Thursday, January 2, 2014

An open letter to Scientific American and MIT Technology Review

You have been gamed.

Here are the players. As a disclaimer, let me say that I am a “short seller” here.  I look for scams and “misrepresentations’, and then bet that increased exposure will eventually lead to a lower price.  In this game there are also the “retail investors” -- those who, for the most part, are betting the price will rise.  They usually do not have time for in-depth research and depend upon analysts and the media for their information. (This is where you guys come in.)  But the average investors are not really on the other side of the table from me; they only think they are.  They are often a resource for stock promoters -- ping pong balls caught between stock promoters and short sellers. 

Someone explain this to me. Here are the two virtually identical titles from your two supposedly different journals.

Scientific American
MIT Technology Review

 The company in question is Clearsign Combustion Corp. The first expression of their technology appears in their 2009 patent application. The original inventors listed are …

Dr. Thomas Hartwick – He recently signed up to validate and interpret a “green” technology for Sustainable Power Corp (SSTP), which ran a technology scam whose CEO was recently convicted in federal court for a pump and dump scheme. (Evidence)

David Goodson is said to have collaborated with Nobel Prize winners, Crick and Watson, under circumstances so extremely unlikely that it is safe to say that someone has lied. Patents claimed for him in SEC filings were faked.  The commercialization of various technologies were claimed – while in reality they failed and investors were burned. (Evidence)

Richard Rutkowski is the CEO. He has a history of financial management and stock promotion -- “investor relations” -- not combustion technology – and yet here he is as one of the “inventors” of Clearsign’s technology.  Rutkowski independently partnered with -- and Clearsign also hired -- an Investor Relations rep named John C. McFarland, who has been permanently barred from the securities industry.  (Evidence for Rutkowski, McFarland, and Osler)

Geoffrey Osler is the Chief Marketing Officer. He also has a history with financial management and stock promotion and has partnered in the past with Rutkowski.

Chris Wiklof is a patent agent for Clearsign and has also been associated with Intellectual Ventures, often referred to as a “patent troll.” Intellectual Ventures is currently in the crosshairs of President Obama’s executive orders: are these companies protecting real inventors or just putting together patent portfolios for legal “shake downs”? (Wiklofwith Intellectual Ventures  and Intellectual Ventures itself)

CNN reports:

“The Obama administration wants to crack down on abusive court cases brought patent trolls, such as Intellectual Ventures.” …. “They don't actually produce anything themselves," Obama said. "They're just trying to essentially leverage and hijack somebody else's idea and see if they can extort some money out of them."
“Intellectual Ventures is a notorious example of a "patent troll" company. The research firm, based around the corner from Microsoft's headquarters in the Seattle area, acquires thousands of patents and has a research lab to develop its own. Yet it has no products to speak of. The company engages in constant patent litigation, and many tech companies have accused Intellectual Ventures of stifling innovation." ‘ ~ CNN Money 
I spent six months researching and preparing material for the SEC whistleblower program. I also published the above information online – most of it was published in 2012.

The 2012 essay, “A Serious Problem With ClearSign's Story,” sums up the critical failure here. I could have titled it, “The case of the missing inventors.” In a nutshell, Clearsign declared its technology in its 2009 patent application.  The 5 “inventors” have all been discredited. You can’t have a real invention without an inventor, but if one skips over the history and surrenders all questions, one can be made to believe the newest story.  It’s patent application has received a non-final rejection from the patent office.  The USPTO has said that the technology has largely been anticipated by others – but more of this later.

Originally, David Goodson had been singled out as the original inventor of Clearsign’s technology.  That didn’t work out too well, as you can see from my reports.  So perhaps we can understand why Clearsign no longer mentions the original inventor of the “revolutionary technology” … but it is difficult to understand how Scientific American and MIT Technology Review can write about Clearsign’s technology-- and yet not a word about the man who not too long ago was supposed to be the “original inventor” behind Clearsign: David Goodson. Dr. Thomas Hartwick was the top listed inventor on Clearsign’s first declaration of its technology: the 2009 patent application at the USPTO.  Why was there not a word about Clearsign’s original inventors?

