IN THE UNITED STATES PATENT AND TRADEMARK OFFICE
`
`PETITION FOR INTER PARTES REVIEW OF U.S. PAT. NO. 8,459,346
`
`
`Mail Stop PATENT BOARD
`Patent Trial and Appeal Board
`United States Patent and Trademark Office
`PO Box 1450
`Alexandria, Virginia 22313–1450
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`
`
`
`
`
`
`Petition for Inter Partes Review
`
`Attorney Docket No.: 2700032-00005
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`Customer No.:
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`24573
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`§§§§§§§§§§§§§
`
`
`
`
`In re U.S. Patent No. 8,459,346
`
`Issued: June 11, 2013
`
`Name of Patentee: W. Lynn Frazier
`
`Patent Owner: Magnum Oil Tools
`International Ltd.
`
`
`Petitioner: McClinton Energy Group
`L.L.C.
`
`Title: BOTTOM SET
`
`DOWNHOLE PLUG
`
`
`
`
`

`

`Petition for Inter Partes Review of U.S. 8,459,346
`
`TABLE OF CONTENTS
`
`Introduction ...................................................................................................... 1
`
`Fee .................................................................................................................... 1
`
`
`
`I.
`
`II.
`
`III. Mandatory Notices ........................................................................................... 1
`
`A.
`
`B.
`
`C.
`
`D.
`
`Real Party-in-Interest ............................................................................ 1
`
`Standing ................................................................................................. 1
`
`Related matters ...................................................................................... 1
`
`Lead and Back-up Counsel and Service Information ........................... 2
`
`IV. Grounds for Standing ....................................................................................... 2
`
`V.
`
`Relief Requested .............................................................................................. 3
`
`VI. Reasons for the Requested Relief .................................................................... 3
`
`A.
`
`Summary of ‘346 Petition ..................................................................... 3
`
`1.
`
`Background of Technology ......................................................... 3
`a.
`Overview of Fracking ....................................................... 4
`b. Well Known Prior Art Plug Configuration ...................... 4
`c. Well Known Prior Art Method For Setting Plugs ............ 6
`d. Well Known And Interchangeable Prior Art Shearable
`Release Elements .............................................................. 7
`e. Well Known Prior Art Method For Flow Control ............ 9
`f. Well Known Prior Art Anti-Rotation Features .............. 10
`g. Well Known Prior Art Composite Materials .................. 11
`Summary of The ‘346 Patent .................................................... 12
`a.
`The ‘413 Patent IPR ....................................................... 12
`b.
`Claim Construction ......................................................... 14
`Prior Art ............................................................................................... 16
`
`2.
`
`Identification of Challenges ................................................................ 17
`
`–ii–
`
`B.
`
`C.
`
`
`
`

`

`1.
`
`2.
`
`
`
`
`
`Petition for Inter Partes Review of U.S. 8,459,346
`
`b.
`c.
`
`d.
`
`e.
`
`f.
`
`g.
`
`h.
`
`i.
`
`j.
`
`Claims 1-38 are anticipated or obvious in view of the teachings
`of Lehr as a base reference ........................................................ 18
`a.
`CHALLENGE #1: Claims 1-3, 5-21, 23-35, 37-38 are
`anticipated by Lehr ......................................................... 18
`CHALLENGE #2: Claims 1-38 are obvious over Lehr . 28
`CHALLENGE #3: Claims 1-38 are obvious over Lehr in
`view of Slup .................................................................... 31
`CHALLENGE #4: Claims 1-38 are obvious over Lehr in
`view of Cockrell ............................................................. 33
`CHALLENGE #5: Claims 1-38 are obvious over Lehr in
`view of Cockrell and Slup .............................................. 34
`CHALLENGE #6: Claims 16, 17, 21-24, 33, 34, 36, 37
`are obvious over Lehr in view of Kristiansen ................ 34
`CHALLENGE #7: Claims 1-38 are obvious over Lehr in
`view of Cockrell and Kristiansen ................................... 36
`CHALLENGE #8: Claims 1-38 are obvious over Lehr in
`view of Cockrell, Kristiansen and Slup .......................... 37
`CHALLENGE #9: Claim 4 is obvious over Lehr in view
`of Cockrell, Slup and McKeachnie ................................ 37
`CHALLENGE #10: Claims 21, 22, 36, 37 are obvious
`over Lehr in view of Cockrell, Slup, Kristiansen and
`Streich ............................................................................. 38
`Claims 1-38 are obvious in view of the teachings of Alpha as a
`base reference ............................................................................ 39
`a.
`CHALLENGE #11: Claims 1-38 are obvious over Alpha
`in view of the well-known prior art ................................ 39
`CHALLENGE #12: Claims 1-38 are obvious over Alpha
`in view of Cockrell and Slup .......................................... 45
`CHALLENGE #13: Claims 16, 17, 21-24, 33, 34, 36, 37
`are obvious over Alpha in view of Slup, Cockrell and
`Kristiansen ...................................................................... 46
`CHALLENGE #14: Claims 21, 22, 36, 37 are obvious
`over Alpha in view of Slup, Cockrell, Kristiansen and
`Streich ............................................................................. 48
`
`b.
`
`c.
`
`d.
`
`–iii–
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`

