`
`
`
`
`Paper No. 65
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`______________
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`BAKER HUGHES, A GE COMPANY, LLC
`and
`BAKER HUGHES OILFIELD OPERATIONS LLC
`Petitioners
`
`v.
`
`PACKERS PLUS ENERGY SERVICES, INC.
`Patent Owner
`
`______________
`
`Case IPR2016-01496
`Patent 7,134,505
`______________
`
`
`PETITIONERS’ REPLY
`
`
`28539603.2
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`

`Petitioners’ Exhibit List
`
`Case IPR2016-01496
`Patent 7,134,505
`
`Description
`Exhibit
`1001 U.S. Patent No. 7,134,505 (the “’505 Patent”)
`1002 Affidavit of Margaret Kieckhefer, of the Library of Congress,
`regarding excerpts from COMPOSITE CATALOG OF OIL FIELD AND PIPE
`LINE EQUIPMENT, Vol. 2 (21st ed. World Oil 1955) (“Lane-Wells”)
`1003 U.S. Patent No. 5,449,039 (“Hartley”)
`1004 B. Ellsworth, et al., Production Control of Horizontal Wells in a
`Carbonate Reef Structure, 1999 Canadian Institute of Mining,
`Metallurgy, and Petroleum Horizontal Well Conference (“Ellsworth”)
`1005 U.S. Patent No. 5,375,662 (“Echols”)
`1006 U.S. Patent 4,018,272 (“Brown”)
`1007 Declaration of Ali Daneshy, Ph.D. (“Daneshy1”)
`1008 KATE VAN DYKE, FUNDAMENTALS OF PETROLEUM ENGINEERING (4th
`ed. 1997)
`1009 RON BAKER, A PRIMER OF OIL WELL DRILLING (5th ed. (revised) 1996)
`1010 U.S. Patent No. 4,099,563 (“Hutchison”)
`1011 U.S. Patent No. 6,257,338
`1012
`Excerpts of Prosecution History of U.S. Patent No. 7,861,774, a
`continuation of the ’505 Patent
`Excerpts of Prosecution History of the ’505 Patent
`1013
`1014 U.S. Provisional Application No. 60/404,783
`1015 Dictionary Definition from WEBSTER’S THIRD NEW INTERNATIONAL
`DICTIONARY OF THE ENGLISH LANGUAGE UNABRIDGED (1986)
`1016 U.S. Patent No. 4,279,306
`1017 K.W. Lagrone, et al., A New Development in Completion Methods,
`SOCIETY OF PETROLEUM ENGINEERING, Paper 530-PA (1963)
`1018 M.J. Eberhard, et al., Current Use of Limited-Entry Hydraulic
`Fracturing in the Codell/Niobrara Formations—DJ Basin, SPE
`(Society for Petroleum Engineering) 29553 (1995)
`
`28539603.2
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`

`Case IPR2016-01496
`Patent 7,134,505
`
`Description
`Exhibit
`1019 Declaration of Christopher D. Hawkes, Ph.D., P.Geo., regarding the
`proceedings of the 7th One-Day Conference On Horizontal Well
`Technology Operational Excellence (Canada November 3, 1999)
`(including Ex. 1004 at 102-110)
`1020 Affidavit of Nancy Chaffin Hunter regarding the proceedings of the
`10th Middle East Oil Show & Conference (Bahrain March 15-18,
`1997) (including D.W. Thomson, et al., Design and Installation of a
`Cost-Effective Completion System for Horizontal Chalk Wells Where
`Multiple Zones Require Acid Stimulation, SPE (Society for Petroleum
`Engineering) 37482 (1997)) (“Thomson”)
`1021 Affidavit of Nancy Chaffin Hunter, regarding the proceedings of the
`Production Operation Symposium (Oklahoma City, OK April 2-4,
`1995) (including R. Coon and D. Murray, Single-Trip Completion
`Concept Replaces Multiple Packers and Sliding Sleeves in Selective
`Multi-Zone Production and Stimulation Operations, SPE 29539
`(1995)) (“Coon”)
`1022 Howard, G. C. & Fast, C. R., HYDRAULIC FRACTURING
`(AIMMPE 1970)
`1023 Hyne, Norman J., Dictionary of Petroleum Exploration, Drilling, &
`Production (1991)
`11241 Affidavit of Velma J’Nette Davis-Nichols, regarding Lane-Wells (see
`Ex. 1002) (including Lane-Wells at Appendix A)
`1125 Affidavit of Debbie Caples, regarding Ex. 1008 and Ex. 1009
`(including Ex. 1008 at Appendix B and Ex. 1009 at Appendix D) –
`NOT FILED
`1126 Affidavit of Rodolfo Diaz, regarding Ex. 1017 (including Ex. 1017 at
`Appendix A and related materials at Appendix B) – NOT FILED
`1127 Declaration of Rebekah Stacha, regarding Ex. 1018 (including Ex.
