Chinese EV firm Nio accused of exploiting Better Place patents in $250 million suit

Nio rejects claim it is infringing on intellectual property of Charge Peak, which acquired patents after pioneering Israeli electric car company folded

The owners of the patents from the once-pioneering but now-defunct Israeli electric vehicle company Better Place are demanding approximately $250 million from the Chinese EV manufacturer Nio.

The claimants accuse Nio of “exploiting, without permission or license, the Israeli Better Place model, technology, experience and IP,” thereby infringing on its intellectual property.

Better Place, which filed for bankruptcy in 2013, was a trailblazer in battery charging and battery-switching technology for electric vehicles. Although headquartered in California, it was led from Israel by its founder, Shai Agassi. At its height, the company operated 21 battery-swapping stations across Israel.

Following the company’s collapse, its patent portfolio was acquired by Charge Peak, a company registered in the British Virgin Islands and controlled by Canadian businessman Larry Krauss. Charge Peak is currently the sole owner of the portfolio’s European patents.

Nio was established in 2014. According to a letter sent to the manufacturer on behalf of Charge Peak, the Chinese firm now operates over 3,700 battery-swap stations in China and at least 60 in Europe, including 20 in Germany, utilizing technology allegedly protected by three of Better Place’s European patents.

Battery swapping, which takes just a few minutes, is popular for long-distance travel and for apartment dwellers who don’t have a dedicated recharging place at home.

Nio has refuted Charge Peak’s allegations. In a statement to the Financial Times, which first reported the story, the company asserted that the technology used in its stations was “materially different from the three patents referenced in the claim.” Nio further noted that it has filed more than 2,200 of its own patents related to battery charging and swapping.

“Such allegations are unfounded in both fact and law, and are inconsistent with the realities of technological development in the industry, as well as Nio’s actual R&D practices,” the company stated. It maintained that its technology was the result of “years of independent R&D and continuous iteration,” and that it would take “appropriate” legal measures to protect its “lawful rights and interests.”

However, the letter from Charge Peak argued, “It is widely acknowledged that Better Place pioneered battery swap and EV electricity management, and its key patents are still in force, especially the foundational family of patents around battery swap. Nio’s strategic business advantage in building its $16 billion company has been its exploitation, without permission or license, of the Israeli Better Place model, technology, experience and IP. This needs to be rectified immediately.”

The correspondence continued: “In 2013, our client acquired the Better Place IP portfolio, including the foundational patent family for electric vehicle battery swap technology. Better Place, the world’s pioneer in developing and deploying battery-switching services for electric cars, opened its first charging station in Israel as early as 2010, four years before Nio was even incorporated. These battery-swap stations enabled battery-switching technology for cars and for different OEMs (Original Equipment Manufacturers).”

Charge Peak has issued a deadline of June 5 — World Environment Day — for Nio to either reach an agreement to acquire the entire portfolio of over two dozen patents or submit a cease-and-desist declaration. The latter would require Nio to compensate Charge Peak for all damages and lost revenue, destroy all battery-swap stations utilizing the contested technology at its own expense, and reimburse Charge Peak’s legal costs.

Clarifying that a potential deal could involve a mix of cash and shares, Charge Peak has set an acquisition benchmark of 2% of Nio’s 2025 global revenue. Based on $12.5 billion in revenue, the demand totals $250 million.

Solar entrepreneur Yosef (Yossi) Abramowitz, who previously attempted to help acquire Better Place before the patents were sold to Charge Peak, commented, “Israeli EV knowhow was unfairly exploited to build a $16 billion company, so asking for 2% of Nio’s 2025 revenues is not unreasonable.” He added, “Nio’s expansion plans in Europe are driving its share price, and so it’s time to make a deal.”