Case IPR2014-00216
`Patent No. 6,179,053
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`UNITED STATES PATENT AND TRADEMARK OFFICE
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`____________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
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`____________
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`GREENE’S ENERGY GROUP, LLC
`Petitioner
`
`v.
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`OIL STATES ENERGY SERVICES, LLC
`Patent Owner
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`____________
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`Case IPR2014-00216
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`Patent 6,179,053
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`________________________________________________
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`PATENT OWNER’S COMBINED MOTION TO SEAL
`AND MOTION FOR PROTECTIVE ORDER
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`Case IPR2014-00216
`Patent No. 6,179,053
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`Pursuant to 37 C.F.R. § 42.54, and the conference with the Board
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`authorizing the motion on August 25, 2014, Patent Owner Oil States Energy
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`Services, LLC (“OSES”) moves to file certain Exhibits filed with its Motion To
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`Amend Claims (Paper 21) under seal. As detailed below, these Exhibits contain
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`highly confidential and extremely sensitive information related to financial
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`matters pertaining to Patent Owner’s core business. Further, as set forth below,
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`Patent Owner also requests entry of the Protective Order attached to this Motion.
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`Counsel for Patent Owner contacted Counsel for Petitioner, Greene’s
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`Energy Group, LLC (“GEG”) and requested Petitioner’s consent to file certain
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`Exhibits under seal and for consent to enter a modified Protective Order. The
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`parties have been unable to reach an agreement with respect to the modified
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`Protective Order, and Patent Owner understands that Petitioner opposes this
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`motion. Specifically, although Petitioner has not objected to the filing of certain
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`materials under the Default Protective Order, Petitioner objects to the two-tiered
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`format of the Modified Protective Order proposed by Patent Owner that includes
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`an “Attorneys’ Eyes Only” provision. Counsel for Petitioner insists that
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`Greene’s in-house counsel be allowed to have access to the Attorneys’ Eyes
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`Only materials that Patent Owner seeks to have sealed. However, due to the
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`granular and highly confidential nature of the Attorneys’ Eyes Only information
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`contained in the relevant Exhibits, Patent Owner requests that that the attached
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`Patent No. 6,179,053
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`Modified Protective Order, which differs from the Model Protective Order only
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`in that it contains a second tier of confidentiality, be entered so that the small
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`number of identified exhibits may be designated “Attorneys’ Eyes Only.”
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`Further, Patent Owner seeks to have certain Confidential (but not Attorneys’
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`Eyes Only) information sealed from public view under paragraph 2 of the
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`Modified Protective Order, which mirrors the provisions for Confidential
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`material in the Default Protective Order.
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`I. GOOD CAUSE EXISTS FOR SEALING CONFIDENTIAL
`INFORMATION
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`The Office Patent Trial Practice Guide provides that “the rules aim to
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`strike a balance between the public’s interest in maintaining a complete and
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`understandable file history and the parties’ interest in protecting truly sensitive
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`information.” 77 Fed. Reg. 48756, 48760 (Aug. 14, 2012). Further, those rules
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`“identify confidential information in a manner consistent with Federal Rule of
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`Civil Procedure 26(c)(1)(G), which provides for protective orders for trade secret
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`or other confidential research, development, or commercial information.”
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`Id. (citing 37 C.F.R. § 42.54).
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`As summarized in Table 1 below and detailed below, Patent Owner is
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`submitting two categories of financial information to support arguments
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`presented in Patent Owner’s Motion to Amend. The first category of
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`Patent No. 6,179,053
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`Confidential information includes summary and other high-level financial
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`information that falls under paragraph 2 of the Modified Protective Order.1
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`Patent Owner does not believe there is any dispute that this “Category 1”
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`information would be considered Confidential even under the Default Protective
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`Order, and thus should be sealed under the “standard” confidentiality provisions.
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`Based on the arguments presented in the Motion to Amend, Patent Owner
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`believes that the Board will need to rely only on this summary information in
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`making its determinations. Similarly, Patent Owner believes that the Petitioner
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`will need to rely only on this summary information in formulating its arguments
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`in response to the Motion to Amend. Patent Owner acknowledges and
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`understands the Board’s comments that Confidential materials relied on in any
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`decision regarding patentability may become part of the public record.