`1018 at Exhibit A) – NOT FILED
`1128 Affidavit of Troy Price, regarding Ex. 1022 (including Ex. 1022 at
`Appendix A) – NOT FILED
`1129 Affidavit of Troy Price, regarding Ex. 1023 (including Ex. 1023 at
`Appendix A) – NOT FILED
`Table Associated with qrySumNetValuebyFamily from Ex. 2051
`(contains PROTECTIVE ORDER MATERIAL)
`
`1130
`
`
`1 Exs. 1024 et seq. have been renumbered 1124 et seq. for clarity, given joinder.
`28539603.2
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`

`Case IPR2016-01496
`Patent 7,134,505
`
`Description
`Exhibit
`1131 March 1, 2017 email from Justin Nemunaitis, confirming RE Packer
`revenue in Ex. 1130 was included in revenue figure reported at Ex.
`2050 at 42:9.
`1132 UNREDACTED Transcript of July 27, 2017 Deposition Testimony of
`Harold R. McGowen III (“McGowen2”) (contains PROTECTIVE
`ORDER MATERIAL)
`1133 REDACTED Transcript of July 27, 2017 Deposition Testimony of
`Harold R. McGowen III (“McGowen2”)
`Transcript of February 28, 2017 Deposition Testimony of Harold R.
`McGowen III (“McGowen1”)
`
`1134
`
`
`
`
`
`
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`

`Case IPR2016-01496
`Patent 7,134,505
`
`Table of Contents
`
`THE EVIDENCE OF OBVIOUSNESS IS STRONG .................................... 1 
`I. 
`STRONG MOTIVATIONS TO USE ELLSWORTH (POR 39-43) .............. 1 
`II. 
`III.  RC MISCHARACTERIZES POSITA’S VIEWS (POR AT 7-13) ................ 4 
`A. 
`Cemented Casing: Not A Requirement ................................................ 4 
`IV.  RC’S SECONDARY CONSIDERATIONS ARE TOO WEAK TO
`OVERCOME OBVIOUSNESS (POR 6-30) .................................................. 5 
`The Claimed Methods Did Not Contravene Accepted Wisdom
`A. 
`(POR at 7-13) ........................................................................................ 5 
`RC Has Not Established Nexus (POR at 28-30) ................................... 6 
`B. 
`RC’s Industry Praise Lacks Nexus (POR 13-18) ................................ 10 
`C. 
`RC’s Commercial Success Lacks a Nexus (POR 24-27) .................... 12 
`D. 
`RC’s Copying Evidence Is Meritless (POR 18-23) ............................ 15 
`E. 
`Length of Intervening Time (POR 30) ................................................ 16 
`F. 
`RC’S “PRINTED PUBLICATION” ARGUMENTS ARE
`MERITLESS .................................................................................................. 17 
`VI.  SBP SHOULD BE DEFINED ....................................................................... 18 
`
`
`
`V. 
`
`
`
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`

`Table of Authorities
`
`Case IPR2016-01496
`Patent 7,134,505
`
` Page(s)
`
`Cases
`Amazon.com, Inc. v. Barnesandnoble.com, Inc.,
`239 F.3d 1343 (Fed. Cir. 2001) ............................................................................ 2
`Apple Inc. v. Samsung Elecs. Co.,
`816 F.3d 788 (Fed. Cir. 2016) ............................................................................ 17
`Cable Electric Products, Inc. v. Genmark, Inc.,
`770 F.2d 1015 (Fed. Cir. 1985) .......................................................................... 14
`CaptionCall, L.L.C. v. Ultratec, Inc.,
`IPR2015-00637 (Paper 98) (P.T.A.B. Sep, 7, 2016) ............................................ 7
`Classco, Inc. v. Apple, Inc.,
`838 F.3d 1214 (Fed. Cir. 2016) ................................................................ 9, 10, 11
`Dunnhumby USA, LLC v. Emnos USA Corp.,
`No. 13-CV-0399, 2015 WL 1542365 (N.D. Ill. Apr. 1, 2015) ........................... 18
`Ecolochem, Inc. v. S. Cal. Edison Co.,
`227 F.3d 1361 (Fed. Cir. 2000) .......................................................................... 16
`Instradent USA, Inc. v. Nobel Biocare Services AG,
`IPR2015-01786 (Paper 106) (P.T.A.B. Feb. 15, 2017) ...................................... 17
`Laird Techs., Inc. v. GrafTech Int’l Holdings, Inc.,
`IPR2014-00024 (Paper 46) (P.T.A.B. Mar. 25, 2015) ................................. 13, 14
`Leo Pharm. Prod., Ltd. v. Rea,
`726 F.3d 1346 (Fed. Cir. 2013) .......................................................................... 16
`LG Chem, Ltd. v. Celgard, LLC,
`IPR2014-00692 (Paper 76) (P.T.A.B. Oct. 5, 2015) ............................................ 7
