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Butamax and Gevo cross-license & settle litigation on bio-isobutanol; Butamax to lead w/ gasoline blending, Gevo w/ alcohol-to-jet

Gevo, Inc. and Butamax Advanced Biofuels, LLC, a joint venture between BP and DuPont, have entered into worldwide patent cross-license and settlement agreements, ending a patent dispute that stretches back to 2011 related to technologies for the production of bio-based isobutanol. (Earlier post.)

This settlement ends all of the lawsuits and creates a new relationship between the companies, aimed at leveraging each other’s strengths and accelerating development of competitive supply for bio-based isobutanol.

The cross-license agreement grants both parties patent licenses to all fields for isobutanol and is structured to develop robust and sustainable isobutanol markets. The license will be royalty-bearing for Butamax in certain fields and royalty-bearing for Gevo in other fields.

There are also a number of fields that are royalty-free for both companies. Both parties can sell up to 30 million gallons per year royalty-free into any field.

  • Butamax will take the lead role in developing the market for isobutanol as an on-road gasoline blendstock. This will include progressing ongoing programs to gain required EPA approvals for mainstream use of 16% isobutanol as a gasoline blend component. Butamax has also conducted joint research with Underwriters Laboratories (UL), which has demonstrated that these blends can be used safely in fuel storage and dispensing equipment meeting current UL standards. It is expected that UL’s guidance will clear the way for state government agencies to consider and approve the dispensing of biobutanol-gasoline fuel blends in the US.

  • Gevo will lead development of the jet fuel market. Gevo has been producing and selling alcohol-to-jet fuel (ATJ) derived from isobutanol since 2011. To date, Gevo’s ATJ has been produced at its demo biorefinery in Silsbee, TX, using isobutanol produced at its Luverne, MN, fermentation facility. The company has successfully flown tests flights with the US Air Force, U.S. Army, and US Navy and now expects to secure the MIL-SPEC certification (JP-8 and JP-5) enabling bids on future RFPs for renewable jet fuel by the Defense Logistics Agency. Gevo also intends to begin test flights with the commercial aviation industry, including Alaska Airlines, following receipt of ASTM International certification, expected before the end of 2015.

While Butamax and Gevo have cross-licensed all of their patents for making and using isobutanol, both parties will have their own biocatalyst and process technologies. Both Butamax and Gevo are free to license their respective technology packages to third parties. A third party licensee would be granted a sub-license, and would be subject to terms and conditions that are consistent with the cross-license between Butamax and Gevo.

Both parties have agreed to keep all details relating to these agreements confidential, other than what is disclosed in this press release and the attachment, or is otherwise required to be disclosed by law.

Comments

SJC

We need patent reform in the U.S. Make patents harder to get, put them in effect for a shorter period, if the assignee or licensee does not take it to market, they lose the patent.

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