`

`
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`Petition for Inter Partes Review of U.S. 8,459,346
`
`e.
`
`3.
`
`CHALLENGE #15: Claim 4 is obvious over Alpha in
`view of Cockrell, Slup and McKeachnie ........................ 49
`Claims 1-38 are obvious in view of the teachings of Kristiansen
`as a base reference ..................................................................... 49
`a.
`CHALLENGE #16: Claims 1-38 are obvious over
`Kristiansen in view of Cockrell and Slup ....................... 49
`CHALLENGE #17: Claim 4 is obvious over Kristiansen
`in view of Cockrell, Slup and McKeachnie .................... 59
`CHALLENGE #18: Claims 21, 22, 36, 37 are obvious
`over Kristiansen in view of Cockrell, Slup and Streich . 59
`VII. Conclusion ..................................................................................................... 60
`
`b.
`
`c.
`
`
`
`
`
`
`
`–iv–
`
`

`

`
`
`Petition for Inter Partes Review of U.S. 8,459,346
`
`TABLE OF AUTHORITIES
`
`CASES
`
`KSR Int’l Co. v. Teleflex, Inc.,
`550 U.S. 398 ....................................................................................................... 28
`
`Motorola Mobility LLC v. Arnouse,
`IPR2013-00010, Paper No. 20 (January 30, 2013) ............................................... 3
`
`Sciele Pharma, Inc. v. Lupin Ltd.,
`684 F.3d 1253 (Fed. Cir. 2012) .......................................................................... 28
`
`STATUTES
`
`35 U.S.C. § 102 .................................................................................................... 3, 16
`
`35 U.S.C. § 103 .............................................................................................. 3, 28, 30
`
`OTHER AUTHORITIES
`
`37 C.F.R. §§ 42.15 and 42.103 .................................................................................. 1
`
`37 C.F.R. § 42.100(b) .............................................................................................. 14
`
`
`
`
`
`
`
`–v–
`
`

`

`Exhibit
`Number
`
`1001
`
`1002
`
`1003
`
`1004
`
`1005
`
`1006
`
`1007
`
`1008
`
`1009
`
`1010
`
`1011
`
`1012
`
`1013
`
`1014
`
`1015
`
`1016
`
`1017
`
`1018
`
`
`
`
`
`Petition for Inter Partes Review of U.S. 8,459,346
`
`TABLE OF EXHIBITS
`
`Description
`
`Referred To As
`
`U.S. Patent No. 8,459,346
`
`File History for U.S. Patent No. 8,459,346
`
`U.S. Patent No. 8,079,413
`
`District Court’s Markman Order for ‘346 Patent
`terms
`
`U.S. Patent No. 6,796,376
`
`U.S. Patent Application Publication No.
`2007/0151722 to Lehr et al.
`
`Alpha Oil Tools Catalog
`
`Alpha instructions for wireline equipment
`
`Alpha Standard Frac Plug
`
`Alpha Model “A” Ball Check Cement Retainer
`
`U.S. Patent No. 4,595,052
`
`U.S. Patent No. 4,437,516
`
`U.S. Patent No. 6,708,768
`
`U.S. Patent No. 7,350,582
`
`U.S. Patent No. 5,224,540
`
`U.S. Patent No. 3,094,166
`
`U.S. Patent No. 3,473,609
`
`U.S. Patent No. 7,185,700
`
`–vi–
`
`‘346 Patent
`
`Ex. 1002
`
`‘413 Patent
`
`Ex. 1004
`
`‘376 Patent
`
`Lehr
`
`Alpha
`
`Ex. 1008
`
`Ex. 1009
`
`Ex. 1010
`
`Kristiansen
`
`Cockrell
`
`Slup
`
`McKeachnie
`
`Streich
`
`McCullough
`
`Allen
`
`Collins
`
`