Needless to say, Scientific American has scored a big one for stock promoters. On the official website, Clearsign Combustion now has the following text and link: “Clearsign Combustion featured in Scientific American.”  How can this be?  The answer might be found in other highly improbable coincidences: it appears as if the articles were cut-and-paste PR material from Clearsign itself.  Here’s what I mean:

Scientific American
Much of the air pollution produced by today’s fossil-fuel power plants is the result of imperfect combustion. Hot spots in a flame increase the reactions between fuel and air molecules and lead to formation of common air pollutants like nitrogen oxides (or NOx, a precursor to smog), carbon monoxide (CO) and particulate matter.
MIT Technology Review
Much of the pollution from a power plant is the result of problems with combustion. If parts of a flame get too hot, it can lead to the formation of nitrogen oxides, which contribute to smog. Similarly, incomplete burning, which can result from the poor mixing of fuel and air, can form soot.

It is unclear to me whether or not Scientific American borrowed from the earlier MIT Technology Review, or whether both borrowed from some other text (like a company press release, presentation, or a rote telephone pitch).  It is highly improbable however that both reporters independently researched the company and independently came up with the same title and much of the same message.

On the other hand, it is highly probable that the reporters were just saving time by working with management-prepared material.  The “articles” read like promotional material designed by and for Clearsign, and not at all like independent research focused on the underlying technology and the original innovators.  It very much appears that Clearsign – the company -- has been validated, since Scientific American is a prestigious institution and has amassed a degree of credibility (at least among the general public). 

Investors have just jumped onto what looks very much like a coordinated promotional effort to pump up the stock price. See, Clearsign has recently been set up to offer pieces of itself to the public for as much as $30 million dollars. The stock price has just soared about 100% in the last few weeks.  How convenient. Had the writers done fifteen minutes of research into this technology and its 200 year history they would have easily found the true deserving inventors and scientists -- who have now been effectively neglected and ignored.  It would not have been difficult to locate them.  Currently, Clearsign has no patents, but of the three applications mentioned in Clearsign’s last SEC annual filing, two have received non-final rejections from the US Patent Office, saying that the technology has been largely anticipated by others. The status of these applications is now hanging in the balance.  (The third application has not yet received judgment.)

Link to, input the following application numbers from Clearsign, and click on the tab “Image File Wrapper.”  We can read the reasons for the USPTO rejections and the dialogue currently taking place. From Clearsign’s last annual report with the SEC ….

System and Apparatus for Applying an Electric Field to a Combustion Volume
ClearSign Combustion Corporation
Method and Apparatus for Electrical Control of Heat Transfer
ClearSign Combustion Corporation
Electric Field Control of Two or More Responses in a Combustion System
ClearSign Combustion Corporation

 Looking into the reasons for these rejections we see a larger history of innovation and the major innovators preceding Clearsign’s claims. It is easy to peruse these rejections and look up some of these patents:

2005 Michael Jayne: US2005/0208446

“An apparatus and method for the creation, placement and control of an area of electrical ionization within an internal combustion engine combustion chamber or a fuel burner for a furnace is disclosed.”

1964 Leo Ongkiehong, et al: 1964 US 3129062

“The system of claim 2 in which the detector consists of three cylindrical electrodes arranged concentrically around a burner, said burner being arranged to burn the gas discharged from a chromatograph, said burner in addition forming the fourth electrode.”

2007 David Branston, et al: US 2007/0020567

“An electrical device is used for guiding and/or altering a flame. The flame is subjected to the action of an electric field.”

2009 Abdelkrim Younsi, et al: US 2009/0064661; 8082725

“The mixing zone, the combustion zone, and/or the outlet comprises an electro-dynamic swirler configured to swirl ionized gas. The electro-dynamic swirler comprises a plurality of electrodes in electrical communication with a power source.”

2005 Rolf Heiligers, et al: US 2005/0208442

“The invention relates to a fuel combustion device (1) for the combustion of fuels in an exothermic chemical reaction, comprising a device (2) for supplying the fuels, a combustion chamber for combustion of the supplied fuels in a flame (10) and at least two electrodes (5, 9) through which an electrical field (E) is applied to the flame (10) with the purpose of producing a reaction plasma in said flame (10), wherein the reaction plasma produced has a high degree of ionization.”

The DC electric field effect on the nonpremixed swirling flame dynamics, flame temperature and composition profiles is studied experimentally with the aim of establishing the feasibility of electric control of swirling combustion and formation of polluting emissions.”

