UNITED STATES PATENT AND TRADEMARK OFFICE
`
`______________
`
`
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`
`
`BAKER HUGHES INCORPORATED
`and
`BAKER HUGHES OILFIELD OPERATIONS, INC.,
`Petitioners
`
`v.
`
`PACKERS PLUS ENERGY SERVICES, INC.
`Patent Owner
`
`______________
`
`
`Case IPR2016-00598
`Patent 7,861,774
`______________
`
`
`
`PETITIONERS’ REPLY IN SUPPORT OF MOTION TO EXCLUDE1
`
`
`
`1 This reply replaces Paper 48, and was email-authorized by the Board on
`June 7, 2017.
`
`36684613.1
`
`
`
`______________
`
`
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`
`
`BAKER HUGHES INCORPORATED
`and
`BAKER HUGHES OILFIELD OPERATIONS, INC.,
`Petitioners
`
`v.
`
`PACKERS PLUS ENERGY SERVICES, INC.
`Patent Owner
`
`______________
`
`
`Case IPR2016-00598
`Patent 7,861,774
`______________
`
`
`
`PETITIONERS’ REPLY IN SUPPORT OF MOTION TO EXCLUDE1
`
`
`
`1 This reply replaces Paper 48, and was email-authorized by the Board on
`June 7, 2017.
`
`36684613.1
`
`
`
`Petitioner’s Exhibit List
`
`Case IPR2016-00598
`Patent 7,861,774
`
`1003
`
`Description
`Exhibit
`1001 U.S. Patent No. 7,861,774 (“the ’774 Patent”)
`1002 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”)
`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”)
`1004 U.S. Patent No. 5,449,039 (“Hartley”)
`1005 Declaration of Ali Daneshy, Ph.D. (“Daneshy1”)
`1006 KATE VAN DYKE, FUNDAMENTALS OF PETROLEUM ENGINEERING (4th
`ed. 1997)
`RON BAKER, A PRIMER OF OIL WELL DRILLING (5th ed. (revised) 1996)
`1007
`1008 U.S. Patent No. 4,099,563 (“Hutchison”)
`1009 U.S. Patent No. 5,375,662
`1010 U.S. Patent No. 6,257,338 (“Kilgore”)
`1011
`Excerpts of Prosecution History of the ’774 Patent
`1012 U.S. Provisional Application No. 60/404,783
`1013
`Excerpts of Prosecution History of U.S. Patent No. 7,134,505 (“the
`’505 Patent”)
`1014 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. 1003 at 102-110)
`1015 Affidavit of Nancy Chaffin Hunter regarding the proceedings of the
`10th Middle East Oil Show & Conference (Bahrain March 15-18, 1997)
`(including Ex. 1002 at 12/26-23/26) – NOT FILED
`1016 Declaration of Rebekah Stacha regarding SPE 37482 (including Ex.
`1002 at Ex. A) – NOT FILED
`1017 Declaration of Rebekah Stacha regarding SPE 49523 (referencing Ex.
`1002 at p. 605, fn.28) – NOT FILED
`
`36684613.1
`
`i
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`
`
`Case IPR2016-00598
`Patent 7,861,774
`
`Exhibit
`1018
`
`1021
`
`1022
`1023
`
`Description
`Table Associated with qrySumNetValuebyFamily from Ex. 2051
`(contains PROTECTIVE ORDER MATERIAL)
`1019 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”)
`1020 March 1, 2017 email from Justin Nemunaitis, confirming RE Packer
`revenue in Ex. 1018 was included in revenue figure reported at Ex.
`2034 at 42:9.
`Transcript of February 28, 2017 Deposition Testimony of Harold R.
`McGowen III (“McGowen”)
`Second Declaration of Ali Daneshy, Ph.D. (“Daneshy2”)
`P.D. Ellis, et al., Application of Hydraulic Fractures in Openhole
`Horizontal Wells, SPE/Petroleum Society of CIM 65464 (2000)
`(“Ellis”)
`1024 M.J. Rees, et al., Successful Hydrajet Acid Squeeze and Multifracture
`Acid Treatments in Horizontal Open Holes Using Dynamic Diversion
`Process and Downhole Mixing, SPE 71692 (Sep. 30, 2001) (citing Ex.