`LKQ Corp. v. Clearlamp, LLC,
`IPR2013-00020 (Paper 73) (P.T.A.B. Mar. 27, 2014) ....................................... 15
`In re Magnum Oil Tools Int’l, Ltd.,
`829 F.3d 1364 (Fed. Cir. 2016) ............................................................................ 4
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`Case IPR2016-01496
`Patent 7,134,505
`
`MotivePower, Inc. v. Cutsforth, Inc.,
`Case IPR2013-00274 (Paper 91) (P.T.A.B. Sep. 9, 2016) ................................. 17
`MPHJ Tech. Investments, LLC v. Ricoh Americas Corp.,
`847 F.3d 1363 (Fed. Cir. 2017) .................................................................... 18, 19
`Richdel, Inc. v. Sunspool Corp.,
`714 F.2d 1573 (Fed. Cir. 1983) .................................................................... 13, 14
`Rothman v. Target Corp.,
`556 F.3d 1310 (Fed. Cir. 2009) .......................................................................... 16
`W.L. Gore & Assoc., Inc. v. Garlock, Inc.,
`721 F.2d 1540 (Fed. Cir. 1983) ............................................................................ 6
`Wm. Wrigley Jr. Co. v. Cadbury Adams USA LLC,
`683 F.3d 1356 (Fed. Cir. 2012) .......................................................................... 16
`Rules and Statutes
`Rule 42.6(a)(3) ........................................................................................................... 7
`Rule 42.24 .................................................................................................................. 7
`Rule 42.65(a) ............................................................................................................ 15
`Rule 65(a) ................................................................................................................. 13
`Other Authorities
`77 Fed. Reg. 48,756, 48,763 .............................................................................. 13, 15
`
`
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`Case IPR2016-01496
`Patent 7,134,505
`
`I.
`
`THE EVIDENCE OF OBVIOUSNESS IS STRONG
`Rapid Completions LLC (“RC”) does not identify any differences between
`
`the Lane-Wells-Ellsworth system and the claimed system. Instead, stressing
`
`alleged secondary considerations, RC questions POSITA’s motivation to use
`
`Ellsworth’s particular solid body packers (SBPs) with Lane-Wells. RC fails to
`
`overcome Petitioners’ strong showing of obviousness.
`
`First, RC argues that a POSITA would not have used Ellsworth’s SBPs for
`
`acidizing because Ellsworth taught that its SBPs were successfully “held in place
`
`for over year,” whereas a “typical multi-stage acidizing job should take a matter of
`
`days.” POR 41-42. By this logic, a POSITA would never use a tool that could
`
`potentially exceed the minimal requirements of any given job. But that notion is
`
`undermined by RC’s own expert’s recognition that safety factors are commonplace
`
`with downhole tools. Moreover, Ellsworth itself used its SBPs for acidizing.
`
`Finally, RC’s alleged secondary considerations are grounded in sales or
`
`discussions of the system itself rather than its use in an open-hole, which is the only
`
`alleged difference over the prior art.
`
`II.
`
`STRONG MOTIVATIONS TO USE ELLSWORTH (POR 39-43)
`RC’s sole attempt to undermine a POSITA’s motivation to use Ellsworth’s
`
`SBPs with the Lane-Wells system to argue that a POSITA would not have used
`
`Ellsworth’s SBPs for acidizing because Ellsworth taught that its SBPs were
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`Case IPR2016-01496
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`successfully “held in place for over year,” whereas a “typical multi-stage acidizing
`
`job should take a matter of days.” POR 41-42. RC then sidesteps whether a
`
`POSITA actually would have done so and attempts recast the issue as one of
`
`Petitioners failing to meet their burden: “Petitioners offer no explanation as to why
`
`a POSITA would undertake the increased cost and risk of using solid body packers
`
`for that type of job.” POR at 42. But RC’s assertion rests solely on attorney
`
`argument; RC cites no evidence of any such cost or risk.
