Saturday, June 06, 2009

Business ethics and cuts by a thousand lawyers.

A long time ago a normal mortal  could buy rocket grade peroxide. Then someone crashed their rocket pack and sued the  peroxide supplier.They won and the supplier lost more on that suit than they had erver made on the small rocket grade perxode sales. So they did the smart thing and stopped selling rocket grade peroxide to anyone that did not have a government contract.


Three or four months ago I was very worried about peroxide availibility as peroxide propulsion was not running and xlspace systems had stopped producing. So I set about to refine my own. Stabilized 50% hydrogen peroxide is a widely used industrial chemical, and seemed to be generally availible.  I consulted with an expert that had been in the usiness of refining rocket grade perixude and decided to follow his reccomended process.


I got a sample 55 gal drum of 50% food grade from the local chemical supplier and built the plant to do the process. If you can get 70% semiconductor grade you cut out two steps from the process.  There are only two chemical suppliers doing bulk proixde distribution in the U.S. One got burned as described above and will not sell to anyone that is doing “rocketry”. the other suppleir does not produce rocket grade peroxide, they do produce 70% semi. so we started the process of having them review our facility and procedures so they would sell us 70%, rather than the commonly availible 50%. After a number of weeks and many exchanges we got the following response:


First thank you for your time and patience as XXXXX reviewed your request to purchase hydrogen peroxide.  As outlined in your information, your process would concentrate the material to 85-90% for use in rocketry.  You forecast an ongoing use of ~ 10K lbs per year of 70% product.

Our review involved the technical aspects of your work, product stewardship, regulatory affairs, and a legal & liability review.Everyone was impressed with your facility and apparent knowledge of hydrogen peroxide handling.


We have made the decision not to supply Unreasonable Rocket directly or through distribution.  Our decision was really made based on our perceived risk of exposure for a very small volume of business.   We will also communicate this to XXXXXX(the distributor we were buying 50% food grade from.)


We wish you well in your future endeavors and look forward to reading about your successes.


So if I had hidden what I do, or been dishonest about where the peroxide was going I could have continued to buy the 50% food grade. Now niether peroxide supplier will knowling sell even the 50% food grade if it is going to Unreasonable Rocket.  I know of others using peroxide for rockets that have set up shell companies “bozos chemical safety systems” or the like, buy peroxide under an assumed use and then refine for their rocket belts, drag cars or whatever. Others have “friend companies” buy it for them etc.. My personal business ethics don’t feel comfortable with that. As a result of being honest and upfront about what I’m doing the  door is closed.


No discussion of what insurance do you carry, what sort of liability release will you sign etc… Just no. People should be allowed to take risks. My familiy knows that if something happend to me it was my choice. They also know how strongly I feel that lawsuit lottery is destroying the fabric of what made the USA  great. Americans were once risk takers.  


What we are doing is far enough outside the normal industrial processes that any one doing business with us is not following their carefully coregraphed ISO9000 script. As a result the system is not perfect. That is why when I get a valve that supposed to have compatible materials in it I TEST IT. If I asked for viton and they sent buna-n then they screwed up, in the normal  events that sort of screw up would cause a leak. With 90% peroxide it could cause an explosion.  This is my responsiility, a larger  organization would have a detailed incomming inspection for anything that critical, I don’t so its my responsibility.  Its why we test things at FAR were we have a bunker to hide in. Its whey we presurize and fly the vehicle remotely, its why we make people at FAR seek shelter in the viewing bunker when we are trying something untested.  What we do is risky, but we try not to take stupid risks.  When I started going to FAR I looked around  and saw a bunch of 40+ year old guys that normally drive a desk out in the hot desert sun doing hard physical lablor. One of my very first donations to the place was an AED automatic defibulator and a breathing  oxygen bottle. At the time it was the largest check I had yet written for my new rocketry hobby. 


If I screw up amd blow my self up, it was my choice to take the risk, its not the fault of whatever other things happened in the chain of cauasality, I knowlingly put myself in that position.


Damm the lawyers.


BTW we flew the blue ball tethered in high winds today and got mixed results, no damage, but control problems in the winds. more later.

127 comments:

David said...

Hear Hear. You are absolutely correct - your talking the responsibility and the acceptable risk so there should not be an issue. They should still sell the more common 50% grade to you as its not their problem you are refining it further. Anyway, you did not indicate your options - maybe a good idea. Any way, hopefully you can sort out some avenue. If not consider going back to the bi-prop LOX/Alcohol combo? Big move but at least you have the experience so it would not take long to add a tank and one of the older engines you might have around the shop. Wish you well.

Anonymous said...

Being honest is one thing. Saying too much is another. I sometimes will over-disclose trivia that I find the audience is incapable of understanding, so they get that "look" in their eyes and wander off. Be brief, disclose only the minimum requirement, and pray often. Less is more, and this is still ethical and honest.

