Ineos Takes Legal Action Against Sinopec Over Patent Misuse

Ineos Group AG, the largest chemicals maker in the U.K., is taking legal action against China Petroleum & Chemical Corp. for misuse of trade secrets.

A unit of the state-owned company known as Sinopec has “broken a long-established technology agreement which, together with trade-secret misuse by other Sinopec companies, has enabled development” of acrylonitrile plants in China without Ineos’s consent, the company said today in a statement.

The case is the latest brought against Chinese companies for copyright or patent infringements. American Superconductor Corp., a U.S. supplier of wind-turbine parts, said last month that two cases filed in China will be heard in court. Ineos’s agreement with Sinopec for the licensing of its acrylonitrile technology in China dates back to 1984, its website shows.

“The fundamental value of Ineos depends upon its technology,” Ineos Chairman Jim Ratcliffe said in the statement. “We have no option but to defend our hard-won intellectual property.”

Acrylonitrile is a component in carbon fiber, which is used in cars and aircraft such as the Boeing 787 Dreamliner. It’s also used in plastics for toys and computer monitors.

Sinopec officials in Beijing, Hong Kong and London didn’t respond to repeated calls and e-mails seeking comment.

Ineos is pursuing parallel actions in Beijing and through an arbitrator in Sweden, according to the Rolle, Switzerland-based company. Its other projects with Sinopec include a proposed phenol plant at Nanjing, Jiangsu province, which Ineos expects to go ahead as planned.

“Ineos and Sinopec are major world chemical companies and will continue to seek ways to work together to mutual advantage,” Richard Longden, a spokesman for Ineos, said today in an e-mail.

Ineos also has a joint venture with PetroChina Co. through which it operates its Scottish and French oil refineries.

Before it's here, it's on the Bloomberg Terminal.