`

`1019
`
`1020
`
`1021
`
`1022
`
`1023
`
`1024
`
`1025
`
`1026
`
`1027
`
`
`
`
`
`Petition for Inter Partes Review of U.S. 8,459,346
`
`U.S. Patent No. 7,021,389
`
`U.S. Patent No. 2,714,932
`
`U.S. Patent No. 6,902,006
`
`U.S. Patent No. 7,428,922
`
`U.S. Patent No. 7,762,323
`
`MEA Winners: Remediation, Individual
`Equipment: Python Composite Bridge Plug, Harts
`E&P (April 2003)
`
`Baker Hughes youtube video of fracking process
`(http://www.youtube.com/watch?v=oPgZnZqp87k)
`(filed non-electronically due to size—Petitioner
`will file a motion to accord a filing date per 37
`C.F.R. § 42.6)
`
`Bishop
`
`Thompson
`
`Myerley
`
`Fripp
`
`‘323 Patent
`
`Ex. 1024
`
`Ex. 1025
`
`Declaration of Dr. Gary Wooley
`
`Examiner’s Comment from Notice of Allowability
`in Prosecution History of ‘413 Patent
`
`
`Wooley
`
`Ex. 1027
`
`–vii–
`
`

`

`
`
`I.
`
`Introduction
`
`Petition for Inter Partes Review of U.S. 8,459,346
`
`Petitioner requests review of claims 1 through 38 of U.S. Patent No.
`
`8,459,346 (“‘346 Patent”) (Ex. 1001). According to USPTO records, the ‘346
`
`Patent is assigned to Magnum Oil Tools International Ltd.
`
`II.
`
`Fee
`
`The required fee for this petition has been paid from Deposit Account No.
`
`02-1818, and the Office is authorized to deduct any fees necessary for this petition.
`
`III. Mandatory Notices
`A. Real Party-in-Interest
`The parties in interest for Petitioner are the McClinton Energy Group LLC,
`
`Jaycar Energy Group LLC, Surf Frac Wellhead Equipment Co., Motor Mills
`
`Snubbing LLC, Stan Keeling and Tony D. McClinton.
`
`Standing
`
`B.
`Petitioner certifies that the ‘346 Patent, issued on June 11, 2013, is available
`
`for inter partes review and that Petitioner is not barred or estopped from requesting
`
`an inter partes review challenging the claims of the ‘346 Patent.
`
`C. Related matters
`The ‘346 Patent was asserted against the parties-in-interest in Magnum Oil
`
`Tools Int’l LLC v. Tony D. McClinton et al., No. 2:13-cv-00163 (S.D. Tex.), which
`
`was consolidated into Case No. 2:12-cv-00099 (S.D. Tex) involving the same
`
`parties. The ‘346 Patent is a continuation of Application No. 13/194,871, filed on
`
`
`
`–1–
`
`

`

`
`
`Petition for Inter Partes Review of U.S. 8,459,346
`
`Jul. 29, 2011, now U.S. Patent No. 8,079,413 (“‘413 Patent”), which is a
`
`continuation-in-part of Application No. 12/317,497, filed on Dec. 23, 2008, now
`
`U.S. Patent No. 8,496,052. The ‘413 Patent is the subject of an instituted Inter
`
`Partes Review, IPR2013-00231.
`
`D. Lead and Back-up Counsel and Service Information
`Lead Counsel
`
`Jason A. Engel
`Phone: 312-807-4236
`K&L Gates LLP
`Fax: 312-827-8145
`70 W. Madison, Suite 3100
`jason.engel@klgates.com
`Chicago, Illinois 60602
`USPTO Reg. No. 51,654
`
`
`Phone: 312-807-4233
`Fax: 312-827-8145
`robert.barz@klgates.com
`
`Back-up Counsel
`Robert Barz (pro hac vice)
`K&L Gates LLP
`70 W. Madison, Suite 3100
`Chicago, Illinois 60602
`
`
`Petitioner hereby requests authorization to file a motion for Robert Barz to appear
`
`pro hac vice, as Mr. Barz is an experienced litigating attorney, and is counsel for
`
`McClinton Energy Group in the above-referenced litigation and as such has an
`
`established familiarity with the subject matter at issue in this proceeding.
`
`Petitioner intends to file such a motion once authorization is granted.
`
`IV. Grounds for Standing
`Petitioner certifies that it is not estopped or barred from requesting inter
`
`partes review of the ‘346 Patent. Service of a complaint asserting infringement of
`
`the ‘346 Patent against Petitioner and the other parties-in-interest was perfected on
`
`
`
`–2–
`
`

