Honeywell, DuPont Face European Probe | January 2, 2012 Issue - Vol. 90 Issue 1 | Chemical & Engineering News
Volume 90 Issue 1 | p. 8 | News of The Week
Issue Date: January 2, 2012

Honeywell, DuPont Face European Probe

Antitrust: Arkema complaint leads to scrutiny of refrigerants market
Department: Business
Keywords: patents, refrigerants, global warming
Firms have a dispute over rights to produce an environmentally friendly auto air-conditioning gas.
Credit: Shutterstock
Congested traffic on highway with orange sunset.
Firms have a dispute over rights to produce an environmentally friendly auto air-conditioning gas.
Credit: Shutterstock

Under prompting from French specialty chemical maker Arkema, the European Commission (EC), the administrative arm of the 27-nation European Union, has opened an antitrust proceeding to investigate whether an agreement between Honeywell and DuPont to develop and produce a next-generation auto refrigerant is anticompetitive.

The EC’s investigation escalates a dispute between Arkema and the U.S. partners over the patent rights to hydrofluoroolefin (HFO)-1234yf, a refrigerant recently introduced for the air-conditioning systems of cars that will be sold under new European environmental regulations. HFO-1234yf also has applications in fluorochemical markets such as refrigeration, home air-conditioning, and foam blowing. Those markets are worth as much as $5 billion globally in annual sales, according to Ray K. Will, principal consultant with business information publisher IHS Chemical.

An Arkema spokeswoman says that the firm has proprietary technology to make HFO-1234yf but that Honeywell owns application patents in Europe and the U.S. that keep Arkema from those markets. Although Arkema contests the patents, the spokeswoman says the company is also willing “to obtain a license under fair and reasonable conditions in order to supply HFO-1234yf to car makers as soon as possible.”

Both Honeywell and DuPont say they are confident the commission will rule that they have acted in compliance with European competition rules.

The two U.S. firms formed their agreement to jointly produce, but separately market, HFO-1234yf. Because HFO-1234yf has a low global-warming potential and is a drop-in replacement for the widely used refrigerant hydrofluorocarbon (HFC)-134a, it is the auto industry’s refrigerant of choice.

The EC says it will also investigate whether Honeywell “engaged in deceptive conduct” by not disclosing its patent position while HFO-1234yf was being evaluated to replace HFC-134a.

Court battles over the rights to HFO-1234yf have been going on since 2009, when Honeywell first sued Arkema in a European court for infringing its patents. Arkema sued Honeywell in June 2010 in U.S. District Court for the Eastern District of Pennsylvania seeking to invalidate Honeywell’s U.S. patents. Arkema says it has also filed an action in the European Patent Office to invalidate Honeywell’s patents.

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