Jail?
Jail sounds like an ugly rumor to me? Probably should not post that unless you know for sure?
I don't want Doug to get sued. If its true its true but can you confirm it?
I talk to them a few years ago. Did not hear about jail, but here is the scoop albeit dated. They started up and offered a product. They gave a set the Rutan (forget which one) and he flew them around on his LongEZ. Well Rutan wanted technical support and demanded a lot, so there was a falling out. (this is the side I heard.) Any why Rutan took them off. Why? It was just unpleasant but did not hear of technical issues. They may be some but did not hear them. Sounded personal not technical.
As far as the company, they lost a supplier or provider of some key mechanist service. They also lost access to dynamometer facilities. Last I heard they had some improvements they wanted to do. They where looking to fill the supplier problem. Apparently the casting and machining is very complicated and scrap rate "training" a new supplier was an issue, I vaguely recall.
Now my personal opinion, it is interesting. But check the cost, last was $12k for a 4 cylinder set-up, and I don't think that included the radiator. They would supply a spec and a vendor but the radiator was custom. They had no FWF kit, WHICH IS THE PROBLEM with water cooling. Where do you put the radiator. So they left the radiator up to the installer. Of course its all experimental than and still. They did have a Piper flying around and developed a set-up for that. The pics on their site show this. Interesting.
Bottom line, cost, no doubt weight and installation are road blocks. You can buy 4 air cooled jugs, with everything, valves, piston, rings for $4000, plus NO RADIATOR TO MOUNT, the whole engine is a radiator.
The million dollar question (or +$12,000 question) is WHAT DO YOU GAIN? I can't tell you but they claim more reliability, more power, smoother, quieter, cleaner oil........? I don't know for sure. There are advantages, but is it worth the extra cost, effort and no doubt weight and extra drag?
I criticize airplane radiator installations as being draggy from my Aerodynamic eyeball. Its hard to install a radiator on a tractor plane, originally designed for an air-cooled engine. There is no room. Frontal area and cowls are small. Cooling drag is a premium factor in aircraft performance. An air-cooled engine has its "radiator" incorporated with the engine, it's integral, so it saves space. Also Lycs are oil cooled. The oil cooler is a liquid cooler or radiator. Lycs use oil cooling to supplement valve cooling with sodium filled valves.
As far as reliability, I bristle at claims there is systemic issues with Lycs. Yes there have been spurious manufacture defects, manufacturing, not design. Yes engines in the field have been built poorly (not torquing rod caps). However when it comes down most failures, maintenance and pilot operations, including prop strikes being ignored, are major causal factors.
There are limitations but water cooling is not a panacea. If you start with a well built new Lyc/Lyc clone and fly it often (not neglected or in disuse for extended time), fly with in normal temps (not hard to do), keep CHT at below 400F, OT at below 210F and change the oil, you can go TBO and past routinely. I have done it on fleet planes as a CFI, freight pilot and on my own personal planes. Yes occasionally "stuff happens", but I don't see cool jugs changing the Murphy's Law / stuff happens equation much. If it was good than why has it not been done. Continental is still messing with water cooling but I think if you buy a new Beech Bonanza or Baron it will be air-cooled.
If given a set or cool jugs or the oportunity to buy a set for the same price as stock cylinders, I would think about it. I also think a RV is a tough choice for water cooling. A pusher is a better plane for water cooling because there's room to develop radiator inlets and fit them. Also pushers tend to be fiberglass, making integral duct work in the airframe easier. The Voyager Rutan plane flew around the world unrefueled on a IOL-200 water cooled continental. Of course they used the air-cooled front engine way more than planned. Why has Continental or Lyc jumped on this water cooling craze? (The first powered airplane to fly, Dec, 17, 1903, the Wright Flyer I was water cooled). I do think a lot of it is inertia in current air-fame design. A retro fit is hard to do. However engines designed from the start with a water cooled engine in mind fair better. A lot of Rotax 912's are floating around, but they are small engines in size and hp. It's easy to fit a radiator for a small hp engine.