`1032 at fn. 1) (“Rees”)
`January 19, 2017 Letter and Written Interrogatories propounded by
`plaintiffs in Rapid Completions LLC, et al. v. Baker Hughes Canada
`Co., Federal Court File No. T-1569-15) (Ottawa), regarding Canadian
`patent No. CA 2,412,072 (the “Related Canadian Litigation”)
`January 30, 2017 Letter and Responses to Ex. 1034
`Excerpt from February 16, 2017 transcript of Related Canadian
`Litigation
`
`1025
`
`1026
`1027
`
`
`
`36684613.1
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`ii
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`Case IPR2016-00598
`Patent 7,861,774
`Ex. 2021 – Authentication: The Lorraine decision concerns admissibility
`
`of electronically-stored information (“ESI”). The disputed ESI appears to have
`
`been “e-mail correspondence between counsel” for an arbitration dispute between
`
`the parties (Lorraine v. Markel American Ins. Co., 241 F.R.D. 534, 537 (D. Md.
`
`2007)), not a document purportedly created by a third party that was produced by
`
`a party to the suit. And the page of the Lorraine decision cited by RC is mere
`
`dicta. Id. at 552. Regardless, Petitioners did not create Ex. 2021. Thus, there is
`
`no basis for the “presumption” of authenticity to which RC retreats. See U.S. v.
`
`Brown, 688 F.2d 1112, 1115-1116 (7th Cir. 1982) (rejecting defendant’s argument
`
`that business records he produced for a company of which he was president were
`
`not authentic). While Ex. 2021 does contain “Rystad Energy” markings
`
`throughout, those markings are sponsored solely by attorney argument.
`
`Hearsay: Authenticity aside, RC’s reliance on hearsay exception (18) fails
`
`because RC cites directly to Ex. 2021 in its POR (Paper 26 at 37), rather than to
`
`Mr. McGowen’s citation to Ex. 2021 (on Ex. 2034 page 45/49). Nor does hearsay
`
`exception (17) apply; regardless of whether Ex. 2021 is a “market report,” RC has
`
`not shown that Ex. 2021 is “generally relied on by the public or by persons in
`
`particular occupations.” See Fed. R. Evid. 803(17) (emphasis added). Mr.
`
`McGowen’s specialized reliance (uncited by RC in its POR) does not fit the rule.
`
`Finally, RC’s purported non-truth-of-the-matter purpose for Ex. 2021 page 10—
`
`36684613.1
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`1
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`Case IPR2016-00598
`Patent 7,861,774
`that “persons in the field expected the patented technology to have had a
`
`significant market share” (Paper 42 at 1-2)—is improper new argument.
`
`Rule 703: RC’s Rule 703 argument is misplaced. Paper 42 at 2-3. The rule
`
`permits otherwise inadmissible evidence to be disclosed to a jury if a court
`
`determines it has sufficient probative value in helping the jury evaluate the opinion
`
`the evidence underlies. But, as explained above, Ex. 2021 underlies no opinion
`
`by Mr. McGowen that RC relies on its POR. See POR at 35-40.
`
`Ex. 2022 – Authentication: RC’s argument that this article is self-
`
`authenticating as a periodical under Rule 902 should be rejected as circular. See
`
`TRW Automotive U.S. LLC v. Magna Electronics Inc., IPR2014-01347, slip op. at
`
`7-8 (Paper 25) (P.T.A.B. Jan. 6, 2016). While the article does have “rigzone” in
`
`the URL, there is no evidence about what “rigzone” is or what “the layout” of a
`
`typical Rigzone article is. RC thus offers insufficient support for Rule 901(b)(4).
`
`Mr. Delaney’s testimony is irrelevant because he is neither the article’s
`
`author nor someone with personal knowledge of it. Ex. 2045 at ¶¶ 1, 2, 21. Unlike
`
`RC, others have authenticated purported internet articles alleged as secondary
`
`considerations evidence with author declarations. See Shimano Inc. v. Globeride,
`
`Inc., IPR2015-00273, slip op. at 18, 29 (Paper 40) (P.T.A.B. June 16, 2016).
`
`Hearsay: Authenticity aside, RC’s reliance on hearsay exception (18) fails
`
`because RC cites directly to Ex. 2022 in its POR (Paper 26 at 29), rather than to
`
`36684613.1
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`2
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`Case IPR2016-00598
`Patent 7,861,774
`Mr. McGowen’s citation to Ex. 2022 (on page 46/49 of Ex. 2034).