`
`The only evidence RC cites for its attacks on the combination of Lane-Wells
`
`and Ellsworth is a passage from McGowen in which he opines: “If the POSITA
`
`considered the Lane-Wells text at all, the POSITA would rely upon the
`
`conventions present at the time the information was published (circa 1955) to
`
`determine what type of packer the authors were thinking of using in the suggested
`
`application.” POR at 42 (citing Ex. 2081/2084 at § 8.1). That conception of
`
`obviousness was not the law in 1955, nor is it now. “The relevant inquiry is what a
`
`… [POSITA] would have gleaned from [Lane-Wells] at the time that the patent
`
`application leading to the [’505 Patent] was filed.” Amazon.com, Inc. v.
`
`Barnesandnoble.com, Inc., 239 F.3d 1343, 1364 (Fed. Cir. 2001); McGowen2,
`
`11:20-12:10, 148:19-24. That McGowen’s opinions rest on such a faulty premise
`
`is reason enough to ignore his conclusions.
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`RC attempts to conflate inherency, which depends on what is necessarily
`
`present in Lane-Wells, with Petitioners’ theory of obviousness, based on what a
`
`POSITA—in 2001—would have recognized in the collective evidence. The
`
`Petition explain that Lane-Wells does not specify a type of packer, and “a POSITA
`
`would have considered using packers in such a system that met the system’s
`
`minimum requirements—the capability to create multiple zones in an open hole
`
`and compatibility with acidizing—and that possessed characteristics relevant to the
`
`chosen completion (such as type of formation, orientation of wellbore, etc.).”
`
`Petition at 35 (citing Daneshy1 at ¶74).
`
`The Petition further explains why Ellsworth disclosed such a packer, and
`
`multiple reasons why a POSITA would have been motivated to use Ellsworth’s
`
`packer for acidizing in an open hole and have a reasonable expectation of success
`
`doing so. See Petition at 35-39 (citing, e.g., Daneshy1 at ¶¶43-46, 75-79; Ex. 1004
`
`(Ellsworth) at 3-9; Ex. 1020 (Thomson); Ex. 1006 (Brown)). For example,
`
`“Ellsworth’s solid body packer … had been used successfully for acidizing and
`
`isolating multiple zones in an open hole.” Petition at 36 (citing Ellsworth); see
`
`also Ellsworth at p. 3/FIG. 4, at 5 (“SBP’s were run to acidize the toe of the well.”)
`
`and at 6 (“The initial acid job using SBP’s indicated that the [SBPs] successfully
`
`provided isolation during the job.”). “Ellsworth’s SBP was therefore well-suited
`
`for use in the Lane-Wells System.” Petition at 36 (citing Daneshy1 at ¶75). And
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`Case IPR2016-01496
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`“[a] POSITA would have been comfortable using packers that had already been
`
`successfully used in this type of formation, because such a person would have
`
`viewed proven packers as having a greater likelihood of success than unproven
`
`packers and, therefore, a lower risk of failure.” Petition at 38 (citing Daneshy1 at
`
`¶77).
`
`The evidence therefore renders the cases RC cited on POR 40 inapposite.
`
`See, e.g., In re Magnum Oil Tools Int’l, Ltd., 829 F.3d 1364, 1380 (Fed. Cir. 2016)
`
`(“specific reasoning, based on evidence of record, to support the legal conclusion
`
`of obviousness”).
`
`III. RC MISCHARACTERIZES POSITA’S VIEWS (POR AT 7-13)
`A. Cemented Casing: Not A Requirement
`RC argues POSITA would have believed cemented casing was needed for
`
`proper fracture spacing. POR at 7-13. All of these arguments are irrelevant here
`
`because none of the Challenged Claims of the ’505 Patent require fracturing. Even
`
`if they did, RC’s arguments would fail. 2
`
`1. Only Claims 20 and 25 Requires Deliver of Treatment
`Fluid In Two Segments
`RC’s fracture spacing arguments depend upon RC’s assumption that
`
`multiple fractures must be achieved across different wellbore segments, or zones.
`
`See POR at 7 (quoting Ex. 2098 at 1) (“Casing and cementing the horizontal
`
`2 POR 7-13 cites no pre-invention evidence.
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`Case IPR2016-01496
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`section allows fracture initiation points to be controlled in placing multiple
`
`fractures.”). These arguments are irrelevant because none of the claims require
`
`fracturing at all. Even if they did, these arguments would be necessarily limited to
`
`claims 20 and 25, the only challenged claims reciting the delivery of treatment
`
`fluid to two wellbore segments. See Petition at 54, 57, 47-48 (claims 20 and 25,
`
`referencing claim elements 4[a][i] and 4[a][ii] for explanation of function).