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`The second category of information is Highly Confidential – Attorneys’
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`Eyes Only – financial information at a granular and competitively significant
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`level. There are only four spreadsheets that would qualify as “Category 2”
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`information, copies of which are attached to this Motion for the Board’s in
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`camera review. This information serves as the underlying foundation for the
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`summary information provided as “Category 1” material. Patent Owner presents
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`this level of detail only to provide the Board and Petitioner with its basis for the
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`1 As noted, this information would also be considered Confidential information under the Default Protective Order.
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`arguments and conclusions presented as summary information associated with
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`the Motion to Amend. That is, this detailed supporting information is not
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`material to any arguments or claims presented by the parties and will not be
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`necessary for any determination of patentability. For example, the names of
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`customers and the number of orders each customer placed, is not material to
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`patentability, nor does Petitioner need access to this type of invoice-level detail
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`to formulate its arguments in opposition to Patent Owner’s Motion to Amend.
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`Instead, only the aggregate sales volumes or revenue numbers presented as
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`summary information (i.e., Category 1 material) are relevant to the financial
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`arguments presented by Patent Owner.
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`This type of highly confidential financial information has been designated
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`Attorneys’ Eyes Only in the co-pending litigation and Petitioner’s in-house
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`counsel and employees have not—and will not—have access to this information
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`under the Protective Order in that case. Indeed, detailed customer-level
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`information would typically never be provided to Petitioner’s in-house counsel
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`or the general public in any context. Such disclosure of this information would
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`significantly harm Patent Owner’s competitive position as it would allow a direct
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`competitor to access some of the most sensitive financial information there is.
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`Allowing Petitioner access to Patent Owner’s “crown jewels” of financial
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`information in this proceeding would be both unnecessary and dangerous.
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`Patent No. 6,179,053
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`The public interest will not be harmed by the entry of this attached
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`Modified Protective Order, filing of the Category 1 exhibits under seal as
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`Confidential information, or filing the Category 2 exhibits under seal as
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`Attorney’s Eyes Only. In particular, there should be no reason for the Board to
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`rely on Category 2 material in any decision regarding patentability. Thus, the
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`Category 2 materials should not be implicated. Further, to the extent that any
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`sealed Confidential materials are relied on by the Board in any decision
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`regarding patentability, they may ultimately become part of the public record
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`regardless of the outcome of the instant motion.
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`As mentioned above, Petitioner’s ability to raise its claims or defenses will
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`not be impacted by filing the identified exhibits under seal. In particular,
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`Petitioner (both in-house and outside counsel) will have access to the core
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`financial information that supports Petitioner’s Motion to Amend. Additionally,
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`to the extent Petitioner’s outside counsel needs access to the underlying
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`Attorneys’ Eyes Only information in order to explore the basis for the high-level
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`summary financial information, such access will still be available even under the
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`Modified Protective Order. There is simply no reason why Petitioner’s in-house
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`counsel needs access to the four particular spreadsheets that include such
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`competitively sensitive financial information.
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`TABLE 1 – Proposed Sealed Papers and Exhibits
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`CATEGORY 1 MATERIALS
`To be Sealed as “Confidential” under Paragraph 2 of the Modified Protective Order
`Summary of Contents
`Good Cause for Sealing Exhibit
`Paper/Exhibit
`No.
`Exhibit No. 2018
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`Declaration of Thomas W. Britven Contains Confidential financial
`information—This document contains
`non-public information relating to OSES
`including summary financial information
`with details regarding sales price, profits,
`volumes, etc.
`
`Exhibit No. 2018,
`Attachment 3.0
`
`Summary of OSES Average Net
`Revenue Attribuatable to Stage
`Frac Tool Operations Per Job,
`May 1, 2006-December 31, 2013.