`

`
`
`Petition for Inter Partes Review of U.S. 8,459,346
`
`June 20, 2013 when Patent Owner filed Petitioner’s waiver of service, which was
`
`less than one year before this Petition. Motorola Mobility LLC v. Arnouse,
`
`IPR2013-00010, Paper No. 20 (January 30, 2013) (citing Fed. R. Civ. P. 4(d)(4)).
`
`Petitioner has not initiated an action challenging the validity of any claim of the
`
`‘346 Patent and certifies that the ‘346 Patent is eligible for inter partes review.
`
`V. Relief Requested
`Petitioner asks that the Board review the accompanying prior art and
`
`analysis, institute a trial for Inter Partes Review of claims 1-38 of the ‘346 Patent,
`
`and cancel those claims as invalid under 35 U.S.C. § 102 or 35 U.S.C. § 103.
`
`VI. Reasons for the Requested Relief
`A.
`Summary of ‘346 Petition
`Claims 1-38 of the ‘346 Patent are anticipated by the prior art, or at best,
`
`cover nothing more than obvious combinations of well known downhole plugs
`
`and/or very well known features of such plugs.
`
`Background of Technology
`
`1.
`The ‘346 Patent describes a plug used in a wellbore during drilling for oil or
`
`natural gas. ‘346 Patent, Abstract; Declaration of Dr. Gary Wooley, Ex. 1026, ¶12
`
`(hereinafter, “Wooley”). For decades, drillers have used plugs within oil and
`
`natural gas wellbores. Wooley ¶12. Drillers have also used plugs during
`
`“fracking” processes. Id.
`
`
`
`–3–
`
`

`

`
`
`Petition for Inter Partes Review of U.S. 8,459,346
`
`a. Overview of Fracking
`The fracking process starts with a wellbore drilled deep into the earth to
`
`reach hydrocarbons trapped in shale formations. Wooley ¶13; Ex. 1025. 1 A
`
`“perforating” gun or other device is used to create small holes in the wellbore wall.
`
`Id. These holes are then exposed to high pressure hydraulics that create large
`
`fractures in the shale formations, thus unlocking the oil or natural gas trapped
`
`within. Id. To fracture a wellbore, drillers divide it into separate zones. Drillers
`
`fracture the bottom-most zone first, using the process described above. Wooley
`
`¶14. The driller next inserts a frac plug uphole of the fracked zone. Ex. 1025. A
`
`frac plug can stop fluid flow in one or both directions. Wooley ¶14. The plug
`
`ensures that the hydraulic pressure is applied to the unfracked zone and stops the
`
`pressure from reaching the previously-fracked zone. Id. The process of plugging
`
`and fracking continues until the entire production area of the wellbore is fracked.
`
`Wooley ¶15.
`
`b. Well Known Prior Art Plug Configuration
`Most plugs used in drilling have the same basic components that function in
`
`the same way. Wooley ¶18. The following annotated Figure 2 from the ‘346
`
`Patent highlights the standard components of a plug:
`
`
`1 The fracking process is described in detail in a 2010 video available at
`http://www.youtube.com/watch?v=oPgZnZqp87k and attached as Ex. 1025. This
`video is representative of the state of the art in 2007-2008. See Wooley ¶17.
`
`
`
`–4–
`
`

`

`
`
`Petition for Inter Partes Review of U.S. 8,459,346
`
`Slip (240)
`
`Insert (100) that
`interacts with
`that setting tool
`
`First end of Body
`(210) with anti-
`rotation feature (295)
`
`Conical
`member (230)
`
`Malleable
`element (250)
`
`Second end of Body
`(210) with anti-
`rotation feature (285)
`
`
`‘346 Patent, Fig. 2 (annotated). As shown above, the ‘346 plug has a body
`
`providing support for outer components, including “slips” (which keep the plug
`
`fixed in the wellbore), a malleable element (which expands to seal the wellbore),
`
`and a conical member. Id; see also Wooley ¶¶19-22. This arrangement was not
`
`invented by Frazier in 2008. Rather, it has been the standard, well known
`
`arrangement for decades. Wooley ¶¶19-22. For example, each of the following
`
`prior art plugs have the same basic plug elements as the ‘346 Patent, including a
`
`body having a first end [A] and a second end [E], at least one slip [B] disposed
`
`about the body, at least one conical element [C] disposed about the body, and at
`
`least one sealing/malleable element [D] disposed about the body:
`
`
`
`–5–
`
`