Anonymous said...

I would agree with the previous post of too much information. By providing ALL the information, as far a legal issues you have now put the seller in a position of making a conscious decision as to whether or not further refinement is "safe".

The immediate reaction to my statement will make a lot of people say "no way!", but lets look at it from a different angle and not make it specifically about you. A fictitious Bob and his son do the exact same thing. Bob and son blow themselves up, along with one or two other people. Bob and son know its their fault, and if they were still alive, would not take action.

But, Bob has a brother Joe he hasn't seen in a decade and is on welfare. Smelling money, Joe sues the seller. The families of the other two people sue the seller as well, maybe because they think there was negligence.

In court, the seller's defense is that they knew what was going on, but that Bob took full responsibility. The prosecutor's case is that the seller reviewed the processes, and the specific action of selling the materials with full knowledge of the process means they are culpable. Otherwise the only other possibility is that they reviewed the process and deemed it unsafe, but sold to Bob anyway. This didn't go over well with the tobacco companies.

Ethics have nothing to do with this. If you purchase a product you should be able to do what you want. But don't put the seller, employees and their families at financial risk by forcing them to analyze data they probably don't care about, with legal consequences. The supplier that went out of business is proof that there is risk.

I'm not sure what it cost them to review all this and come to a decision, but I would give them credit for doing so. The had very little to gain as far as a business decision goes, and a lot to lose if things went wrong.

Although the lawyers share the blame here, so too do those who contact them to file frivolous lawsuits.

There are many ways to look at this, its just my opinion.

Peter Lund said...

"Although the lawyers share the blame here, so too do those who contact them to file frivolous lawsuits. "

They only do that because it sometimes pays off to spill coffee on yourself and sue McDonald's :(

That and your waist sizes are probably the things we Europeans find most incomprehensible and scary at the same time ;)

Good luck with plan b!

David said...

I think the key here is whether a waiver could be signed to remove all possible avenues of (legal) risk from the provider of the peroxide. The problem is it only get tested when legal action occurs which is what is trying to be avoided in the first place. Might be best to import the product but then I would imagine there would be other cans-of-worms in that arena as well. The lawyers are the core issue as their professions actions has resulted in the dilution of the concept of personal responsibility. Maybe time to import the lower grade peroxide but this may open another can-of-worms. Good luck.

Stevo Harrington said...

Paul,
Don't blame the lawyers. That is like blaming a boxer's opponent for giving him a concussion. The lawyers are playing by the rules, the rules are made by politicians that get elected by us.
If we got fooled by a slick ad into voting for some bullshitter who took money from the trial lawyers and the insurance lobby in order to maintain the profitable status quo, the fault is our own.

Steve

ザイツェヴ said...

Stevo is wrong, because lawers are not disinterested tools. They are paid percentage of settlements, and that is why they have set up a machine of wealth transfer, fueled by the frivoulous lawsuts. Lawers are directly culpable in manufacturing the current legal climate.

In any case I would request a quote from XLspace before I started cooking my own peroxide.

Anonymous said...

Speaking as a lawyer, yep, damn the lawyers. The notion of individual responsibility is dead among lawyers.

Waivers aren't good enough because most states let you get around them or else, by law, invalidate them. Waivers also don't apply to third parties.

And those commenters who say the peroxide supplier hurt themselves by investigating your process are correct.

-Adam Greenwood

Alexander DeClama said...

Agreed. The lawyers are complicit in the creation of the sue first culture we live in. Nevermind the fact that most of the politicians that make the rules are lawyers themselves.

Anonymous said...

The solution requires President Obama to immediately appoint a rocket Czar answering only to him in the White House and maybe the SFF as well. Then Unreasonable Rockets gets federal funding for an "approved" peroxide lab and that then allows Obama to be the new CEO of the company as Frank et al nationalize Unreasonable Rockets because you work in the garage that is connected to or associated with your house. While you may get fired, if you sign on to this plan early on with praise and awe, you will be allowed a minor role serving the new CEO. Now that proper management has been installed, no company would dare not sell their product (peroxide) under fear of all sorts of retribution from name calling to everything else you can imagine. This is the solution. Paul, this might be hard for you to take at first but this is the new path awaiting for you and ultimate success. Think about it before going ballistic or postal. I'm sure that with at least 24 hours of thought, you will see the wisdom of such a program.

For the position of rocket Czar, there should be plenty of space enthusiasts from Gen Y, maybe around 20-22 years of age. Experience is not a requirement for a Czar position. Remember that. The only thing a Czar needs to know is the email address, phone number, and physical address of who he/she is supposed to say yes to on a daily basis. Its really simple. An easier way to earning big bucks has not yet been created.

Best of luck.

Mike Puckett said...