1999 William Bassett, et al: 5971745

An apparatus and process for controlling the operation of a gas burner, by monitoring and controlling the stoichiometry of the air and fuel gas during the burning process.”

Other inventions in this field, patented, but not mentioned in the rejection are those by William and Frank Kaehni – 1952 -- (2604936) and Franklin Wright – 1968  (3416870). The basic knowledge behind this technology, as mentioned earlier, is two hundred years old – 1814 -- “TheBakerian Lecture: On some new electro- Chemical Phenomena,” William Brande. 

At this point we have to ask Scientific American and MIT Technology Review: why wasn’t David Branston mentioned in your articles?  Upon what basis can we believe that you were more concerned with the technology itself than with presenting rote PR material from Clearsign?  There is little excuse for not knowing who Branston is, or what his contribution was, since a simple patent search on Google would have turned him up. (All of this presumes of course that one’s aim is to research the technology itself and not merely take the company’s own guided tour.) Branston was even featured in my first report, exposing Clearsign’s misrepresentations and published online over a year ago – a report syndicated through online news feeds such as Yahoo!’s and Google’s. (“Clearsign: The Reinvention of Fire or …?”) A responsible Google search would have turned this up.

This is hard to grasp.  As we can see in the rejection documents, Branston, Jayne, Younsi and others have real patents – which largely anticipate Clearsign’s patent applications.  Clearsign, at this point, has no patents. Two of the three applications claimed in its last annual filing have received non-final rejections. So we have to ask Scientific American and MIT Technology Review:

What unique technology has Clearsign Combustion presented to third-party review that others have not already claimed as their own intellectual property?  None?  Then how do these articles qualify as science and not as company promotion?

As Clearsign disclosed in their prospectus,

"Our technology has not been tested or verified by any independent third party."

Why present Clearsign – the company – and not material that has undergone the discipline of peer-review?  Such discipline would have precluded mention of Clearsign.  Why not present the accomplished and deserving innovators behind this fascinating technology?  Why was Clearsign singled out as if it just popped into existence as a “revolutionary” technology – without a history?  Where is the technology unique to Clearsign which has been verified by a third party?  I believe that the answer lies with Clearsign’s having a promotional team so effective it has gamed, not just the stock market, but the network of science and technology journals as well.  Evidently, either a good PR team behind a publicly traded stock has more influence than the research performed by a scientific journal … or responsible, independent research was not performed here.  That is to say, Scientific American and MIT Technology Review have been gamed by a PR team with superior talents. 

What is the scientific method? That, you already know. What’s a technology scam?  Perhaps we should go into this briefly.  It’s not phony technology, as one would think. It’s usually real technology presented in a way that leads investors to believe that they can get outrageously rich.  It misrepresents the commercial prospects of the device, the true ownership, or the competition. It takes advantage of the population’s general ignorance of the history and science involved.  It then gains credibility by forging mental associations within investors … by simply getting close to credible people, institutions, and periodicals … etc. This is the “game” I am talking about.  So the influence of electrical fields on flames is real. It does prevent pollutants from forming. It does shape flames. The question is, Who owns the fundamental technology? Who really developed it? Who really deserves the credit?  David Goodson? Thomas Hartwick? No – that was the old 2009 story. It’s now 2014 and Clearsign has assembled a new, more credible team.  They only need to be presented front and center in PR material. No one will look below the surface. No one will care that there are no credible inventors to account for Clearsign’s original 2009 declaration of its technology. No one will care that Clearsign has already suffered a critical failure in their technology story. Click on the preceding link.  If you read the essay you will see how Clearsign's present claims exist downstream from serious misrepresentations, leaving the present story implausible.

If a science or technology journal merely takes the PR material without independent examination, Clearsign can emerge as the “leader” of this technology – without having demonstrated its “revolutionary” technology to a responsible third party!  So Clearsign, the company, appears to have been validated by Scientific American and MIT Technology Review. Its attempt to skip over its original inventors, recruit new engineers and professors, and get investors focused on this new team has received an unwitting “assist.” This is where you guys came in.