`

`
`
`Petition for Inter Partes Review of U.S. 8,459,346
`
`A B C D
`
`
`
`C B
`
`E
`
`A B C D
`
`
`
`C B
`
`E
`
`Alpha (1996)
`
`Lehr (2007)
`
`McKeachnie (2004)
`
`Frazier (2004)
`
`A B C D
`
`C B
`
`E
`
`Kristiansen (1986)
`
`Slup (2004)
`
`
`
`Wooley ¶22.
`
`c. Well Known Prior Art Method For Setting Plugs
`In the “setting” process for expanding a plug in the wellbore, a setting tool
`
`exerts a force against the outer, upper end of the plug in a downward direction,
`
`forcing the components to expand and engage the wellbore. ‘346 Patent at 9:3-54;
`
`
`
`–6–
`
`

`

`
`
`Petition for Inter Partes Review of U.S. 8,459,346
`
`Wooley ¶26. “Top-set plugs” connect to the setting tool near the top of the plug.
`
`Wooley ¶¶27-28. For “bottom-set” plugs, the setting tool enters through a
`
`passageway in the plug and connects to an insert near the bottom of the plug.
`
`Wooley ¶29. At least Lehr, Alpha, and Kristiansen all disclose plugs with
`
`“bottom-set” inserts that connect to a setting tool. Wooley ¶29.
`
`d. Well Known And
`Interchangeable Prior Art
`Shearable Release Elements
`
`In a typical plug, the opposing upward/downward forces that set the plug are
`
`sufficient to shear the setting tool free from the insert of the plug. ‘346 Patent at
`
`9:21-36; Ex. 1025; Wooley ¶30. Prior to the priority date of the ‘346 Patent, there
`
`were a variety of well known and interchangeable shearable release elements, e.g.,
`
`shearable threads, shear rings, shear studs, shear screws, shear pins. Wooley ¶¶31-
`
`32. Most prior art plugs disclose one or more of them. Wooley ¶32. The Patent
`
`Owner admitted during the prosecution of the ‘346 Patent that these various
`
`shearing mechanisms were known
`
`in
`
`the art and were known
`
`to be
`
`interchangeable. Wooley ¶¶23-25; Ex. 1002 at p. 61 (“At best, the combination of
`
`Baker, Slup, and McCullough suggests replacing the release mechanism (i.e., the
`
`shear stud 43) of Baker with the release mechanism (i.e., the release ring 57) of
`
`McCullough. This would have been a ‘simple substitution’”) (emphasis added).
`
`In the file history of the ‘413 Patent, the Patent Office recognized that
`
`interchangeability of these elements is obvious: “[I]t would have been considered
`
`
`
`–7–
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`

`

`
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`Petition for Inter Partes Review of U.S. 8,459,346
`
`obvious to replace the shear pin of Bonner with shearable threads, as this would
`
`have amounted to simple substitution of well-known equivalent shear release
`
`mechanisms.” Ex. 1027 at p. 7.
`
`The use of shearable threads on plug inserts has been well-known in the
`
`industry for at least fifty years. Wooley ¶34. For example, U.S. Patent No.
`
`3,094,166 (“McCullough”), which was filed in 1960, describes a plug that is
`
`connected to a setting tool by insert 57: “the shear threads 72 fail, thereby
`
`separating the [setting tool] from the packer device.” McCullough at 3:9-23, Fig.
`
`3; Wooley ¶34. Further, U.S. Patent No. 4,437,516 (“Cockrell”) very clearly
`
`teaches shearable threads for use in plug inserts. Cockrell at 5:43-47, Fig. 1c.
`
`The interchangeability of shearing mechanisms was also well-known for
`
`decades prior to the priority date of the ‘346 Patent. Wooley ¶¶36-41. For
`
`example, U.S. Patent No. 3,473,609 (“Allen”), discloses “[i]nsofar as the choice of
`
`a particular shearable member is concerned, the invention is not restricted to the
`
`use of a shear ring 21, and as desired one or more shear pins 37 such as are shown
`
`in FIG. 2, or shearable threads 38 as shown in FIG. 3 can be substituted.” Allen at
`
`4:33-37, Figs. 2, 3; Wooley ¶36. U.S. Patent No. 7,185,700 (“Collins”) states that
`
`any “form[] of shearable members may be employed in the release member 115, as
`
`long as they are capable of shearing at a predetermined force[, for] example, a
`
`threaded connection (not shown) may be employed.” Collins at 4:37-40; Wooley
`
`
`
`–8–
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`