`
`2. OHMS Acidizing Was Well Known
`RC’s arguments about the “accepted wisdom” about fracturing is also
`
`irrelevant because the claims do not require fracturing. Nor does RC argue that
`
`open-hole multi-stage (“OHMS”) acidizing was contrary to accepted wisdom.
`
`POR at 7-13. It was not. Lane-Wells itself disclosed: “The Tubing Port Valve
`
`also provides a means of acidizing two zones with packer setting in either open-
`
`hole or cased hole completion.” Ex. 1002 at 2854. “Three zone acidizing is
`
`possible with a three packer set-up and two different sized Tubing Port Valves.
`
`Ex. 1002 at 2854.
`
`IV. RC’S SECONDARY CONSIDERATIONS ARE TOO WEAK TO
`OVERCOME OBVIOUSNESS (POR 6-30)
`A. The Claimed Methods Did Not Contravene Accepted Wisdom
`(POR at 7-13)
`RC’s “accepted wisdom” depends on the claims requiring fracturing. See
`
`POR at 7-8. They do not (see supra Section III), and this argument can therefore be
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`Case IPR2016-01496
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`rejected. Independently, and for the other reasons in Section III above, RC’s
`
`“accepted wisdom” arguments fail.
`
`
`
`Further, RC does not contend that any single pre-invention reference
`
`explicitly teaches away from using a system like Lane-Wells or the Lane-Wells-
`
`Ellsworth system to OHMS acidizing. See McGowen1 at 79:11-82:4; see also
`
`McGowen2 at 17:19-18:6 and 22:22-27:25. As reflected in W.L. Gore & Assoc.,
`
`Inc. v. Garlock, Inc., on which RC relies, a teaching away is effectively required to
`
`support a contrary-to-accepted-wisdom argument. 721 F.2d 1540, 1551-52 (Fed.
`
`Cir. 1983). Indeed, Lane-Wells itself disclosed OHMS acidizing: “The Tubing
`
`Port Valve also provides a means of acidizing two zones with packer setting in
`
`either open-hole or cased hole completion.” Ex. 1002 at 2854. “Three zone
`
`acidizing is possible with a three packer set-up and two different sized Tubing Port
`
`Valves. Ex. 1002 at 2854.
`
`B. RC Has Not Established Nexus (POR at 28-30)
`RC’s only statement in the POR alleging a nexus to a particular claim is that
`
`McGowen has concluded that Packers Plus’ StackFRAC and Baker Hughes’
`
`FracPoint systems “both[] practice at least claim 1 of the ’774 Patent.” POR at 21
`
`(citing McGDec. at 43, Ex. A, B). RC therefore fails to explain how any of its
`
`arguments about praise, copying, and commercial success are tied to the claims of
`
`the ’505 Patent actually at issue. See POR at 10 (citing Ex. 2050/2051
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`Case IPR2016-01496
`Patent 7,134,505
`(“McGDec.”) at 40), 11 (citing McGDec. at 41), 13 (citing McGDec. at 7, Ex. B
`
`(comparing claims 24 and 27 of ’505 Patent to StackFRAC)), 26 (citing McGDec.
`
`at 42; Ex. 2081/2084 at §11. Thus, none of RC’s praise, copying, or commercial
`
`success arguments are relevant. Section 11 of McGowen’s second declaration
`
`focuses on the ’774 Patent’s invention for alleged commercial success (Ex.
`
`2081/2084 at 22:23-24:7) but does not tie that alleged commercial success to the
`
`’505 Patent.
`
`Exhibits A and B to McGDec discuss only claims 24 and 27 of the ’505
`
`Patent. But RC does not discuss with specificity the details of McGowen’s
`
`analysis or how it shows that each limitation of claims 24 and 27 are met. POR at
`
`13, 21. Therefore, substantial weight need not be given to that improperly-
`
`incorporated analysis (see, e.g., LG Chem, Ltd. v. Celgard, LLC, IPR2014-00692,
`
`slip op. at 32-33 (Paper 76) (P.T.A.B. Oct. 5, 2015)) or RC’s alleged nexus or
`
`commercial success evidence (see, e.g., CaptionCall, L.L.C. v. Ultratec, Inc.,
`
`IPR2015-00637, slip op. at 64-65 (Paper 98) (P.T.A.B. Sep, 7, 2016) (citing Rules
`
`42.6(a)(3) and 42.24)).
`
`Even if Mr. McGowen’s claim 24 and 27 analyses are fully considered, they
`
`do not entitle RC to any nexus presumption.
