BlueStar Technologies Inc., the Blu-ray disc producer here formerly named BlueRay Technologies Inc., claims in a press release issued online last week that it has developed a system that allows consumers to record on Blu-ray discs, but still provides protection against piracy to movie studios and game developers.

In an earlier press release, the company said it has secured fresh funding from European partners and plans to open a factory in Rome this summer, and is considering opening another U.S. facility, possibly in Montana or California.

In Spokane, though, BlueStar continues to be dogged by financial concerns, including unresolved charges by a Spokane investor couple who say they've been unable to get President and CEO Erick Hansen to provide detailed corporate financial documents for them to review.

Also, BlueStar has yet to announce the beginning at its downtown Spokane plant of any mass production of Blu-ray discs for clients, though it opened the plant nearly two years ago. Hansen couldn't be reached for comment, but he had said last year that he hoped the plant would employ as many as 120 people and would be producing and distributing 100,000 discs a day by now, and he predicted it eventually could grow to as many as 450 workers. At last report, though, it employed only a handful of people. Its plant is located in the Commercial Building, at 1119 W. First.

He boasted in BlueStar's latest press release that the company's new proprietary StarFire anti-piracy encryption and laser-firing system on its manufacturing lines here—and soon in Europe—could make Blu-ray content piracy "a thing of the past."

"Part of our pirate-proof disc is that anyone, anyone can just look at the disc and see if it's pirated. It's not just a number watermark like DVDs and BDs (Blu-ray discs) use now," he said. "We are the only firm in the U.S. doing these incredible things that will be a boon both to consumers and copyright holders."

In addition, he said, BlueStar has devised a way to put the label ink on a Blu-ray disc with a special holographic technique that not only is hard to pirate or exploit, but also is environmentally friendly.

Blu-ray discs are high-definition DVDs that use a proprietary format. Piracy involves the illegal manufacture, sale, distribution, and trading of discs that contain copyrighted content. Pirated releases are sold through various methods, including by street vendors and in flea markets, around the world and are a huge concern of copyright owners.

In the earlier release, BlueStar said its planned Blu-ray plant in Rome would manufacture Blu-ray discs for the European continent and United Kingdom, and would be the largest and most green-friendly plant of its kind in western Europe.

Here in Spokane, Barb Pielli says she and her husband, Mike, who loaned Hansen $25,000 and worked at BlueStar for five months last year as shareholder volunteers, are continuing to seek corporate financial documents from him to help them gauge the health of the company.

"It's not about the money. It's about the fact that he's not running things right, and he's trying to get money from more people," says Pielli, who did bookkeeping for BlueStar while volunteering there. "In my opinion, he's too far in the hole. I think he's going to run this thing right into the ground. From the moment we started there, money was not being spent where it needed to be spent."

She says she and her husband earlier had filed a lawsuit against Hansen here over his alleged failure to repay them $24,000 that they provided to get electrical systems at the plant up to snuff so it could obtain a certificate of occupancy last fall, but dropped the suit recently after he repaid them that sum.

BlueStar and Hansen have had a number of other legal problems. Hansen lost a $280,000 default judgment to Wells Construction Inc., of Spokane, late last year after failing to respond to a lawsuit over remodeling work Wells performed in the building BlueStar occupies.

Also in December, to settle a securities fraud case in Los Angeles County Superior Court, BlueStar, Hansen, and two associates agreed to offer full refunds to all California residents who invested in the company, plus pay 10.5 percent of the original investment account, unless they declined the offers. Additionally, although the settlement didn't require an admission of wrongdoing, the defendants agreed to pay $50,000 in civil penalties and to refrain from selling securities in the state unlawfully. BlueStar, then still named BlueRay, moved to Spokane from the Los Angeles area in early 2007.