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GreenShift Files Infringement Action against FlottwegLast update: 10/15/2010 1:03:00 PMUse of "Corn Oil Tricanter System" Constitutes Infringement of GreenShift's Patents NEW YORK, Oct 15, 2010 (BUSINESS WIRE) -- GreenShift Corporation (GERS) today announced that its wholly-owned subsidiary, GS CleanTech Corporation ("GreenShift"), has commenced legal action in the United States District Court, District of Connecticut, against Flottweg AG and Flottweg Separation Technologies, Inc. (collectively, "Flottweg") for inducing infringement of GreenShift's U.S. patent covering corn oil extraction technology. GreenShift's complaint (the "Complaint") alleges that Flottweg is infringing GreenShift's U.S. Patent No. 7,601,858, entitled "Method of Processing Ethanol Byproducts and Related Subsystems" (the "'858 Patent"), which covers processes for recovering corn oil from stillage, a precursor to the distillers grain co-product of corn ethanol production. As alleged in the Complaint, Flottweg actively induces third party ethanol manufacturers to directly infringe one or more claims of the '858 Patent by, at a minimum, supplying its horizontal three phase decanters, known as Tricanters, to ethanol manufacturers and instructing the ethanol manufacturers how to use the Tricanters to extract corn oil from stillage in a manner that infringes the '858 Patent. GreenShift Patents Cover Process, Not Equipment On November 27, 2006, almost two years after the filing of GreenShift's '858 Patent, Flottweg and its former CEO filed for a U.S. patent entitled "Method of and Device For Increasing the Yield of Oil Production In a Process of Producing Bio-Ethanol" bearing serial number 11/604,435 (the "Flottweg Application"). In its 2006 application and during the continued prosecution of the Flottweg Application at the U.S. Patent and Trademark Office (the "PTO"), Flottweg has attempted to claim that it invented a process to extract corn oil from ethanol stillage based on the use of Flottweg's Tricanter centrifuge. The PTO has rejected the pending claims in the Flottweg Application on the basis that GreenShift's pre-existing patent application directed to its corn oil extraction process, in combination with other prior art, renders Flottweg's claims obvious. In an office action rejecting all of Flottweg's pending claims, the PTO underscored the distinction between GreenShift's corn oil extraction process itself and the equipment used in GreenShift's corn oil extraction process, and the PTO stated the following in connection with the cited pre-existing GreenShift patent application: "The means or device for recovering oil [taught by GreenShift in its patent application] ... may comprise any suitable device for separating oil from a mixture, such as a gravity separator (which advantageously requires no additional energy input to effect separation and, thus, further enhances efficiency), a centrifuge, a disk-stack centrifuge, a centrifugal decanter, or an evaporator. ... Moreover, in addition to a self-cleaning bowl type centrifuge as the means for recovering oil from the thin stillage, a nozzle bowl disk stack centrifuge would work, as could a horizontal centrifugal three phase decanter." "Any claim that use of Flottweg's horizontal decanters or ICM's repackaged 'corn oil Tricanter system' will avoid liability for infringing our patents is false," said Kevin Kreisler, GreenShift's Chief Executive Officer. "Flottweg and any other equipment suppliers, service providers or other parties that knowingly subsidize, contribute to or induce infringement of our patents will be held accountable." Hindsight is 20/20, and Completely Irrelevant David Winsness, GreenShift's Chief Technology Officer, added: "ICM and others have stated their view that our corn oil extraction patents were issued in error and should be declared invalid as obvious and unpatentable. It is significant that Flottweg's Application and correspondence with the PTO demonstrates that Flottweg and its former CEO clearly disagree with ICM's view and believe instead that corn oil extraction from stillage is a novel and patentable process." Kreisler continued: "ICM designed and/or built about 105 ethanol facilities, each without the ability to extract corn oil from stillage at start-up. The entire industry produced ethanol at reduced efficiency and sacrificed billions in lost profits by not recovering the 40 billion pounds of corn oil that passed through the fleet without extraction between 1980 and 2004, the year our patents were filed. There is a common sense reason for Flottweg's November 2006 'awakening' and the total absence of backend corn oil production prior to 2004: extracting corn oil from stillage was not obvious to those skilled in the art at the time of filing of our patent application in 2004." "Thousands of skilled engineers, operators, plant managers, and owners designed, built and operated billions of gallons of ethanol production facilities without backend corn oil extraction for decades before GreenShift showed up. The fundamental process steps we developed to extract corn oil from stillage may be clear to many in hindsight, but any argument that our patents should be declared invalid because corn oil extraction is obvious today is a distortion of the law and can only fail." About GreenShift Corporation GreenShift Corporation (GERS) develops and commercializes clean technologies designed to address the financial and environmental needs of its clients by decreasing raw material needs, facilitating co-product reuse, and reducing the generation of wastes and emissions. Additional information on GreenShift and its technologies is available online at . GreenShift's technical services staff are available at 888-ETHANOIL or sales@greenshift.com to respond to quotation requests and to answer any questions about GreenShift's corn oil extraction and other technologies. Safe Harbor Statement This press release contains statements that may constitute "forward-looking statements" within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, as amended by the Private Securities Litigation Reform Act of 1995. Those statements include statements regarding the intent, belief or current expectations of GreenShift Corporation and members of its management as well as the assumptions on which such statements are based. Prospective investors are cautioned that any such forward-looking statements are not guarantees of future performance and involve risks and uncertainties, and that actual results may differ materially from those contemplated by such forward-looking statements. Important factors currently known to management that could cause actual results to differ materially from those in forward-statements include fluctuation of operating results, the ability to compete successfully, and the ability to complete before-mentioned transactions. The company undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results. SOURCE: GreenShift Corporation GreenShift Corporation Kevin Kreisler, 212-994-5374 Fax: 646-572-6336 investorrelations@greenshift.com Copyright Business Wire 2010