`
`Exhibit No. 2018,
`Attachment 4.0
`
`Summary of OSES' Total Net
`Revenue Attributable to Stage
`Frac Tool Operations
`May 1, 2006 - December 31, 2013
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`Exhibit No. 2018,
`Attachment 4.1
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`Summary of OSES' Net Revenue
`Attributable to Stage Frac Tool
`Operations
`May 1, 2006 - December 31, 2013
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`Exhibit No. 2018,
`Attachment 5.0
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`Summary of OSES’ Average
`Number of Jobs Per Stage Frac
`Tool
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`Exhibit No. 2018,
`Attachment 6.0
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`Summary of Stinger US and
`OSES' Statement of Income by
`Company and Stage Frac Tool
`January 1, 2007 - December 31,
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`redactions at ¶¶ 3, 7, 19, 21-29
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`Contains Confidential financial
`information—This document contains
`non-public information relating to OSES
`including summary financial information
`regarding Net Revenues related to Stage
`Frac Tool.
`Contains Confidential financial
`information—This document contains
`non-public information relating to OSES
`including summary financial information
`regarding Gross and Net Revenues related
`to Stage Frac Tool.
`Contains Confidential financial
`information—This document contains
`non-public information relating to OSES
`including summary financial information
`regarding Gross and Net Revenues related
`to Stage Frac Tool.
`Contains Confidential financial
`information—This document contains
`non-public information relating to OSES
`including summary financial information
`regarding Tool and Job Counts from
`2007-2013.
`Contains Confidential financial
`information—This document contains
`non-public information relating to OSES
`including summary financial information
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`2013
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`Exhibit No. 2018,
`Attachment 7.0
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`Summary of OSES' Average Net
`Revenue Attributable to Casing
`Saver Operations
`May 1, 2006 - July 31, 2014
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`Paper No. 21
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`Patent Owner’s Motion to Amend
`Under 37 C.F.R. § 42.121
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`regarding Revenues, Costs, Margins, and
`Net Income from 2007-2013.
`Contains Confidential financial
`information—This document contains
`non-public information relating to OSES
`including summary financial information
`regarding Revenues, Discounts, and Job
`Counts from 2006-2014.
`Contains Confidential sales
`information—This document contains
`non-public information relating to OSES
`including summary financial information
`with details regarding sales price, profits,
`volumes, etc.
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`redactions at p. 11
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`CATEGORY 2 MATERIALS
`To be Sealed as “Attorney’s Eyes Only” under Paragraph 3 of the Modified
`Protective Order
`Summary of Contents
`Good Cause for Sealing Exhibit
`
`Contains Highly Confidential sales
`information—This document contains
`specific non-public Highly Confidential
`information relating to OSES customers and
`related financial information such as details
`customer name, customer number, location,
`dates, invoice parameters, detailed
`descriptions and notes. Summaries of the
`relevant financial information contained in
`this Exhibit are provided as Category 1
`summary information noted in Exhibit No.
`2018, Attachment Nos. 3 and 4.1, above.
`Contains highly confidential sales
`information—This document contains
`specific non-public Highly Confidential
`information relating to OSES customers and
`related information such as details regarding
`sales by district, sales by quarter, truck count,
`and tool count. The tool information
`contained in rows 147-159 is provided as
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`Paper/Exhibit
`No.
`Exhibit No. 2025
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`Stinger OSES Frac Tools
`Sales Data Spreadsheet
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`Exhibit No. 2026
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`Stinger OSES Tool Count
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`Exhibit No. 2027
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`Singer OSES Yearly
`Financials
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`Exhibit No. 2024
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`Casing Saver Sales Data
`(Casing Saver Rev Round 1)
`
`Category 1 summary information noted in
`Exhibit No. 2018, Attachment No. 5, above.
`Contains highly confidential sales
`information—This document contains
`specific non-public Highly Confidential
`information relating to OSES customers and
`related information such as details regarding
`Stinger OSES Yearly Financials. A summary
`of the relevant financial information contained
`in this Exhibit is provided as Category 1
`summary information noted in Exhibit No.
`2018, Attachment No. 6, above.
`Contains highly confidential sales
`information—This document contains
`specific non-public Highly Confidential
`information relating to OSES customers and
`related information such as details regarding
`casing saver sales data. A summary of the
`relevant financial information contained in
`this Exhibit is provided as Category 1
`summary information noted in Exhibit No.
`2018, Attachment No. 7, above.
