Where do I start when trying to describe 2011 for American Superconductor (Nasdaq: AMSC)? Disaster, bribery, and confusion are a few of the words that come to mind. From a promising start to the year and growing revenue, the company took a turn for the worse, and it started with a man named Dejan Karabasevic.

The day everything changed
Karabasevic used to be an employee at American Superconductor, an employee trusted with proprietary code that made the company's technology valuable. But as the story goes, when he was demoted he got mad and tried to get even by selling trade secrets to customer Sinovel.

When Sinovel got the brains to American Superconductor's technology, it refused shipments and refused to pay for contracted product. This is China, after all, where almost anything goes.

So the stock plunged, a deal to purchase The Switch fell through, and as of this writing, American Superconductor's shares are down 86.1% on the year.

Getting back at Sinovel
American Superconductor has filed two suits against Sinovel for stealing intellectual property. But in China, there's no certainty that these suits will get very far.

The industry is watching these suits closely to assess just how serious China is about protecting intellectual property. I'm not holding my breath.

Grid as the future
With the wind business in a state of flux for the year, the grid business has taken a more important role. The goal for the company is to gain a foothold in the interconnection, reliability solution, and power cable business to serve primarily the renewable energy segment. But when facing up with most established competitors like ABB (NYSE: ABB), Power-One (Nasdaq: PWER), and even Satcon Technology (Nasdaq: SATC), it's an uphill battle.

The company is expecting the grid business to account for a growing percentage of revenue, but with just $20.8 million in revenue last quarter, that isn't saying much.

The only way is up
The disaster of a year has led to major shakeup in management and has left investors in ruins. And unless conditions improve quickly, American Superconductor will be left on life support. For a year that started with so much potential, 2011 is one most investors in this stock would like to forget.

Interested in reading more about American Superconductor? Click here to add it to My Watchlist, which will find all of our Foolish analysis on this stock.