THE ENVIA SYSTEMS MELTDOWN: WHAT ARE THE PR IMPLICATIONS?

crisis

Battery startup Envia Systems, a former client of ours, is back in the news.  Unfortunately, it’s not the glowing media coverage we helped the company generate when it announced “Envia Systems Achieves World Record Energy Density for Lithium-Ion Batteries.”

In case you’re not up to speed on the Envia saga, the company is facing a lawsuit from three former executives.  They allege Sujeet Kumar, Envia’s co-founder and CTO, stole intellectual property from NanoeXa, his former employer.  Kumar and Envia deny any wrongdoing.

According to a story filed in the San Jose Mercury News , the lawsuit “alleges that Kumar, before leaving NanoeXa in 2007, downloaded gigabytes of files that contained chemical formulas cell designs, business plans and test results and used the information to form Envia.”

The article goes on to report that the complaint alleges “Kumar used the stolen data to form Envia and falsely represented to the public that he personally had independently developed and produced Envia’s revolutionary technology.”

Irrespective of whether the lawsuit has merit or not, the sudden shift of fate for Envia raises some very interesting questions for PR practitioners.  Chief among them are, “What responsibility does a PR agency have in vetting the claims of its clients?  Does an agency have an obligation to verify whether a client’s technical innovation is viable?”

We’ll take our answer “off the air” and welcome any and all thoughts.

Back in February of 2012, Gallagher PR orchestrated one of the most successful PR announcements in the history of the agency when it helped Envia Systems communicate what we were led to believe was an industry-altering breakthrough in lithium-ion cell technology.  In a nutshell, the announcement that triggered a firestorm of coverage from the likes of The New York Times, Wall St. Journal, Forbes, c/net, San Jose Mercury News, Wired, Scientific American, Motor Trend – not to mention a ton of broadcast media – went as follows:  “the company’s next-generation rechargeable battery has achieved the highest recorded energy density of 400 Watt-hours/kilogram (Wh/kg) for a rechargeable lithium-ion cell.”

After basking in the glow of media accolades, Envia Systems now finds itself facing headlines like “Envia’s High-Energy Battery Cell Mired In Dispute, GM Cancels Deal”; “The Sad Story of the Battery Breakthrough that Proved Too Good to be True”; “Lawsuit alleges that battery startup Envia Systems was founded using stolen intellectual property; Envia denies it”.

So what’s the take away here?  From our perspective, Envia’s perceived “reputation” free-fall will become part of our playbook when querying clients about claims of innovation.  Clearly, the need to thoroughly vet declarations of “breakthroughs” will be put to the test in future engagements.  It’s not only in our clients’ best interests, it’s in ours as well since credibility with industry influencers is our most important capital.

Is this a case of “the more compelling the claim, the bigger the fall”?  You be the judge.

Share Button
MEDIA COVERAGE
THAT MOVES MARKETS
e2e Materials CEO Pat Govang Speaks at the White House Business Council LSI CEO Abhi Talwalkar and Mad Money's Jim Cramer Discuss the 'Data Deluge' Envia Claims Breakthrough’ in Lithium-Ion Battery Cost and Energy Density ABC 7 KGO-TV  Cogswell College prepping new generation of animators Video Interview: Mike Hart of Sierra Energy talks about zero waste Envia Systems featured in BBC's 'Can brine power electric cars of the future?' E2e Materials CEO Patrick Govang, a green-tech innovator, shares his disruptive model Envia Systems' EV battery announcement on NBC-11 (KNTV) with Scott Budman, March 1, 2012 Energate CEO Niraj Bhargava discusses Getting on the Smart Grid on the Business News Network LSI Corp. CEO Abhi Talwalkar on why Flash storage technology is paving the way to future growth SAGE's Smart Green Glass is Showcased at California College EnOcean Self-Powering, Wireless Energy Sensors Join the Internet Portable Power at the Heart of Defibrillators Energate Launches Broadband Smart-Grid-to-Home Connection