`
`First, there is no difference between the Lane-Wells-Ellsworth system and
`
`either PP’s StackFRAC system or Petitioners’ FracPoint system with respect to
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`Case IPR2016-01496
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`claims 24 and 27. See Petition at 55-56 (comparing Lane-Wells-Ellsworth system
`
`to claim 24) and 57-58 (comparing Lane-Wells-Ellsworth to claim 27); compare
`
`McGDec., Exs. A, B claim 24, 27 charts for StackFRAC and FracPoint systems
`
`(relying on claim 1 of ’774 Patent); see also McGowen1 at 64:1-65:25, 67:5-9
`
`(StackFRAC system meets claim 1 structure).
`
`Moreover, RC’s assertion that “[t]here is simply no evidence from which the
`
`Board could conclude that the claims as a whole were present in the prior art” is
`
`misleading. POR at 30. As McGowen admits, the structure of the system recited
`
`in the claims is also indistinguishable from that of Thomson (Ex. 1020), PP’s
`
`StackFRAC, Petitioners’ FracPoint, or Weatherford’s ZoneSelect systems. See
`
`McGowen2 at 161:1-18 (no structural differences between Thomson and
`
`commercial systems), 139:11-140:2 (same for StacFrac, Fracpoint); McGowen1 at
`
`67:22-69:23 (Thomson and StackFRAC systems are same with respect to structure
`
`of ’774 Patent’s claim 1), 71:10-72:23 (Thomson and FracPoint systems are same
`
`with respect to structure of ’774 Patent’s claim 1); McGDec., Exs. A, B claim 24,
`
`27 charts for StackFRAC and FracPoint systems (relying on claim 1 of ’774
`
`Patent).
`
`McGowen also confirmed that, other than conclusory assertions, he provided
`
`no evidence that either PP or Petitioners performed any of the method steps
`
`required of claim 1. McGowen1 at 133:14-139:2. All revenue RC relies on via
`
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`Case IPR2016-01496
`Patent 7,134,505
`Giraldi’s and McGowen’s declarations is from equipment sales, not sales of
`
`services. Id. at 121:14-132:8, especially 131:24-132:3 (Petitioners’ revenue),
`
`132:9-133:2 (PP provides no pumping services; PP’s revenue assumed to be
`
`equipment only).
`
`By addressing only method claims 24 and 27, McGowen effectively relies
`
`on “positioning the apparatus adjacent an open hole section of the wellbore” as the
`
`alleged novel use (“ANU”). McGDec. at Exs. A, B claims 24, 27 charts. But
`
`RC’s failure to provide any evidence of such use by PP or Petitioners precludes
`
`any nexus presumption. See Classco, Inc. v. Apple, Inc., 838 F.3d 1214, 1220 (Fed.
`
`Cir. 2016).
`
`RC’s advertising evidence does not cure these deficiencies. POR at 28-29.
`
`Exhibits 2056 and 2057 (PP case studies) cannot show pre-2015 nexus, and
`
`RC provides no evidence about dissemination. While Ex. 2019 describes the
`
`ANU, it also touts a Thomson-like use of FracPoint (“cased-hole environment”).
`
`Exhibit 2020 is not an advertisement per se, and it highlights several unclaimed
`
`alternatives (see 4, 5, 7, 10, 11, 16, 20) and uses (12: “cased hole applications”
`
`and “vertical … wellbores”). Ex. 2039 includes unclaimed features like swellable
`
`and cup-type packers, slips, and non-ball-actuated sliding sleeves. Ex. 2074 is not
`
`an advertisement; it shows, without discussion, an image of “Percentages for
`
`different frac methods at Weatherford” 78% of which were “Cemented P&P.” For
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`the cited videos (Exs. 2058-2059), RC provides neither a date nor evidence of
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`dissemination or public access. POR at 22.
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`C. RC’s Industry Praise Lacks Nexus (POR 13-18)
`RC’s industry praise and recognition evidence consists of articles, industry
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`reports, and a television story. All focus on the StackFRAC system, already taught
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`by Thomson (see supra Section IV.B.), rather than the ANU and, lack the required
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`nexus. Classco, 838 F.3d at 1220.
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`Ex. 2061 focuses on PP’s design of a “downhole system” and generally
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`discusses use of PP’s technology, not the StackFRAC system or ANU.
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`The cited portion of Ex. 2007 references the “StackFrac system” generally,
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`not the ANU, and does not assert the award was due to the ANU.
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`The cited portion of Ex. 2009 references “Packers Plus technology”
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`generally, not the ANU.