`

`
`
`Petition for Inter Partes Review of U.S. 8,459,346
`
`¶¶36. The prior art also explicitly describes why to use shearable or deformable
`
`threads as a replacement for other shearing mechanisms.
`
` Wooley ¶41.
`
`Specifically, Lehr suggests that shearing or deforming mechanisms that leave
`
`unwanted chunks of debris in the hole after shearing may be avoided by using
`
`deformable components (like a shear ring or shearable threads) that leave little or
`
`no debris behind. Lehr, [0013].
`
`e. Well Known Prior Art Method For Flow Control
`Frequently, plugs have passageways that allow fluid flow. Wooley ¶42.
`
`These passages must be sealed before the application of hydraulic pressure. Id.
`
`This is typically done using a valve. Lehr at [0055]; Wooley ¶42. It was well
`
`known at the time of the invention of the ‘346 Patent that a valve for restricting
`
`fluid flow in at least one direction could be placed in the body of the plug or more
`
`specifically within (or as part of) the insert. Wooley ¶43. Two common valve
`
`types used in many prior art plugs are ball valves and flapper valves. Lehr at
`
`[0055]; Slup at 7:9-14; Wooley ¶¶44-46. The ‘346 Patent makes clear that these
`
`two types of valves are interchangeable. ‘346 Patent at 5:60-65, 10:3-43; Wooley
`
`¶44. Ball valves employ a ball that seats on or within the plug or insert, blocking
`
`flow in the downhole direction. Wooley ¶45. The ball prevents fluid above the
`
`plug from flowing through the plug, but allows fluid to flow upward through the
`
`
`
`–9–
`
`

`

`
`
`Petition for Inter Partes Review of U.S. 8,459,346
`
`plug. Id. This process is clearly described in Slup. Slup at 7:9-14. The Alpha
`
`Standard Frac Plug also discloses a ball valve:
`
`
`Alpha at p.6; Wooley ¶45. McKeachnie discloses ball valves and further discloses
`
`the well known concept that the ball(s) used in a ball valve may be decomposable
`
`at predetermined conditions. McKeachnie at 6:35-41, Fig. 2; Wooley ¶47. Other
`
`references, such as Lehr, specifically disclose flapper valves. Wooley ¶49. The
`
`well known prior also includes inserts that completely block a plug’s passageway.
`
`Id. For example, Kristiansen discloses various inserts, some that have valves and
`
`others that have blocked passageways completely preventing fluid flow through
`
`the plug. Kristiansen at 3:53-4:4; Wooley ¶49. These well known flow control
`
`mechanisms were employed for the same purpose in each of the prior art
`
`references, i.e., to restrict flow in at least the downhole direction to allow the
`
`uphole zone to be isolated and/or fracked. Wooley ¶49.
`
`f. Well Known Prior Art Anti-Rotation Features
`Drillers remove plugs by drilling through them to allow oil and gas to move
`
`towards the surface. Wooley ¶¶16, 51. During the drilling process, after the slips
`
`are drilled out, the remainder of the plug is set free from the casing and pushed
`
`downhole by the drill until it runs into the next plug. Wooley ¶52. The top end of
`
`
`
`–10–
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`Petition for Inter Partes Review of U.S. 8,459,346
`
`a downhole and the bottom end of an uphole plug may be configured in a
`
`complementary fashion so
`
`that
`
`the ends
`
`interlock.
`
` Wooley ¶53. Such
`
`complementary features are referred to as “anti-rotation” features. Wooley ¶54.
`
`The prior art is replete with specific configurations of anti-rotation features, but all
`
`of the varieties serve the same purpose: to prevent rotation of materials during the
`
`drill out process. Wooley ¶¶54-55. The Patentee’s own ‘376 Patent (issued 2004)
`
`discloses and claims a specific anti-rotation feature. ‘376 Patent at 3:22-26.
`
`Kristiansen, Slup, and Lehr also disclose a variety of anti-rotation features.
`
`Kristiansen 6:40-46, Fig. 1; Lehr, Fig. 4C; Slup, Fig. 24; Wooley ¶¶55-56.
`
`g. Well Known Prior Art Composite Materials
`The drill out time for a plug can be reduced based on the composition of the
`
`plug. Wooley ¶57. It was well known to manufacture plug components out of
`
`high strength, easily drillable materials such as composites. Slup at 9:42-49;
`
`Wooley ¶57. Even Frazier disclosed a composite plug prior to the to the priority
`
`date of the ‘346 Patent. U.S. Patent No. 7,762,323 (“‘323 Patent”) at 4:32-44.
`
`Slup similarly discloses a composite plug including a mandrel and other plug
`
`components made of composite material(s). Slup at 18:5-15, 49-62; Wooley ¶¶57,
`
`60. The industry, and those of skill in the art, were aware that composite mandrels
`
`would “slash[] mill out times.” Ex. 1024 at p. 108; Wooley ¶61. The particular
`
`
`
`–11–
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`