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`In the Motion and Declaration identified above, Patent Owner has redacted
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`only the specific information that it considers Confidential (Category 1) financial
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`information, leaving the large majority of its analysis unredacted and available to
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`the public. Accordingly, employees such as in-house counsel for Petitioner will
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`have access to the summary information, arguments and expert analysis
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`presented by Patent Owner. Four Excel spreadsheets that serve as the underlying
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`information for the Category 1 summaries are provided as Attorneys Eyes Only
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`material. As noted above, this information is the factual foundation for the
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`Category 1 summary information. Petitioner’s Outside Counsel will have access
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`to this information to verify the summaries and will be afforded a full
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`opportunity to present Petitioner’s full defense.
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`The Board referenced IPR2013-00368, Amneal Pharmaceuticals, LLC v.
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`Supernus Pharmaceuticals, Inc., in the conference call on August 25 as a case in
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`which a modified Protective Order was not entered. The highly confidential
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`materials identified in that case “contain[ed] clinical data that was submitted to
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`the Food and Drug Administration.” IPR2013-00368, Paper 34, p. 2.
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`The rationale for protecting highly confidential materials presented in this
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`case is distinguishable from the reasons set forth in Amneal. First, because the
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`nature of the highly confidential materials in Amneal related to technical clinical
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`data, it is more likely that the content of the material considered highly
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`confidential would be relevant to patentability. Thus, technical in-house
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`employees would have been more likely to be able to comment on the highly
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`confidential information and its relevance to non-obviousness. In contrast, in
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`this case, Patent Owner is presenting highly confidential financial information.
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`There is no impact on Petitioner’s in-house counsel’s ability to evaluate any
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`technical issues. Further, Petitioner’s in-house counsel will have access to the
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`aggregate financial data. This is the same information that will be presented to
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`the Board by Patent Owner and is the basis for Patent Owner’s arguments.
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`Patent No. 6,179,053
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`Second, in Amneal, the data deemed highly confidential had already been
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`submitted to FDA. In contrast, Patent Owner’s highly confidential financial
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`information has not been disseminated at all external to the company.
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`Finally, Patent Owner could suffer great prejudice if the modified
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`Protective Order is not entered. The Highly Confidential – Attorneys’ Eyes
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`Only – materials submitted will only be relevant if a cascading series of events
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`unfolds. That is, only if the claims of the ’053 Patent are found unpatentable
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`over the prior art, and then only if the Motion to Amend is granted, and then only
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`if the secondary considerations of non-obviousness are evaluated and then only
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`if the financial information (e.g., related to commercial success) is deemed
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`material to the determination, and then only if the underlying granular financial
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`information in the spreadsheets is somehow also deemed relevant, would the
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`Attorneys’ Eyes Only spreadsheets be implicated as potentially becoming public.
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`Without entry of the modified Protective Order and sealing of the materials,
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`there is a high probability that Patent Owner’s highly confidential financial
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`information will have been disclosed to in-house counsel of a direct competitor
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`with which Patent Owner is currently embroiled in litigation – when that level of
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`detailed information was not even considered in the final decision.
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`In another IPR decision (IPR2013-00167, Athena Automation Ltd. v.
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`Husky Injection Molding Systems Ltd., Paper 32), the Board entered a disputed
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`modified Protective Order which created an Attorneys’ Eyes Only category for
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`“competitively sensitive confidential information.” Id. at 3-4.
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`While Patent Owner understands and accepts that its confidential Category
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`1 financial information may become public if it is relied upon by the Board in its
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`final decision, the conditions of it becoming public are narrow and contingent.
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`And this contingency should not apply to the Category 2 Highly Confidential –
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`Attorneys’ Eyes Only – material that serves only as the foundational support for
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`the summary information relied on by Patent Owner. While these conditions are
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`possible, the prejudice to Patent Owner for the disclosure of its confidential
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`financial information to a competitor absent these conditions would be high.
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`Because counsel for Petitioner can present a complete and full defense
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`even if Patent Owner’s highly sensitive confidential financial information is
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`deemed “Attorneys’ Eyes Only,” and because the confidential financial
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`information may only end up being contingently relied upon by the Board, good
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`cause exits for entry of the Modified Protective Order. Entry of its Modified
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`Protective Order would help achieve “a balance between the public’s interest in
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`maintaining a complete and understandable file history and the parties’ interest
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`in protecting truly sensitive information.”
