Australia’s Fortescue (ASX: FMG) has agreed to settle its high-stakes lawsuit accusing former executives of stealing company data to build their green iron start-up Element Zero.
The iron ore miner had claimed that former chief scientist Bart Kolodziejczyk and former technology development lead Bjorn Winther-Jensen used green iron technology they helped develop while at Fortescue to form Element Zero. CEO Michael Masterman, also a former Fortescue employee, was named in the case, too.
“We are delighted to put this episode behind us,” Masterman said in a statement. “We can now focus all of our deep and capable technical resources on rapidly advancing our iron-ore-to-iron technology and developing our manufacturing sites in the Pilbara heartland of Port Hedland and in the U.S.”
Element Zero said each side would cover its own expenses in a case that saw warrants to raid houses and seize nine million documents while Fortescue used private eyes to rifle through mail and spy on families and children. The miner hit a setback last month when Federal Court Justice Brigitte Markovic rejected its push to access all of Element Zero’s work, a step the miner’s counsel had argued in September was needed to run the case.
Costs
The start-up’s $10 million in funding has been heavily depleted by its legal defence, leaving the start-up in need of far more capital to prove commercial viability and build its planned manufacturing sites. The outcome raises the question of whether Fortescue would have been better off taking a stake in the venture instead of dragging its former executives through court.
The miner’s lawyers argued Element Zero’s work was tied to Fortescue’s broader push for hydrogen-based solutions in its pursuit of what it called the green ore holy grail.
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