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`Ex. 2006 contains no mention of the ANU. RC cites the reference to multi-
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`stage fracturing in horizontal wells with StackFRAC, but Thomson disclosed that
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`non-open-hole use. Thomson at 97 (Abstract).
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`RC cites Ex. 2021’s reference to non-specific “hydraulic fracturing
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`technologies … particularly using horizontal wells,” but that was disclosed in
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`Thomson (Thomson at 97 (Abstract)). Ex. 2021 does not mention the ANU.
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`Ex. 2008 is cited for its characterization of PP as “[c]reators of the
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`StackFRAC system, the first ball drop system used to complete horizontal wells in
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`multiple stages,” but that was disclosed in Thomson. Id.
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`RC cites Ex. 2005 for its characterization that “StackFRAC, [PP’s] prize
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`product and primary innovation, is an open-hole ball drop completion system …
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`credited with unlocking old resource plays;” however, there is no explicit reference
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`to the ANU, for which Thomson’s system was already suited. See Ex. 2016
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`(replacement) at 101:21-102:2.
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`Exhibits 2047 and 2014 lack sufficient nexus to the ANU. Classco, 838
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`F.3d at 1220.
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`Exhibit 2021 references StackFRAC (2/14), but that system was present in
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`Thomson (see supra Section IV.B.); it does not reference StackFRAC in the
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`manner RC claims (POR 15). See McGowen1 at 142:7-25 and 145:18-148:9.
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`RC relies on Ex. 2014 as identifying a PP article (presumably “Snyder
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`2011,” which is not an exhibit) describing “the first commercial OHMS[F] systems
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`were developed and deployed in 2001.” POR at 17. Exhibit 2014 does not
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`describe the cited “systems” or deployment and cannot can show nexus to the
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`ANU. See Ex. 2014 at 4, first paragraph. Exhibit 2014 also describes “numerous
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`variants” of unclaimed: (1) packers in OHMS fracturing systems like “swellables,
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`cups, etc.” (Ex. 2014 at 4; see also McGowen1 at 112:13-22); and (2) uses like
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`cased-holes, as in Thomson (Ex. 2014 at 4 and 7 (“cased hole”), 6 (“when applied
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`in open hole”).
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`The discussion in Exhibit 2054 of using PP’s technology is not specific to
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`open-holes and does not mention the ANU (Ex. 2054 at 1-2), and Thomson had
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`already touted use- and time-savings in horizontal wells. See, e.g., Thomson at 97,
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`101 (cited in Daneshy1, ¶51 (cited in Petition at 14, 15) and ¶75 (cited in Petition
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`at 36, 38)); McGowen1 at 44:22-47:25.
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`The discussion in Ex. 2045 that “StackFRAC was the first ball drop system
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`created for open hole horizontal wells” is hearsay and cites no supporting
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`evidence; the other cited statements lack nexus because they do not refer to all
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`claim elements.
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`D. RC’s Commercial Success Lacks a Nexus (POR 24-27)
`PP’s revenue evidence merits no weight. Giraldi does not explain when or
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`for what PP received revenue. Ex. 2048 at 1 (intimating “vast majority” of non-
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`specific revenue relevant, but providing no showing of part attributable to sales of
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`StackFRAC, much less the ANU).
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`Regardless, whatever revenue portion is attributable only to StackFRAC
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`system sales cannot serve as the basis for commercial success because those
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`systems, relative to the claims, are indistinguishable from Thomson’s (McGowen1
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`at 62:11-65:25,67:18-21, 67:5-9, 67:22-69:23; McGowen2 at 161:1-18, 139:11-
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`140:2). Richdel, Inc. v. Sunspool Corp., 714 F.2d 1573, 1580 (Fed. Cir. 1983).
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`Claims 24 and 27 require performance of a method, including the ANU. See, e.g.,
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`Laird Techs., Inc. v. GrafTech Int’l Holdings, Inc., IPR2014-00024, slip op. at 36-
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`37 (Paper 46) (P.T.A.B. Mar. 25, 2015). Moreover, no PP revenue is tied to the
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`ANU because Giraldi offers no basis to assert PP has “performed fracture
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`treatments” (Ex. 2048 at 1). McGowen believed PP did not do so. McGowen1 at
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`132:9-133:2, 133:3-136:14.
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`Petitioners’ revenue deserves no weight. It is based solely on sales of
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`FracPoint systems (McGowen1 at 121:14-132:8, especially 131:24-132:3), which
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`are already in Thomson (see supra Section IV.B) and cannot provide basis for
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`commercial success. Richdel, 714 F.2d at 1580. The revenue is not tied to the
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`ANU because McGowen cited no evidence supporting his contentions that
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`Petitioners performed
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`the claimed method (McGowen1 at 136:15-139:2;
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`McGowen2 at 124:18-128:15). McGowen’s opinions based on underlying data not
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`in the proceeding are entitled to little, if any, weight. See Rule 65(a); 77 Fed. Reg.
