EarthShell Corporation, (Nasdaq:ERTH) innovators of patented, environmentally preferable foodservice packaging, announced today that Italian-based Novamont S.p.A. (“Novamont”) has dismissed without prejudice three of four counts of patent infringement involving two U.S. patents. The claims involved EarthShell environmentally preferable foodservice packaging products, consisting of a new-to-the-world composite material made primarily of abundant limestone and renewable starch.

The dismissal of these three claims confirms that they were without merit and the one remaining claim is also considered to be without merit, according to a company spokesperson. EarthShell and its parent company, E. Khashoggi Industries, LLC (“Eki“), have taken aggressive action to defend its patents and will continue to do so in the future, either by filing suits against infringers or by defending claims against the company.

Additionally, BIOTECH, a wholly-owned subsidiary of EKI, was awarded $1,000,000 in damages, by the Central Court of California, in a patent infringement suit against Novamont and its United States distributor in August 1999. The judgment confirmed that Novamont’s class Z101U, ZF03U, ZF03U/A, AI06H/L, AI06H, Y101U, NF0IU “Mater-Bi” products infringe all asserted product and all asserted process claims.

EKI is a research and development company specializing in the development and commercialization of environmentally preferable materials. EarthShell has an exclusive license to commercialize the EKI patents for composite material technology to manufacture foodservice packaging.

EarthShell Packaging is considered an environmentally preferable alternative made from new-to-the world composite material, which consists primarily of abundant limestone and starch. It uses less total energy and results in low greenhouse gas emissions when compared to traditional packaging. EarthShell Packaging is strong and provides good insulation. It biodegrades in marine and composting environments, and is recyclable through composting.

This press release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties of other factors which may cause actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Factors that might cause such a difference include, but are not limited to, those discussed in the Management’s Discussion and Analysis of Financial Condition and Results of Operations in the Company’s most recent Form 10-K and other documents filed by the Company with the Securities and Exchange Commission.