Enercon loses patent battle in Chennai Court- finds decison alarming- warns Wind Industry and WTG OEMs

Enercon GmbH, based in Aurich, Northern Germany, is the fourth-largest wind turbine manufacturer in the world and has been the market leader in Germany with over 60% market share.

Enercon set up Enercon India Limited  in 1995 and controlled a 56% stake, while their Indian partner was textile entrepreneur Yogesh Mehra whose Mehra Group controlled 44%.

Mehra was appointed Managing Director/CEO and Chairman of the Supervisory Board and was the and the founding chairman of the Indian producers association for wind turbines.

The difference of opinion began in 2005 when the Indian partners wanted to go public and demanded a more aggressive growth with the German partner wanted slow but sustainable and secure growth.

A legal case brought by Enercon in 2007, accusing its Indian partners of concealing the company’s state of affairs and financial mismanagement, resulted in a court ruling that preserved the Mehra family’s control of EIL.

The Indian partners sued for the release of the German patents who status remained protected around the world. Chennai-based patent litigation firm IPAB declared twelve Enercon patents to be invalid. The judge spoke of a “lack of inventive step” and “lack of novelty” in patent documents.

EIL manufactures and sells the E48 and E53 turbines of 800KW capacity in India.

According to this report in German papers, the accusation of bribery of the court still remains – but no one at Enercon can prove it. Thus, the Germans say that they have no explanation for these judgments. Because of this loss in patent protection, anyone can use this technology from Germany. “Among other things in India that threaten Enercon, nuclear technologies are falling into the hands of competitors (generator, inverter, control unit), ” says Enercon in Aurich. It fears that inferior and dangerous quality products could be sold under the German banner.

“The verdict is an alarming precedent for an OEM, ” says Enercon Counsel Stefan Knottnerus-Meyer. “Not only did EIL produce and install identical wind turbines in India, it also sells them under a brand name hijacked from Enercon.” Finally, the Germans also unmasked an industrial spy in EIL’s service at its plant in Magdeburg. He was convicted, the report in the German paper further adds.

According to the report, the exploitation of Enercon has now become an issue in Berlin (meaning political). The Federal Ministry of Economics speaks of a “severe experience ” for Enercon. The SPD Bundestag member Garrelt Duin made a “small request” on Friday to the Federal Government to find out measures were being taken to protect German companies in India. The other part of the request entailed a disclosure of how high the estimates of annual loss to German companies were, that suffered due to the failure of Patent (Protection) Rights in India and the economic damage thereby.  “We still await this week for the answer, “said Duin. The word in Berlin is that EIL has been named a “gold sponsor “of the Conference for Wind Power India occurring in Chennai in 2011 with Mehra as the highest official of the Union – and that this conference is being sponsored by Berlin’s Environment Ministry.

In another interview to European based Recharge, Enercon has said that it is still interested in an out-of-court settlement to resolve the dispute. But, as it stands, the situation is acting as a brake on its ability to participate in the growing ­Indian market.

Given these developments, it seems like Enercom Gmbh is now trying to use the political influence from Berlin to get the Indian partner to settle out of court.

Readers must note here that Enercon itself has not been free of what it has accused its Indian partner of.

 According to Wikipedia:

Enercon was prohibited from exporting their wind turbines to the US until 2010 ^[3] due to alleged infringement of U.S. Patent 5,083,039^[4]. Recently a cross patent agreement was made with its competitor General Electric. Enercon claims their intellectual property was stolen by Kenetech (US Windpower, Inc.) and patented in the US before they could do so. Kenetech made similar claims against Enercon. However, solid evidence has been presented that shows there was espionage against Enercon. According to the European Parliament; Kenetech seeking evidence for legal action against Enercon for breach of patent rights on the grounds that Enercon had obtained commercial secrets illegally. According to a NSA employee, detailed information concerning Enercon was passed on to Kenetech via ECHELON.^[3][5] According to this report, the aim of the espionage against Enercon was the forwarding of details of Wobbens wind wheel to a US firm. The consequence was that the US firm patents the wind wheel before Wobben, resulting in a breach of patent rights. (see Page 104)