KIVA and its President and CEO, Igor Khalev, have been sued by Iofina, Inc., Iofina Resources, Inc. and Iofina Chemical, Inc. (the “Iofina Entities”) in the U.S. District Court for the Western District of Oklahoma. In this lawsuit, the Iofina Entities have accused KIVA and Mr. Khalev of misappropriating certain unspecified trade secrets related to an air-blowing iodine-extraction process. KIVA and Mr. Khalev staunchly deny any wrongdoing and intend to vigorously defend against the baseless claims asserted by the Iofina Entities.
Mr. Khalev has worked in the iodine-extraction industry for approximately thirty years and, over that time, he engineered, designed, and put into operation multiple iodine extraction plants throughout the world, amassing a considerable wealth of knowledge regarding various iodine-extraction processes and technologies. In September of 2011, Iofina, Inc. hired Mr. Khalev as its Vice President of Engineering and issued a press release touting his considerable experience in the industry.
When Mr. Khalev assumed his duties as Vice President of Engineering for Iofina, Inc., he discovered that it was attempting to extract iodine from wastewater and brine streams using mobile units based on ion exchange technology, or what Iofina called "PODs," which it marketed under the Wellhead Extraction Technology (“WET”) trademark. On Mr. Khalev’s strong recommendation, Iofina switched its focus from mobile PODs that delivered very poor results, to fixed plants that use the well-known air-blowing or blowout method commonly used in the industry for extracting iodine from oilfield brines and aquifers. During his tenure at Iofina, Inc. Mr. Khalev oversaw this transition, tapping into his many years of experience and vast knowledge of air-blowing methods to extract iodine. He provided engineering and design data for Iofina, Inc.’s first three iodine-extraction plants based on air-blowing technology. The Iofina Entities now market these air-blowing iodine-extraction systems under the IOsorb trademark. Mr. Khalev left Iofina, Inc. in 2013 and formed KIVA later that year.
The air-blowing method of iodine extraction has been used throughout the industry for many decades and is based on technologies that were made publicly available in patents owned by Dow Chemical in the 1930s that expired long ago. By using publicly available methodologies and Mr. Khalev’s decades of experience in iodine extraction, KIVA and Mr. Khalev do not believe that they have misappropriated any of the Iofina Entities’ purported trade secrets.
KIVA believes the Iofina Entities initiated this lawsuit in an effort to eliminate KIVA as a competitor in the extraction and sale of iodine. KIVA is confident that the legal process will vindicate KIVA and Mr. Khalev.