Halliburton Co. (NYSE: HAL) will have to meet for arbitration in Miami to address allegations the company violated a nondisclosure agreement with Ecosphere Technologies Inc., a Florida water engineering and technology licensing company.
Ecosphere filed a demand for arbitration in February, alleging Halliburton had stolen, converted or misappropriated its trade secrets, related to Ecosphere’s treatment and recycling of water used during the hydraulic fracturing process.
In a demand filed in February with theAmerican Arbitration Association, Ecosphere asked for $300 million in damages. Halliburton responded, seeking to move the arbitration process to Houston, where the company has its headquarters.
In January 2009, the two companies entered into a joint confidentiality agreement that prevented Halliburton from disclosing Ecosphere’s proprietary information. Halliburton offered to purchase Ecosphere, but negotiations broke down, according to a statement from Leopold Law, the Florida law firm representing Ecosphere.
“Ecosphere alleges Halliburton wrongfully used Ecosphere’s trade secrets to immediately market itself as an environmentally friendly company, form a venture known as Blu Energy Solutions to ‘provide well-site recycling technologies and holistic water management solutions to the oil and gas industry with the goal of reducing disposal costs and minimizing waste volumes’ and acquire trademarks and patents,” according to the statement.
A spokeswoman for Halliburton said the allegations are unfounded and without merit.
“We will vigorously defend our interests in the appropriate forum,” Susie McMichael said in an email.
Both companies have until April 8 to agree on three arbitrators or the arbitrators will be appointed.