`

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`Petition for Inter Partes Review of U.S. 8,459,346
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`composite plug referenced in the 2003 MEA Winners article is the preferred
`
`embodiment of Lehr. Lehr at [0039].
`
`Summary of The ‘346 Patent
`
`2.
`The ‘346 Patent claims priority as a continuation-in-part of U.S. Patent App.
`
`No. 13/194,871, filed on July 29, 2011, now Pat. No. 8,079,413 (‘413 Patent),
`
`which is a continuation-in-part of U.S. Patent App. No. 12/317,497 (filed
`
`December 23, 2008) (“the ’497 application”). ‘346 Patent at [63]. The ‘346 Patent
`
`issued on June 11, 2013 with 38 claims (Claims 1, 18, and 32 are independent).
`
`a.
`The Board has instituted an IPR proceeding against the parent patent (‘413
`
`The ‘413 Patent IPR
`
`Patent) of the ‘346 Patent. IPR2013-00231, Paper 16 (Sept. 8, 2013). That
`
`Proceeding has concluded and the parties await a decision. During that proceeding
`
`the Patent Owner conceded that many elements common to the claims of the ‘413
`
`and ‘346 Patents are disclosed in the prior art. The Board, in its Institution
`
`Decision, found that every element of the ‘413 Patent is disclosed in the prior art.
`
`IPR2013-00231, Paper 16. A comparison of the claims from the two related
`
`patents reveals that the claimed elements are virtually identical.
`
`From ‘413 Patent, Claim 1
`‘346 Patent, Claim 1
`(IPR2013-00231)
`1. A plug for use in a wellbore,
`1. A plug for isolating a wellbore,
`comprising:
`comprising:
`a body having a first end and a second
`end, wherein the body is formed from a body having a first end and a second
`
`
`
`–12–
`
`

`

`Petition for Inter Partes Review of U.S. 8,459,346
`
`
`
`one or more composite materials;
`at least one malleable element disposed
`about the body;
`at least one slip disposed about the
`body;
`at least one conical member disposed
`about the body; and
`an insert at least partially disposed in the
`body proximate the second end of the
`body, the insert adapted to receive a
`setting tool that enters the body through
`the first end thereof, wherein:
`the
`insert comprises one or more
`shearable threads disposed on an inner
`surface thereof;
`the one or more shearable threads are
`disposed proximate the second end of
`the body and are adapted to engage the
`setting tool; and
`
`the one or more shearable threads are
`adapted to deform to release the setting
`tool when exposed to a predetermined
`axial force that is less than an axial force
`required to break the body.
`
`end;
`at least one malleable element disposed
`about the body;
`at least one slip disposed about the
`body;
`at least one conical member disposed
`about the body; and
`an insert screwed into an inner surface
`of the body proximate the second end
`of the body and adapted to receive a
`setting tool that enters the body through
`the first end thereof, wherein:
`the
`insert comprises one or more
`shearable threads disposed on an inner
`surface thereof;
`
`the one or more shearable threads are
`adapted to engage the setting tool; and
`
`the one or more shearable threads are
`adapted to deform to release the setting
`tool when exposed to a predetermined
`axial force, thereby providing a flow
`passage through the insert and the
`body.
`
`(Compare ‘346 Patent at Claim 1 with ‘413 Patent at Claim 1) (emphasis added).
`
`The Board’s decision in IPR2013-0023 was based largely on Lehr as a
`
`primary reference. IPR2013-00231, Paper 16. The Board agreed that Petitioner
`
`demonstrated a reasonable likelihood of prevailing on its assertions regarding the
`
`unpatentability of Claims1-20 of the ‘413 Patent. Id. at pp. 25-26. Upon review,
`
`the board concluded that Petitioner’s suggestions for combining the teachings of
`
`
`
`–13–
`
`

