, very explicitly, with an Entire Agreement clause in it that disavowed any prior representations, and if Rossi had been confused about this and not want an arrangement with IH instead of Cherokee, he had a year in which to change his mind at no cost and maybe even a modest profit, i.e, the interest on $1.5 million. He chose to take $10 million, instead, to move ahead with the Agreement as it was.
Rends shows his tweet:

Case – Jones(Bad)Day – “Defendants deny that Vaughn is a Manager at Cherokee” 

The linked page has, “JT Vaughn is a venture investment manager with Cherokee.”  Rends seems to think there is a contradiction here, because he does not understand what a “manager” is, legally. I have not researched the specific law, but it is likely that a “manager” has the authority to bind the company. A “manager” is managing the company itself. Cherokee forms “ventures” and invests in them, each venture being an independent LLC, with Cherokee as a founding investor, perhaps. In that case Cherokee puts Cherokee money into the LLC. It would appear that Vaughn manages those. Cherokee generally does not commit itself beyond investing whatever they invest, which they could, and sometimes do, lose.
Update 13.08.2015 – Jones Day reacted and defined what they and the law understand as ‘Manager’, but they forget that Cherokee and Industrial Heat LLC are for the court more or less the same company and a Vice-President is for sure a Manager.
Rends is clueless about U.S. law and procedure (I think he is German). No, a Vice-President is not a Manager in any important sense here, but this is all actually moot. They merely denied it because, legally, it was not true. The court cannot and will not treat Cherokee and IH as “more or less the same company.” When the Judge allowed the case to proceed against Cherokee, she assumed Rossi claims were true, including the “Manager” error and that Cherokee was sole owner of IH. That would have made them the same. But that was obviously incorrect, and will never be accepted by the Court, outside of a Motion to Dismiss, where every claim of the plaintiff is taken as true. Such a decision would do violence to fact and law. There is now a sole owner of IH, and it is not Cherokee, it is IH Holdings International, Ltd., a U.K. company formed to receive the $50 million Woodford investment; it has many shareholders, though. Defacto control is with the two shareholders who collectively have a majority of the voting stock, Darden and Vaughn. However,  as officers of IHHI, they are responsible to all the shareholders.
And Jones Day seems to have more information about John Doe, he seems to be a resident of Florida:
Rends makes a fuss over standard legal practice. If one is suing someone, and is not certain of the real name, John Doe is often used. IH was attempting, through Discovery process, to find John Doe, or James A. Bass, and the Magistrate ordered Johnson (President of Leonardo Corporation and of J.M. Products Inc., the alleged customer whom Bass allegedly worked for) to provide contact information for Bass so that Bass could be legally served notice of the suit, or else the proposed IH subpoena of J.M. Products phone records would have been issued. Apparently Johnson complied. All of this is now moot. Bass has legally appeared, through the same attorney as Johnson.
 2. The by Cherokee Founder & Chief Executive Officer Thomas Darden later opened Industrial Heat, LLC (with JT Vaughn as Vice-President), as well as their later (under conspiratorial circumstances) by Thomas Darden and Cherokee Founder & Managing Principal John Mazzarino founded parent companies – IPH INTERNATIONAL BV – Kepler 34, II7ICD Badhoevedorp, Netherlands, – IPHBV Holdings Ltd – London UK 1 Finsbury Circus, Liverpool Street, – IH Holdings International Limited – London UK 1 Finsbury Circus, Liverpool Street are clearly companies of Cherokee Investment Partners (Owned by the CEO and Principal), established for the purpose of own exploitation and are in no way independent.
Rends is looking at a situation that he doesn’t understand, but making declarations about it. He is totally confused about Cherokee, which is clearly an independent company. Apparently no Cherokee money was invested in IH. It was not a shareholder. It has no ownership interest in the other companies. The connection is that some officers are the same. IH and the rest are essentially personal investments and activities organized by Darden and Vaughn. They invested in it, possibly some of their own money, but through other LLCs that they manage, LLCs that could invest in such activity. Not  Cherokee. To be clear, these are the relationships:
IH was founded in 2012 to handle LENR investments. It  was funded through a stock sale with an initial subscription limit of $20 million, with $11.5 million raised immediately, which happens to be, no coincidence, the money given to Rossi in 2012 ($1.5 million) and in 2013 ($10 million).
In 2013, IPH was formed to be an IP holding company for LENR licenses, and the Rossi License was assigned to IPH. IPH is wholly owned by IH (and is properly a co-defendant in the Rossi suit).
IHHI was formed in the U.K. in 2015 to receive the Woodford investment of $50 million, and we just learned that they may have committed an additional $100 or $150 million, date or terms not revealed, but the IHHI plan, as revealed in U.K. filings is to spend the current assets on LENR research and to require more investment, this is consistent with that.
IHHI appears to have purchased all the IH stock, likely in return for stock in IHHI. So IHHI is now the sole owner of IH, which probably has no major assets of its own, other than the Rossi license. It is an operating company, whereas IHHI is a holding company. So the lab or facilities in North Carolina are IH activities, but probably funded by IHHI. Researchers are crediting IH for support, but, again, that is likely coming from IHHI.
IHHI is not liable to Rossi for anything. They are not a party to the lawsuit.
Rends then shows The Fog, a complex web of interreleationships between companies. I have previously deconstructed this. It  is basically unclear and vague conspiracy theory that sees connections based on the thinnest of evidence or relationships.
3. The presumption of conspiratorial technical and documentary manipulation by Rossi, Penon, Fabiani especially of the flow meter are very unlikely as calculations show. It could be assumed that even the in the Lawsuit reported ‘COP of more than 50’ is too low and with the by Murray in Exhibit 5 (INITIAL QUERIES FOR M. ENG FABIO PENON AS tO MEASUREMENTS oF 1 MW PLANT (at 7861 NW 46th Street, Doral, Florida;. February 16-17, 2016) transmitted data would be the COP still at least be 8.7 and would more than satisfy the requirements of the license agreement.
IH has presented a pile of evidence showing possible conspiracy. It is not a “presumption,” it is a claim based on evidence, and the evidence is strong enough that Rossi is going to have quite a time surviving it. He has Answered those claims without providing any contrary evidence, merely denials.
Rends’ analysis here is incoherent. Exhibit 5 is simply a list of questions asked of Penon by Murray, the IH engineeer. It reveals some of the data from the preliminary reports issued by Penon, indicating some … let’s call them “anomalies.” Facts that indicate something is fishy. Legally, at this point, IH does not have to prove “COP.” However, they have alleged that there was no cooling equipment present in the building adequate to handle the alleged megawatt of power generation.
Rends presents an analysis of the Flow Meter data, as a post on lenr-forum, but completely neglects the possibility of major flow meter error due to a partially filled pipe. Was the pipe full or not? We don’t know. Murray raised the question, Penon did not answer, but Murray did see a rust line indicating that the pipe was not full.
The legal point  being made is that there was possibility of massive error here, confirmed by what I call the “room calorimeter,” the lack of cooling equipment, and Penon stonewalled and issued his report without addressing the questions. It  would be preposterous for a company to be expected to pay $89 million under those conditions. And Penon is apparently a kind of fugitive from legal process.
Exhibit 5  shows how helpless Darden and Jones Day are, because the ‘expert’ Joseph Murray is no specialist for flow metric, he is an analyst for digital system and it looks like that he was hired by Industrial Heat/ Darden just because he is from Raleigh-Durham N.C.
And Joseph Murray himself seem to have no real interest to be involed in this case, because his LinkedIn Jobdescription – Strategic and Technical Management Independent Consultant since June 2015 – does not indicate that he is a loyal and proud employee of Industrial Heat LLC.
The Linked-in profile has, now,
Vice President, Engineering, Institutionally Funded Venture Startup (1 year 7 months) Cary, North Carolina

Institutionally funded startup focused on clean energy technologies. Founded by the principals of Cherokee, including Tom Darden; investors include Woodford Investment Management, a leading U.K. investment firm.

Rends’ comments are legally irrelevant. The man has extensive engineering education, and executive experience as an engineering manager, which is what he was hired for. He doesn’t have to be a specialist in flow metrics, and would not be called on to testify as such. This is classic on Planet Rossi. They have no clue what is actually happening in the case. It does not primarily hinge on whether or not the Doral Plant generated a megawatt. However, IH presents simple, easy-to-understand evidence that it did not. The Murray document simply shows a few facts indicating possible suspicion of error, asks some rather obvious questions based on this, and the presentation in the counter-complaint shows that Penon did not answer the questions, but sent his report with no response. The supposedly neutral ERV — according to Rossi — who was actually paid, we think, by Industrial Heat, to provide measurements for a sale of power and demonstration site for possible investors, refused to answer some fairly simple questions. Penon did not respond as a professional, and it is absolutely no surprise, then, that he is being sued, and that he is avoiding showing up, which is going to be a great difficulty for Rossi since, for him, the Penon Report is crucial, and without Penon to testify — and answer questions about it — the Rossi case falls apart. He has nothing without that report and the document has almost no weight without Penon testimony behind it.
And this is the kicker: legally, as to what we can see from what is available to the public at this point, Rossi’s claims are unfounded, without any consideration of what Penon wrote, for Rossi apparently did not follow the procedure for setting up a “Guaranteed Performance Test.” It was grossly different from what would have been legally binding on IH. I consider it likely that the case will never make it to trial, on the Rossi claims. But on the other side, it’s another story!
Rends went on to present one side of an analysis that was made in some depth on lenr-forum. Without more data and without an examination of that meter and the system, it’s impossible to be sure about what happened, and Penon removed the flow meter, taking it away, at the end of the test, purportedly sending it back to the manufacturer. An attorney friend took one look at that and said “spoliation.”
By that point, IH was being represented by Jones Day and Rossi by Annesser of Silver Law Group. It was known that IH did not accept the Doral Plant as a “Guaranteed Performance Test,” nor Penon as “ERV.” This was in a letter to Rossi at the beginning of December, 2015. Rossi has told his followers many lies about what happened, both in this sequence and before. That is what is coming out, clearly. 
4. Furthermore, there are still patent applications of Industrial Heat, LLC, one is a complete plagiarism of the Lugano report and technically based on the ECAT design of which Thomas Darden axed, it does not work.
This is meaningless. Rends does not understand patent law and why that application was filed (nor did Rossi, apparently). The Lugano report was about to issue. IH had made the Lugano device, using Rossi instructions. If they had not filed that patent, I’m given to understand, the IP would have passed into the public domain. So they wrote a quick patent and then, when it was available, put the Lugano report into it. As a patent, it was horrible (I remember pointing this out), except that patents can be revised. It would have accomplished the goal of protecting the IP.
Patents do not have to work. Many patents don’t. What a patent does is establish priority of claims. If the patent doesn’t work, it’s worthless, but nobody is prosecuted for “false claims.” Rossi claimed patent infringement with regard to this patent. That claims was dismissed, it was preposterous, a sign of a clueless attorney that it was even filed. (Or Rossi insisted in spite of attorney advice.)
5. The Exhibits 18 shows that Industrial Heat, LLC has sold and billed energy to JM Products Inc. until the end of the performance test. This cannot be explained to any judge on this earth, how a respectable businessman can sell something in his own name over a period of nearly one year and then afterwards claiming, that the own product did not even exist and that there is additionally no real costumer.  But as Magistrate John O’Sullivan states “…all that money is taxable” so we will see…
This was sloppy, totally careless, and that Rends has not corrected this, five months later, shows just how competent he is — or is not. Exhibit 19 shows no billings to JMP. Rather, it is a set of invoice requests from JMP, asking that IH invoice them. I have argued that IH could have billed JMP without harm, by being very clear in the invoices that this was per the agreement and based entirely on the representations of JMP, i.e., of Johnson, and not on their own measurements. However, it appears that they did not do this. We do not know if they were ever paid anything by JMP. If they were, it could be without any invoice. As to what the Magistrate said, that would be the core of my argument as to why they should have invoiced. To follow the money, later, if necessary.

6. Jones Day is focusing its legal efforts in the direction of establishing that there has been no real customers and JM Products Inc. is only a facade.

This raises the question of whether this has ever any relevance, because even if the customer is a fake, so this is completely irrelevant to the test result of 1MW reactor.

The customer was supplied with energy, Industrial Heat LLC has provided this energy, deliveries over the period of one year, accounting per month, IH and has been paid and what the customer ultimately does with the energy, if he blows the heat in the air, boils a coffee , or melts ice is all alone of the customer and completely irrelevant to the license agreement between Leonardo / Rossi and Cherokee / IH / Darden.

Jones Day has to prove that the 1MW reactor is not working and that therefore the ERV Report by Penon is a fake, that is the core, all the other issues around this main topic are of course interesting for the audience, getting an insides view, seeing how ‘gentle’ businessmen are, but for the case it is irrelevant.

It could seem like this to someone who has not been paying attention, someone who already has strong idea of who is right and who is wrong, and who then looks for reasons to continue with the same beliefs. Most Rossi supporters are backing up, starting to become cautious, starting to think that even if he has a real technlogy, perhaps he exaggerated, perhaps he was impatient to set up the GPT, so he took a little “creative action.” Which involved, perhaps, what IH is claiming. IH has layers of defense and offense, Rossi was totally naive to sue them. Even if he has a real technology. 
However, Rossi avoided independent testing for years. He only allowed IH to independently test his designs because they paid him, and he thought he could extract more money from them. He went a bridge too far. What the whole affair has shown is that Rossi cannot be trusted. He is deceptive. And that calls his entire technology into question.
At this point, Rossi is not legally obligated to prove his claims, and he can deny the IH claims and need not prove his denials. However, IH has shown plenty of evidence that is quite obvious, and that will be very easy for a jury to understand. If the test was flawed, and it was flawed, there is no doubt about it, and this is not about whether there is heat or not, it is about Rossi manipulating conditions so that he would have complete control, and could fake results if he wanted to, or not. That was not the conception of a GPT. It was originally to have taken place in the IH facility in North Carolina. We see from the email that Rossi rejected a power installation there, and proposed the Doral power sale instead. It’s going to be obvious to a jury, if it gets that far, but because of lack of evidence that IH actually agreed to the start date in Doral as beginning a GPT, it is likely that the Rossi suit will be dismissed with prejudice as to that test. It was invalid.
Note to self: if I ever am involved in an agreement involving $100 million, be sure to consult with an attorney and listen carefully to the advice, and then follow the terms of the agreement to the letter, no “sort of, quick and dirty,” no relying on estoppel instead of what was required, a written consent of all the parties. And if I can’t get that, don’t put in a wasted year babysitting an invalid test. Instead, if I’m ready and they aren’t, negotiate and, if necessary, sue for specific performance. Not  for fraud and $270 million. There can be some blowback when you sue a $2.2 billion corporation for fraud. They don’t like it, and they have the resources to screw you over a dozen times before next July. 
7. And last but not least there is still this presentation which was hold [sic] 2015 in China by Thomas Darden as CEO of Industrial Heat, LLC.
Rends cited this document on lenr-forum. The earliest mention I found is a twitter post by Alain Coetmeur (also a lenr-forum administrator) 29 February, 2016, and Alain gives a little more information. This enabled me to find a more original coverage on lenr-forum, November 2015.
Darden was in China October 20, 2015, for a ceremony, so people have assumed that this was a speech he gave.
I could not see the original file location web site, it was not responding. The Internet Archive did not have a copy.
However, it’s amazing what we can find if we just look. When was that document created? I downloaded it and looked at it with the free Acrobat Reader, under Properties.
Author:  John Vaughn
Modified: 10/13/2013 11:21:15 AM
Bingo! At this point, IH had paid Rossi the $10 million and had received delivery on the 1 MW plant. They were working with the technology, and apparently had high hopes for it. We do not know when this slide show was presented, nor by whom, but I consider that it was not likely that Darden, in October, 2015, would give a presentation prepared two years earlier. It was likely shown, if it was shown, much earlier, before IH had experienced some years of failure to see excess heat with independent testing of the Rossi technology.

These seven points [from the presentation] alone indicate the substantial contradictions the Jones Day lawyers have to overcome and it almost looks as if they made a lot of big mistakes, just because their own clients are holding back information and therefore Jones Day cannot properly advise Darden

The opportunities for Jones Day to invalidate these contradictions are very low, thus Darden will lose this case.

That was Rends’ conclusion. I think I’m finished with that web page. If this gets back to Rends, perhaps he might reconsider what he wrote. He is running headlong into a brick wall. However, I have more to say, below.

When I was searching for the file, I noticed that someone had pointed to this file on Rossi’s blog. Looking for it, I saw this post, which mentions a conference in China. The post contains a number of false and misleading statements. Rossi lies to his followers — or is insane, actually believes what he is saying. It does not match what are now known and acknowledged facts. I may examine that blog post elsewhere.

This blog post links to Sifferkoll’s blog.  My opinion of Sifferkoll just went up. Others had tracked down when the talk in China may have been given. Sifferkoll still has his theme to pursue (Something Wrong with IH), but at least he corrects some of it:

Update #1: There are indication that this presentation is older than Oct ’15. That makes sense since the COP they are selling are lower than would have been the case half way into the MW test. Actually, if these slides are from late 2013 it could be even more important since it was during shortly after the MW reactor tested in Ferrera (May ’13) was shipped to Raleigh (Aug ’13) and during the time when the one year test should have started, but IH “failed” to find somewhere to put the container!!! Really makes you go hmmm…, about IH failing to do this and at the same time having time for a sales trip to China selling the COP 3-20 reactor …

(There is no indication that IH failed to find somewhere to put the container. Sifferkoll simply believes the Rossi Story. The evidence makes it likely that Rossi was not ready to start in August, 2013, when the “1 MW E-Cat plant” was delivered, hence the Second Amendment to the Agreement, allowing postponement. It wasn’t Darden, probably, and Darden and Vaughn would not be the ones working on the devices. They are business leaders, executives, not engineers.)

LENR Calender, a regular lenr-forum user, May 24, 2016, provides the information and notes that “people” have also looked at the file date (as I did, above.) So Rends’ lenr-forum post, above, from July 20, 2016, was already presenting old idea, already shown to be false. Did anyone tell him? Perhaps not.

This was almost certainly written by Rossi, it echoes his exact earlier language, but I’m just sticking this here as a reminder, it’s not on point here. Likewise this, to which Rossi replied.

I could not find the file reference that led me to look at the Rossi blog. However, there are hints that Rossi believed the reports about the China conference and Darden. My point was that his followers feed him false information, that he then reacts to. Of course, maybe they are not followers, they are just sock puppets.


Author: Abd ulRahman Lomax


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