Let me try to take up a defense for Scientific American: perhaps the writer in question is really “just” a blogger in your network.  But that is certainly not how it appears to a reader.  Here is the article as it appears in the Yahoo! News feed . 
Note that an official looking “Scientific American” logo accompanies the title and article -- without sufficient qualification or disclaimer.  It certaintly appears that Clearsign is “featured in” Scientific American and that Scientific American has performed some sort of due diligence here.  (But then, I shouldn’t presume.  Let’s just ask: Has Clearsign received any sort of thumbs up from Scientific American?   Could you guys “add some color” to this?  Do you stand behind this reporting?  Can you even tell the reader what unique and revolutionary technology Clearsign has that can be publicly verified? None? Then what is the basis for the article?)

The standard procedure for sketchy situations would be to say that the company’s technology is top secret and they don’t want to give an edge to their competitors. That’s why they don’t reveal the technology to a third party, they say.  But this is an angle for business to take, not science.   In a remotely related case, SSTP claimed a “top secret” catalyst for its energy scam; the federal government showed that it was flushed out in the initial operation of the machine inspected and could not have even been used in the process.  The same scientist who “interepreted” the data for SSTP investors is the very same Dr. Hartwick who appears on Clearsign’s patent applications. So any “top secret” technology here must be regarded with some serious skepticism.  I presented a slideshow of evidence, which I also submitted to the SEC whistleblower program.

As an aside, I believe that Clearsign will eventually succeed in developing a patent portfolio, after all CEO Rutkowski’s old acquaintance, Mr. Wiklof, is astute at this business, and has experience with Intellectual Ventures – a “patent troll.”  Clearsign has another member on its team who also has ties with Intellectual Ventures, Ms. Swapna Hiray.  So after the back and forth, Clearsign will certainly end up with some patents. They have added many more applications over this last year.  But the question is, after Clearsign is forced by prior patents and established technology to water down their claims, how much real market power will exist?

It had been suggested to me that the intention behind Clearsign and the deeply involved MDB Capital Group LLC was to create a “patent troll.”   The more I researched the company the more I began to agree with this, while simultaneously coming to the conclusion that the prospects are dwindling for the patent troll business model, given the recent shift in the legal system – namely, losers may now have to pay the other’s attorney fees.  This will be a game changer for patent trolls.  Also given President Obama’s executive orders, part of which involves increased scrutiny at the US Patent Office, it is unclear to me how this is affecting/will affect the prosecution of Clearsign’s patent applications, two of which were rejected shortly after this order.

“The [Obama] administration also told the patent office to tighten scrutiny of overly broad patent claims and said it would aim to curb patent-infringement lawsuits against consumers and small-business owners who are simply using off-the-shelf technology.” ~ New York Times (See news on President Obama’s Executive orders:)

Let’s get back to the players in this game.  In the stock market we are motivated by money; in science, by prestige, a place in history perhaps … or even a genuine concern for nature or health (we hold out such hope for human nature) … but sometimes it’s still just money again.  Journals and the media also have financial motives, usually linked to increasing readership.  It is easy in this game to be confused about what is right and what is wrong. Many investors even believe that “motives” change a forensic conclusion, as if being paid to say that 2 + 2 = 4 would somehow lend credibility to the alternative answer “5” when spoken by someone without financial reward.  With the crowd it’s all up in the air, and that’s why we need science.    At some point we need to look for the reality underlying the claim and assign a value to the most accurate expression of that reality. That demand shouldn’t be too far off from the aim of science: to sift through the myriad incentives that bias our views and formulate an accurate view of our reality.  I encourage Scientific American and MIT technology Review to look beyond all of the motives in this situation and investigate Clearsign within the scientific discipline. Should we take Clearsign’s original inventors’ word for it? David Goodson and Dr. Thomas Hartwick?  Why should we skip over the first story, and not let those misrepresentations by Clearsign to at least raise a few questions for the newest story?

What verified and “revolutionary” technology has Clearsign subjected to peer review?

Upon what scientific basis is there a story here that involves Clearsign, the company?  

But the problem here isn’t just about accuracy, nor is it about doing even the most minimal research; it is also about giving credit where credit is due … especially when it comes to scientists and their technology.

Who deserves the credit for the technological breakthroughs in this space?

See the problem in greater detail here: Clearsign's Lies, Omissions, And One 'Bad Actor'

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