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`Patent No. 6,179,053
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`II. CERTIFICATION OF NON-PUBLICATION
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`On behalf of Patent Owner, undersigned counsel certifies the information
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`identified in the exhibits and sought to be sealed has not, to their knowledge,
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`been published or otherwise made public. As mentioned in the conference call
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`with the Board, the highly sensitive confidential financial information presented
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`by Patent Owner in conjunction with its Motion to Amend is not information that
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`would appear in public SEC filings.
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`III. CERTIFICATION OF CONFERENCE WITH OPPOSING
`PARTY PURSUANT TO 37 C.F.R. § 42.54
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`Patent Owner has in good faith conferred with Petitioner but has been
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`unable to reach an agreement with Petitioner regarding the modified Protective
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`Order. Petitioner does not agree with the scope and content of the Protective
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`Order and has represented that it opposes this motion for a Protective Order.
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`IV. PROPOSED PROTECTIVE ORDER
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`Pursuant to the Board’s authorization, Patent Owner respectfully requests
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`entry of the attached Protective Order in place of the Default Protective Order.
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`A clean copy of Patent Owner’s proposed protective order is attached as Exhibit
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`2032. Patent Owner submits as Exhibit 2033 a redlined version of Patent
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`Patent No. 6,179,053
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`Owner’s proposed protective order, which shows changes from the default
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`protective order.
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`As illustrated in the redlined version, Patent Owner’s proposed Modified
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`Protective Order is substantially similar to the Default Protective Order. In
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`particular, there are only two substantive changes from the Default Protective
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`Order. First, paragraph two has been amended to specify that confidential
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`information is to be marked “PROTECTIVE ORDER MATERIAL.” Good
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`cause exists for this amendment because it provides necessary clarity regarding
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`who may receive confidential material as a part of this proceeding.
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`Second, paragraph three has been added to allow for certain highly
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`sensitive confidential information to be marked “PROTECTIVE ORDER
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`MATERIAL – ATTORNEYS’ EYES ONLY.” Information with this
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`designation may only be disclosed to outside counsel, retained experts, the
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`Office and Support Personnel. Good cause exists for this amendment because it
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`will allow for extremely sensitive confidential information to be submitted to the
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`Board without harming either a party’s competitive position or the ability for any
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`party to raise a claim or defense.
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`Upon entry of the Protective Order, Patent Owner designates EX 2018 and
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`Paper 21 “CONFIDENTIAL.” Upon entry of the Protective Order, Patent Owner
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`Patent No. 6,179,053
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`designates EX 2024, EX 2025, EX 2026, and EX 2027 “PROTECTIVE ORDER
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`MATERIAL – ATTORNEYS’ EYES ONLY.”
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`V. CONCLUSION
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`Accordingly, Patent Owner requests that the Protective Order attached as
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`Ex. 2032 be entered in this case and the Category 1 Materials identified above be
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`sealed pursuant to paragraph 2 of the Protective Order and the Category 2
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`Materials identified above be sealed as Attorneys’ Eyes Only.
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`Dated: August 27, 2014
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`Respectfully submitted,
`
`/C. Erik Hawes /
`C. Erik Hawes
`Registration No. 63,328
`ehawes@morganlewis.com
`MORGAN, LEWIS & BOCKIUS LLP
`1000 Louisiana Street, Suite 4000
`Houston, Texas 77002
`T. 713.890.5165
`F. 713.890.5001
`
`Counsel for Patent Owner
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`Case IPR2014-00216
`Patent No. 6,179,053
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`CERTIFICATE OF SERVICE
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`The undersigned certifies that a true and correct copy of the Patent
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`Owner’s Combined Motion to Seal and Motion for Protective Order together
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`with all exhibits have been electronically served on the Petitioner’s attorneys
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`via email, as previously agreed by all counsel of record, on the 27th day of
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`August, 2014 at the following addresses:
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`John J. Feldhaus
`jfeldhaus@foley.com
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`Andrew R. Cheslock
`acheslock@foley.com
`
`Respectfully submitted,
`
` / C. Erik Hawes /
`C. Erik Hawes
`Registration No. 63,328
`Counsel for Patent Owner
`
`