A leading research scientist is calling for a full investigation into the Scottish Government’s approach to funding research and development projects after a commercialisation partner it recommended failed to get his invention to market.
Dr Sandy Spowart, founder of Blairgowrie-based SES Technology, has chosen to go public in a long-running dispute between himself and Hillington-based Caledonian Industries, claiming the issues have been “swept under the carpet” by the public authorities.
He claims it is “beyond belief” that Caledonian is about to receive a research grant of more than £500,000 for a new unrelated project in spite of his complaints about the company’s activities to First Minister Alex Salmond, Finance Secretary John Swinney and Robert Black, head of Audit Scotland.
Dr Spowart said: “It has already received millions of pounds of R&D grants … I would question whether this investment has generated a return for the taxpaper.”
Dr Spowart says Caledonian Industries lacked technical expertise to develop his invention. It also emerged that managing director and owner Alan Thornton’s claims of having an MBA from the University of Strathclyde were incorrect. Mr Thornton attributed this to a mistake by a company official.
Caledonian, in turn, claims it is a perfectly suitable Scottish Government research partner and that Dr Spowart’s invention was thwarted by the more cautious investment market created by the credit crunch. Mr Thornton claims the scientist had become an “absolute pest” and they had parted company because he “became very difficult to deal with”.
Dr Spowart, the former head of physics at Dublin City University and former secretary to Dr George Kinchin, former chief scientist of the UK Atomic Energy Authority, fell out with Caledonian after a project to develop a device he had invented – which uses ultraviolet light to sterilise air and water – failed to progress. Potential commercial applications for the product include the purification of air-conditioning units, a large global market.
Dr Spowart had developed the technology with input from Dundee and Loughborough universities and Oxford-based specialist software group Vector Fields. He believes the product was a “once-in-a-generation” breakthrough because it uses one quarter of the energy of existing equivalent products made by the likes of Philips and Siemens.
Scottish Government steered Spowart into Caledonian JV
The technology required prototyping and marketing and, after securing a £160,000 grant from R&D funding quango Scottish Innovation Grants (SIG), now part of Scottish Enterprise, Dr Spowart was steered towards Caledonian Industries by Scottish Government civil servants.
On its recommendation he formed a 75/25 joint venture with Caledonian Ferguson Timpson in 2004 to develop the product, in which his was the minority stake.
Yet, a few weeks after the deal, he said he found the company “lacked in-house technical expertise”, and had no staff with what he considered to be the appropriate scientific qualifications to handle the project.
Meanwhile, in Mr Thornton’s CV it was claimed that he had an MBA from the University of Strathclyde, but the university had no record of him receiving this qualification and he has since confirmed to the Sunday Herald this was a mistake made by a company official.
Relations deteriorated as Dr Spowart’s suspicions grew that Caledonian was not making enough efforts to progress the project, a claim the company strenuously denies.
A prototype was completed in 2006, but at Dr Spowart’s laboratory. Dr Spowart also claims patents were only filed after he spent months exerting pressure on company officials, in response to which Mr Thornton said he “can’t remember” if this was the case.
These applications were then abandoned into the public domain by Caledonian in November 2008 once grant monies ran out and, according to Mr Thornton, “Dr Spowart became very difficult to deal with, so we parted company”.
Dr Spowart said: “Caledonian should have done what it was there to do: fund the patents and sell on the technology to companies capable of manufacturing and marketing it.”
Dr Spowart is separately questioning SIG’s decision to continue funding Caledonian’s project to develop specialist arc lamps, using intellectual property that he believes is his. Caledonian’s solicitors, Maclay Murray & Spens, said the arc lamp intellectual property now belongs to their client.
On the wider failure to get the product to market, Dr Spowart said he has received legal advice that he has an actionable claim against Caledonian on the grounds of “destruction of minority shareholder value”, but he has insufficient funds to raise an action.
Spowart wants probe of the Scottish Government’s approach to R&D
Having failed to win any backing from senior ministers or Audit Scotland since 2008, he is calling for an investigation into what he claims are “wider flaws” in the Scottish Government’s approach to R&D and the commercialisation of science.
He believes the system is open to abuse since it neither requires the funding recipients to have the relevant technical or scientific skills nor, in his view, adequately monitors them since the civil servants doing the monitoring are also largely unqualified.
Mr Thornton said: “Technically we managed to make the project work, with a lot of work on our part. But commercially there are so many different filtration and water systems around using different technologies and then the credit crunch came and it just wasn’t going to work .
“The market’s response was ‘this is a great system for UV sterilisation and we know it works, but it is not the right time, we are not spending any capital expenditure. Come back in two or three years’.
“We are still trying to commercialise this project. UV Energy is sitting at a loss of about £200,000. We’re speaking to people on a regular basis trying to find people to buy this. When that happens, as Sandy seems to forget, he will get some money out of this. It will eventually turn to something.”
Thornton acknowledged that Caledonian does not employ any technically-qualified people or scientists but insisted it draws on the expertise of academics at universities, including the University of Strathclyde when required, as well as independent consultants, with which he said the Scottish Government is comfortable.
A spokesman for Scottish Enterprise said Dr Spowart’s allegations had been investigated by his agency and Audit Scotland – although Dr Spowart disputes this, claiming there has been no full investigation.
Scottish Enterprise said: “A number of different bodies have concluded there is no substance to the allegations. We feel the matter has been fully investigated already and, as far as we are concerned, the matter is closed.”
A Scottish Government spokesman said: “Funding was provided properly and through regular channels to fund the R&D element of this project, which progressed in line with the requirements of the grant.”
This article was published in the Sunday Herald on 4 April 2010.