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`48,756, 48,763. Exhibit 2051, the database with McGowen’s data and calculations
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`(McGowen1 at 121:14-132:8) was not filed.
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`McGowen also included Petitioners’ sales of systems with only swell
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`packers (“RE Packers”) (Ex. 1130; McGowen1 at 121:14-130:7; Ex. 1131), and
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`those sales accounted for over half his revenue total (Exs. 1130, 1131). Under
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`Petitioners’ definition, a swell packer is not a claimed SBP. See McGowen2 at
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`151:15-152:8.
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`Weatherford’s sales also deserve no weight because they are based solely on
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`sales of ZoneSelect systems, which are also indistinguishable from Thomson’s
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`system (see supra Section IV.B). Richdel, 714 F.2d at 1580.
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`Moreover, neither McGowen nor Giraldi provided evidence of market share
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`or the relevant market. See Exs. 2050, 2048; McGowen1 at 163:25-164:16 (no
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`market share) and 164:17-166:22, especially 164:17-25 (no prior consideration of
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`relevant market). Therefore, the relied-on gross sales figures do not show, or at
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`best weakly show, commercial success. Cable Electric Products, Inc. v. Genmark,
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`Inc., 770 F.2d 1015, 1026-27 (Fed. Cir. 1985).
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`Petitioners’ FracPoint sleeve sales (POR 25) do not cure these deficiencies
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`because each claim requires more
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`than a sleeve, which
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`is nonetheless
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`indistinguishable from Lane-Wells tubing port valve or Thomson’s MSAF tool.
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`McGowen1 at 62:11-65:25, 67:18-21, 71:10-72:23; McGowen2 at 161:1-18,
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`139:11-140:2; IPR2014-00024, Paper 46 at 36-37.
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`RC’s reliance on Exs. 2011 or 2074 also fails. POR at 26-27. Neither RC
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`nor McGowen address the explanations in Ex. 2011 or Ex. 2074 of the various
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`unhelpful (to RC) reasons that OHMS fracturing systems were chosen, including
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`“critical shortage of frac crews and equipment” (Ex. 2011 at 4-5), and water and
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`proppant availability (id. at 5).3 This was improper. LKQ Corp. v. Clearlamp,
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`LLC, IPR2013-00020, slip op. at 29 (Paper 73) (P.T.A.B. Mar. 27, 2014).
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`Furthermore, Ex. 2011 indicates that P&P and OHMS fracturing systems
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`were “the two most popular methods for stimulating horizontal multistage
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`completions” (page 1) and defines OHMS fracturing systems as including
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`“isolation media” that can take the form of “either external casing packers or
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`swellable packers.” Ex. 2011 at 2. Swellable packers are not the claimed SBP,
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`and “external casing packer” is a term sometimes used to refer to inflatable
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`packers. McGowen1 at 77:10-79:4, 111:14-112:12; McGowen2 at 151:8-152:8;
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`Coon at 13/19. RC does not assert that the claimed SBP would cover inflatable
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`packers (McGowen1 at 113:8-114:18), but neither RC nor McGowen address the
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`issue. See POR at 26-27; Ex. 1132/1133 at 155:1-15; McGowen1 at 152:2-22;
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`Rule 42.65(a). Ex. 2011 thus lacks nexus to the ANU.
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`E. RC’s Copying Evidence Is Meritless (POR 18-23)
`RC’s asserts through attorney argument4 that Exs. 2052 and 2053
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`“demonstrate” that Petitioners “developed their own system by copying Packers
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`Plus.” POR at 18-21. But the StackFRAC system shown in Ex. 2053 is in the
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`3 McGowen’s deposition statements (McGowen1 at 152:2-163:24) cannot cure the
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`McGDec.’s failure to address it. Rule 42.65(a); 77 Fed. Reg. at 48763.
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`4 RC requested no discovery.
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`prior art (Thomson). McGowen1 at 62:11-65:25, 67:18-21, 67:5-9, 67:22-69:23.
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`At best, the alleged copying lacks nexus. Wm. Wrigley Jr. Co. v. Cadbury Adams
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`USA LLC, 683 F.3d 1356, 1364 (Fed. Cir. 2012). The alleged “striking[]
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`similar[ity]” between the FracPoint and StackFRAC systems (POR at 21) shares
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`the same deficiency. The two documents RC cited as