`
`Rule 703: RC’s Rule 703 argument fails because RC does not rely on any
`
`testimony by Mr. McGowen that Ex. 2022 underlies, instead citing Ex. 2022
`
`directly. See POR at 25-29 (discussing alleged praise).
`
`Ex. 2024 – RC’s speculation about the alleged timing of FracPoint’s
`
`development relative to when Petitioners allegedly obtained page 13/34 of Ex.
`
`2024 is improper new argument. RC’s statement that “Petitioners do not dispute”
`
`its copying story is misleading; RC’s unsupported attorney argument merited no
`
`“conflicting evidence or testimony.” Moreover, RC did not reveal that in the
`
`Related Canadian Litigation (see supra at iii), where RC’s baseless allegation was
`
`more substantively raised, a related Canadian entity of Petitioners refuted it. See
`
`Ex. 1025 at 1 (1. & 2.) and 3-4 (ques. 1-6 and 8-14); Ex. 1026 at 1 (¶2) and 1-3
`
`(responses to ques. 1-6 and 8-14); Ex. 1027 (trial testimony) at 188:5-195:6.
`
`Finally, RC fails in its attempt to rebut Petitioners’ explanation of why the
`
`alleged copying is irrelevant—at best, it involves the creation of one system
`
`(FracPoint) based on another system (StackFRAC), both of which are already in
`
`the prior art (Thomson). RC correctly concedes that its “patented invention” is the
`
`use of Thomson’s prior art system for fracturing in an open hole (Paper 42 at 7),
`
`but then incorrectly contends that Petitioners’ development of the FracPoint
`
`system gives rise to a nexus presumption. Id. at 7-8. That is not what the Federal
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`36684613.1
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`3
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`Case IPR2016-00598
`Patent 7,861,774
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`Circuit held in WBIP.
`
`In WBIP, the closest prior art lacked two elements ([B] and [D]) of the
`
`seven-element representative system claim, while the accused product lacked none.
`
`WBIP, LLC v. Kohler Co., 829 F.3d 1317, 1325-26, 1331 (Fed. Cir. 2016). Thus,
`
`there was a difference between the closest prior art and the accused product, but
`
`no difference between the accused product and the claim. Id. Here, there is no
`
`difference between the FracPoint and Thomson systems (relative to the disputed
`
`method claims), and there is a difference between the development of the
`
`FracPoint system and using it to fracture an open hole. Just as Petitioners have not
`
`attempted to show anticipation of method claims requiring fracturing in an open
`
`hole by the mere existence of Thomson, RC cannot show that those same method
`
`claims are met by the mere existence of the FracPoint system. See J.T. Eaton &
`
`Co. v. Atlantic Paste & Glue Co., 106 F.3d 1563, 1571 (Fed. Cir. 1997). Thus,
`
`even if Ex. 2024 suggested copying (it does not), Ex. 2024 would still be irrelevant
`
`because it would not support a nexus under WBIP or any other decision.
`
`Ex. 2025 – Authentication: Packers Plus’s production of Ex. 2025 does
`
`nothing to establish its authenticity. Neither does Mr. Delaney, who works for
`
`RC’s counsel, not Packers Plus. See Ex. 2045 at ¶¶ 1, 2; Paper 13. RC has not
`
`established that Mr. Delaney has personal knowledge, or is a custodian, of Ex.
`
`2025. Finally, RC’s argument that Ex. 2025 is authentic because “it contains
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`36684613.1
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`4
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`
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`Case IPR2016-00598
`Patent 7,861,774
`various markings indicating that it was made by Packers Plus” (Paper 42 at 8) is
`
`circular, self-serving attorney argument that merits no weight, especially
`
`considering RC is using the document to baselessly allege copying by Petitioners.
`
`Relevance: For the same reasons explained above for Ex. 2024, and given
`
`RC’s apparent agreement that Ex. 2025 is unnecessary, Ex. 2025 is irrelevant.
`
`Ex. 2034 –RC failed to put into evidence a significant amount of the
`
`material that would support or contradict Mr. McGowen’s allegations about which
`
`elements of the relevant method claims are allegedly met by which Baker Hughes
`
`products. