Ineos sues Sinopec for trade secret violations, fears 'major harm' to its acrylonitrile business

By Steve Toloken
News Editor / International

Published: March 21, 2014 12:15 am ET
Updated: March 21, 2014 10:04 am ET

Image By: Ineos Ineos Chairman Jim Ratcliffe

Related to this story

Topics Materials Legal China Materials Suppliers
Companies & Associations

Ineos Group AG is suing Chinese state-owned oil and petrochemical giant Sinopec, accusing the Chinese company of violating Ineos intellectual property and misusing trade secrets to build acrylonitrile factories.

Ineos said in a strongly-worded March 21 statement that it fears “major harm” to its global $3 billion acrylonitrile business, which it said generates $500 million in profit a year for the company and supports 5,000 jobs.

“We have good and valuable relationships with Sinopec and other Chinese companies across our business. But in this case, we have to take action to protect the interests of our stakeholders,” said Ineos Chairman Jim Ratcliffe. “The fundamental value of Ineos depends upon its technology. We have no option but to defend our hard-won intellectual property."

Sinopec has had a license to use Ineos acrylonitrile technology since 1984, according to the Ineos statement.

The Chinese company told the Financial Times newspaper that it has also successfully developed its own acrylonitrile catalyst and related technology at its research labs in Shanghai over the last 50 years and said it had “full proprietary intellectual property rights.”

One chemical industry consultant with experience with both Chinese and Western firms said it can be common for companies like Sinopec to feel they have made improvements in the technology that fall outside the original license. That could be a key issue to be debated in court, the consultant said, speaking anonymously.

In its statement, Rolle, Switzerland-based Ineos, however, said Sinopec’s “Ningbo Engineering Co. has broken a long-established technology agreement which, together with trade secret misuse by other Sinopec companies, has enabled development of a series of new world scale acrylonitrile plants without Ineos agreement or consent.”

Ineos said its acrylonitrile technology provides the basis for over 90 percent of world production for the chemical, which is a building block of ABS plastic and the carbon fiber used to manufacture the new Boeing 787 Dreamliner aircraft.

The Swiss company said “the prolific building of acrylonitrile plants in China will destroy [our] business.”

“We want to take our best technology to China but we need to know that it will be protected,” Ratcliffe said.

The company said it filed suit in the Beijing High Court and is pursuing a parallel arbitration case in Sweden. It said it has “every confidence” in China’s intellectual property system because the country files more patents than any other country.

Ineos, the world’s fourth-largest chemical company, manufactures acrylonitrile at two facilities in the United States and one each in the United Kingdom and Germany.

Ineos may be walking a bit of a fine line commercially with the lawsuit, as the two companies are intertwined in investments and business deals in China.

They broke ground last year on a 50/50 joint venture to build a phenol acetone plant in Nanjing, a $500 million investment that Ineos said is its largest to date in China. As well, Sinopec licenses Ineos technology in polypropylene and high density polyethylene.


Comments

Ineos sues Sinopec for trade secret violations, fears 'major harm' to its acrylonitrile business

By Steve Toloken
News Editor / International

Published: March 21, 2014 12:15 am ET
Updated: March 21, 2014 10:04 am ET

Post Your Comments


Back to story


More stories

Image

Ford moving forward in carbon fiber for 'high volume' use

April 17, 2015 10:21 am ET

Ford Motor Co. has signed a deal with a carbon-fiber manufacturer to jointly explore “high-volume” automotive uses for the lightweight...    More

Image

Force majeure declared at six European sites since mid-March

April 17, 2015 1:10 pm ET

At least six European resin makers have declared force majeure on polyethylene, polypropylene and related products since mid-March, leading to higher ...    More

Image

Executives step down from Star Thermoplastics

April 17, 2015 12:56 pm ET

Executives Randall Fortin and Larry Johnson no longer are with materials firm Star Thermoplastics Alloys & Rubbers Inc.    More

Image

Zoltek expanding CF capacity in Europe

April 17, 2015 10:12 am ET

Leading carbon fiber group Zoltek Corp. has signed a strategic agreement with the Hungarian government to expand its operation in northern Hungary,...    More

Image

Hanwha Azdel adds capacity in Lynchburg

April 16, 2015 2:01 pm ET

Composite maker Hanwha Azdel Inc. will add space and a new production line at its Lynchburg, Va., production facility, the company announced April 16.    More

Market Reports

Plastics Recycling Trends in North America

This report is a review and analysis of the North American Plastics Recycling Industry, including key trends and statistics based on 2013 performance. We examine market environment factors, regulatory issues, industry challenges, key drivers and emerging trends in post-consumer and post-industrial recycling.

Learn more

Injection Molding Market Analysis & Processor Rankings

Plastics News BUNDLED package contains our in-depth Market Analysis of the Injection Molding segment. You will gain keen insight on current trends and our economic outlook.

As a BONUS this includes PN's updated 2014 database of North American Injection Molders RANKED by sales volume. Sort, merge, mail & prospect by end market, materials processed, region, # of plants and more.

Learn more

Plastics Caps & Closures Market Report

The annual recap of top trends and future outlook for the plastics caps & closures market features interviews with industry thought leaders and Bill Wood’s economic forecast of trends in growing end markets. You will also gain insight on trends in caps design, materials, machinery, molds & tooling and reviews of mergers & acquisitions.

Learn more

Upcoming Plastics News Events

June 2, 2015 - June 3, 2015Plastics Financial Summit - Chicago 2015

September 15, 2015 - September 17, 2015Plastics Caps & Closures - September 2015

More Events