EuroGas Intends to Raise Alleged Attempted Patent Fraud in Arbitration

EuroGas wants to raise attempted patent fraud in arbitration (photo by TASR)

Bratislava, May 26 (TASR) – EuroGas, which is in arbitration proceedings with Slovakia concerning the allegedly illegal withdrawal of a licence for talc mining in Gemerska Poloma (Kosice region), claims that it faced attempted patent fraud, EuroGas managing board chairman Wolfgang Rauball told TASR on Friday.

EuroGas’s subsidiary Rozmin filed an application with the Industrial Property Authority (UPV) in 2014 aimed at erasing a utility model called ‘Safety Clog Up of Exhausted Mining Rooms’, which was registered by Central Mining Office (HBU) chair Peter Kukelcik along with Peter Corej. “We filed this application, as the patent was granted based on documents that were stolen from Rozmin,” stressed Rauball.

UPV confirmed that it complied with the erasure application in 2015. “According to the plaintiff, the subject of the contested utility model wasn’t entitled for protection according to the law on utility models. Based on the submitted materials, the utility model in question was erased according to a UPV decision from September 21, 2015, as it failed to meet the condition of being an invention activity at the time at which it was recorded,” UPV wrote in its stance for TASR.

According to UPV, the creators of the utility model appealed against the decision, but the office rejected the appeal. Rauball claims that another attempt to reverse UPV’s verdict came via a company called Upadnica, which acted as the legal successor of Rozmin, which was undergoing bankruptcy proceedings. Upadnica filed an application claiming that it isn’t interested in continuing the proceedings in question.

“Upadnica is a fraudulent company founded by Schmid Industrie Holding (SIH), the owner of the talc mining licence after EuroGas. Its aim was to engage in money laundering and to legalise the sending of payments to HBU representatives for their involvement in revoking the talc mining licence. Moreover, the Slovak prosecutor’s office and police are investigating HBU in connection with various criminal cases. EuroGas will submit to the Paris arbitration evidence of further illegal activities carried out by SIH in Cyprus and Malta,” said Rauball.

UPV also rejected the latter application, as based on the contract on selling the company, the seller doesn’t lose its legal identity and the buyer doesn’t become the universal legal successor of the seller or of the plaintiff in proceedings relating to a proposal concerning erasure of the utility model in question. “The plaintiff in the proceedings concerning the proposal for erasure is Rozmin, which was the sole entity authorised to withdraw the erasure proposal. It insisted on the proposal, however. Upadnica, therefore, wasn’t entitled to ask for a halt to the procedure,” added UPV in its stance.

Robert Schmid, owner of SIH, which in turn owns Upadnica, rejected Rauball’s accusations. “Mr. Rauball likes to attack everyone, including me, the Slovak Republic, the mining authorities. I find all this to be constructions fabricated by him, and I don’t want to comment on them,” Schmid told TASR in reaction.

Rauball, on behalf of EuroGas, prompted the launch of arbitration proceedings against Slovakia at the International Centre for Settlement of Investment Disputes (ICSID) due to the revocation of the talc mining licence. As the petitioner in the arbitration, which was launched in 2014, EuroGas is demanding compensation of $3.2 billion (€2.9 billion) from Slovakia for what it calls a marred investment. It’s expected that a verdict on the arbitration process could be released in 2017. No appeal against ICSID decisions is possible, although they can be overturned due to serious procedural flaws. The arbitration tribunal is expected to issue a definitive ruling in 2018.

EuroGas began indicating its plans to take legal action against Slovakia over the loss of the talc quarry in 2010. At first, it demanded compensation of €500 million in 2011. One year later a company called EuroGas Inc., registered in the USA, also began claiming compensation. EuroGas asserted that its rights related to a trade agreement between the erstwhile Czechoslovakia and the USA from 1991 had been violated. The Slovak Finance Ministry has denied that any such agreement was broken.