CHENCO GmbH Announces Initiation of Claims Proceedings Against Do-Fluoride Chemicals (DFD) for Unauthorized Use of Technology, Material Breach of Contract and Violations of Confidentiality Totaling More Than Euro 23 Million

Aug 14, 2011, 20:00 ET from CHENCO GmbH

REGENSBURG, Germany, Aug. 14, 2011 /PRNewswire/ -- CHENCO GmbH announced that they have filed claims of more than EUR 23 Million against Do-Fluoride Chemicals (DFD, 002407.SZ) of Henan, China under ICC arbitration for immediate judgment.

CHENCO claims that DFD, after having licensed and built 3 (three) plants using authorized CHENCO Technology, has built 12 (twelve) additional unauthorized and illegal plants for the production of Anhydrous Hydrogen Fluoride (AHF) and Aluminium Fluoride (AlF3) based upon CHENCO Technology. Additionally, CHENCO claims that DFD together with Chalco (Aluminium Corporation of China) has entered into a joint venture, called Fushun, whereby unauthorized CHENCO Technology is to be used for both. Contrary to the clear obligation of the underlying Agreements DFD has not paid for these additional plants.

The total claims to be made by CHENCO continue to rise, as further evidence is uncovered that additional contractual violations have been committed by DFD.

The claims shall be presented at hearings to be held as ICC Arbitration in Zurich, Switzerland, under Swiss Law as agreed contractually by both CHENCO and DFD.

Dr. Jozsef Juhasz, Managing Director of CHENCO and world-renowned expert in Fluorine-based production technologies and processes, said, "We are very proud that DFD has become successful directly because of CHENCO technology. Every chemical producer wants to claim a unique technology difference, but DFD built their company on CHENCO technology and now they do not acknowledge it. The evidence shows differently and we shall prevail. We are only sorry that DFD is putting its own future at risk. CHENCO understands that DFD needs a large amount of money to complete their plans to become a major lithium battery producer, which is based upon CHENCO Lithium Hexafluorophosphate technology, and we do not wish to make it more difficult for DFD to raise those funds, but we can not allow our intellectual property to be stolen or otherwise illegally used."

DFD has experienced tremendous growth by using CHENCO technology during the years 2005 until 2010; licensing CHENCO Technology for one Aluminium Fluoride plant in 2005, one plant for Anhydrous Hydrogen Fluoride in 2006 and for Lithium Hexafluorophosphate production in 2009.

While CHENCO has always preferred to settle these matters amicably, DFD has refused CHENCO's request to make a reasonable solution offer in out-of-court negotiations and so CHENCO is forced to go into arbitration.

CHENCO GmbH, Chemical Engineering and Consulting designs and constructs chemical, pharmaceutical and industrial recycling plants worldwide. CHENCO, based in Regensburg, Germany, was founded by Dr. Jozsef Juhasz in 1980 to continue the development of world-class fluorine-based chemical production plants. Dr. Juhasz has developed, rebuilt or otherwise significantly upgraded well over 50 plants world wide in his greater than 45 years experience with great success.

SOURCE CHENCO GmbH



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