`

`
`
`Petition for Inter Partes Review of U.S. 8,459,346
`
`Lehr (for the basic plug components), Cockrell (for shearable threads) and
`
`Kristiansen (threads on the outer surface of the insert) each suffice as an articulated
`
`reason with rational underpinning to justify the legal conclusion of invalidity. Id.
`
`at 24. The Board also agreed that an additional element requiring that the body of
`
`the plug is made of composite materials (reflected in Claim 10 of the ‘413 Patent)
`
`was likely unpatentable based on a combination of Lehr, Cockrell, Kristiansen and
`
`Slup. Id. at 25. As with the ‘413 Patent, during the prosecution of the ‘346
`
`Patent, Lehr was not used by the Examiner as a basis for rejection. As the Board
`
`found with respect to the ‘413 Patent and given the similarities noted above, Lehr
`
`in combination with the well known prior art and/or other prior art references
`
`raises a substantial new question of patentability of every claim of the ‘346 Patent.
`
`b.
`In the pending district court litigation, the parties agreed to constructions for
`
`Claim Construction
`
`some terms in the ‘346 Patent. In an inter partes review, claim terms are given
`
`their “broadest reasonable construction.” See 37 C.F.R. § 42.100(b). Where not
`
`specified, the claim terms are construed according to their ordinary and customary
`
`meaning. Some of the agreed-to terms are reproduced below.
`
`Claim Term
`…body…
`
`…first end…
`
`
`
`Agreed Construction
`A centralized support member, made of one
`or more components or parts, for one or
`more outer components
`to be disposed
`thereon or thereabout.
`Upper end
`
`–14–
`
`

`

`
`
`…second end…
`…shearable threads…
`
`…setting tool…
`
`
`Petition for Inter Partes Review of U.S. 8,459,346
`
`Lower end
`Spiral ridges that are designed to shear,
`fracture, break, or otherwise deform thereby
`releasing two or more engaged components,
`parts, or things.
`Any device used in the installation process of
`the plug within the wellbore, and includes
`any outer cylinder, adapter rod, and/or
`extender.
`
`(See Ex. 1004). The following constructions were disputed:
`
`Term
`mandrel
`
`
`
`shoe
`
`
`Patent Owner’s Construction
`A cylindrical bar, spindle, or shaft
`that acts as a centralized support
`member, around which outer
`components are positioned about
`or attached thereto.
`A component, separate from the
`body, that is attached to the body
`at the second end.
`
`Petitioner’s Construction
`Centralized
`support member,
`around which outer components
`are positioned about or attached
`thereto.
`
`A distinct portion of the body that
`begins at the lower end of the
`body and extends at least partially
`toward the upper end of the body.
`
`(Id.) Regarding “mandrel,” Petitioner’s construction does not unnecessarily and
`
`improperly limit “mandrel” to “[a] cylindrical bar, spindle, or shaft.” The ‘346
`
`Patent does not limit “mandrel” to a “cylindrical” configuration. Regardless of the
`
`construction applied, the analysis below regarding “mandrel” remains the same.
`
`Thus, in the Petition, Petitioner applies Patent Owner’s more narrow construction
`
`to the prior art. Regarding “shoe,” Petitioner requests a broad construction that
`
`encompasses both proposed constructions: A component, separate from the body
`
`or part of the body, located at the second end of the body. As with “mandrel,”
`
`regardless of the construction applied, the analysis below remains the same.
`
`
`
`–15–
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`

`

`
`
`Petition for Inter Partes Review of U.S. 8,459,346
`
`Prior Art
`
`B.
`As noted above, the ‘346 Patent claims priority to the ‘497 application. ‘346
`
`Patent at [63]. For the purposes of this petition, we assume that the priority date of
`
`the ‘346 Patent is December 23, 2008, the filing date of the ‘497 Application. The
`
`challenges in this Petition rely on several prior art patents and publications. These
`
`references qualify as prior art as set forth below:
`
`U.S. Patent Application Pub. No. 2007/0151722 to Lehr et al. (“Lehr”),
`
`Exhibit 1006, published on July 5, 2007. Lehr is prior art under § 102(b). 2
`
`The Alpha Oil Tools Catalog (“Alpha”), Exhibit 1007, is a catalog dated
`
`1996/1997. Alpha qualifies as prior art to the ’413 patent under § 102(b).
`
`U.S. Patent No. 4,595,052 to Kristiansen, Exhibit 1011, issued on June 16,
`
`1986. Kristiansen qualifies as prior art under 35 U.S.C. § 102(b).
`
`U.S