Zess Technologies Inc., which had hoped to turn a new type of heat exchanger into a $30-million-a-year business enterprise with help from the Spokane Intercollegiate Research and Technology Institute and Washington State University, has filed for bankruptcy.


The company, headed by engineer Jim Zess, who invented and patented the heat exchanger, is seeking to liquidate under Chapter 7 of the U.S. Bankruptcy Code. In documents filed in U.S. Bankruptcy Court here last month, it listed liabilities of more than $202,000 and assets of less than $50,000.


Zess declined to comment on the bankruptcy filing.


Jim Roberts, SIRTIs technology commercialization manager, says he was surprised to learn of the filing. He says Zess Technologies vacated space it had occupied on the first floor of the SIRTI building, at 665 N. Riverpoint Blvd., about a year ago. At that time, he says, it was on the verge of being able to take its heat exchanger to the marketplace.


We had done proof of concept. It was very close to commercialization at that point. I thought it did have some commercialization potential, Roberts says. He says he doesnt know whether the technology will be abandoned or perhaps picked up by some other company interested in trying to commercialize it.


The commercial heat exchanger industry is a $1 billion market, according to background information on SIRTIs Web site describing its involvement with Zess and WSU in the heat-exchanger project.


Zess Technologies received a $200,000 U.S. Department of Defense grant through SIRTI to develop new materials and methods that Zess believed would allow it to produce its heat exchangers at a lower cost.


Heat exchanger is a general term used to describe devices such as radiators and condensers that transfer heat energy from one medium to another for heating or cooling. The one that Zess invented is a commercial-sized adaptation of tiny units developed initially by researchers in Silicon Valley in California and later by Battelle Pacific Northwest National Laboratories in the Tri-Cities for use in cooling electronic equipment.


It uses whats called micro-channel technologyin this case, numerous tiny channels about 10 thousandths of an inch wide cut into 12-inch-wide metal platesto circulate fluid. Zess claimed that the companys patented heat exchanger, in which the channeled plates are stacked up to fit whatever the system demand would be, is smaller and more efficient than traditional heat exchangers. Thus, it would offer potential cost savings when used for heating and cooling structures such as supermarkets, hotels, and hospitals, he said. It also would have potential industrial-process, military, and mobile applications, he said.


He predicted in the summer of 1998 that the product research launched here will give us not only the most efficient heat exchanger in the industry, but also the lowest cost heat exchanger available. He said in an interview later that year that the companys business plan called for it to reach annual sales of $30 million in five years.


Zess is a longtime physical engineer who holds an undergraduate degree in nuclear engineering and a masters degree in environmental engineering. Originally from the Midwest, he moved to the Pacific Northwest in 1989 to work for Portland General Electric Co., and left there in 1993 to form his own firm, called Zess Engineering & Environmental Science.


He got the idea for the new heat exchanger in 1995 while working with scientists and engineers at Battelle in the Tri-Cities. The staff there had built a tiny exchanger to cool some electronic equipment, and Zess visualized its potential in larger applications. He formed Zess Technologies in January 1997 to develop and sell a larger version of the micro-channel heat exchanger. The company originally was based in Portland, Ore.