"We will also communicate this to XXXXXX(the distributor we were buying 50% food grade from.)"


Frankly, I wonder if you could sue them for doing this. I wonder if it constitutes a breech of confidentiality or a conspiracy.

Is said...

You're right. Damn the lawyers and the companies who won't sell you something, even with a waiver. Ridiculous. The same thing is, most Americans don't have a clue about how frivolous lawsuits have hurt us.

Anonymous said...

Off topic but correcting the record: Peter Lund brings up the old McDonald's coffee suit. The reality is that the plaintiff was a very old lady, the McDonald's coffee was significantly hotter than that dispensed by other drive throughs as determined by actual testing, she sustained major scalds that required skin grafts and, if I recall correctly, the lid was not applied fully and came off as she took the coffee from the attendant. That has also happened to me at McDonald's more than once, but I am very careful to not tip the cup as I take it and check to assure that the lid is fully seated. That is individual responsibility but I can see how the old lady was scalded without being completely negligent on her own part.

Thalia.ad.astra said...

The solution requires President Obama to immediately appoint a rocket Czar answering only to him in the White House and maybe the SFF as well.

I nominate Jon Goff.

Is said...

a Czar? More bureaucracy is not the answer. Just make sure public safety is maintained and allow individuals to risk their own life and limb for science.

With our risk averse culture we are just hobbling ourselves. No more John Waynes, no more so-called crazy people doing "crazy" things to achieve a dream.

It's sad.

Anonymous said...

Anonymous 12:10,

You couldn't have gotten the Stella Liebeck case more wrong if you had tried. 1. She was in her 70s, that ain't that old Skippy. 2. Her young relative was driving. 3. The cap was on tight, #2 stopped to allow her to add sugar and cream, she attempted to hold the cup between her sweat-panted knees and it slipped. 4. The coffee was no hotter than other establishments, and when MickeyD's later lowered the temp they lost business to other establishments who sold hotter coffee.

I suggest you wander over to

http://overlawyered.com/2005/10/urban-legends-and-stella-liebeck-and-the-mcdonalds-coffee-case/

and get your "correction" corrected.

Anonymous said...

Soon after the McDonald's verdict the Wall Street Journal ran a good article on why McDonald's lost, and the gist of it was that their lawyer was obnoxious and antagonized the jury. Sometimes it's not about the facts.

Anonymous said...

I guess you might already know, but wikipedia mentions some different manufacturers.
http://en.wikipedia.org/wiki/High_test_peroxide

Paul said...

Solvay Inerox,
FMC,
Degussa and
Peroxide Propulsion.
They left off XL space systems, now back in production.

I've been using peroxide propulsion peroxide.

Only two of the others have a US presence for peroxide.

David said...

Paul,

Good to see there are still quite a few options to continue down this path. I was getting worried for you as all of the peroxide based teams have not progressed past the point your at now while the two Lox/Fuel teams have moved a step further. I am hoping this all get sorted for you.

Question: Now the peroxide issue can be worked around; How are you going to remove the Tin contaminant from the peroxide that is fowling the catalyst after a 60 sec run? I would assume further processing by your purifier will do the job for you. I do wonder why it is there in the first place.

Anonymous said...

Conjecture walks here:

For those saying dont ask, dont tell, unfortunately suppliers read the news and this rocket should be in the news. If they all ban supplies it might ground the project until another engine is designed. Better to know early if you have a sure supply.

David said...

Well I answer one thing with a quick google search; e.g., the Tim is a stabilising agent add to high purity peroxides.

If Paul wants to move to a Lox/Fuel engine then I am sure he can do so in a very rapid fashion. Experience exists already. Just be easier if it did not need to occur. Also, retains current value in the existing investment in gear and processes. Any way, time will tell the story as I am sure Paul has considered all the options.

Paul Breed said...

More news on this front in the next 72 hours.
Paul

dzdt said...

"I feel that lawsuit lottery is destroying the fabric of what made the USA great. Americans were once risk takers."

Hear, hear! The U.S. system for damage payments in lawsuits is perversely broken.

On a different note, I see a summary of the LLC 2009 rules have been posted at http://space.xprize.org/lunar-lander-challenge. If I read right, it looks like teams can fly basically at their convenience (up to arranging to have judges present) between July 20 and October 31. Looks pretty reasonable. Hopefully we'll see some successful flights this summer!

Carl said...

The real problem is there isn't a substantial risk to the sue-er in frivolous lawsuits. In a system where the loser of the suit is forced to pay the winner's legal fees, there is a really strong incentive to *not* go to court in the first place, on the chance that you'll lose.

The current american legal system often causes the winner to pay the legal fees for his own defence; so even if you win, you can be put out of business. This is what puts defendants at such a disadvantage when it comes to ridiculous lawsuits, and is heavily responsible for the litigious legal climate we're in right now.

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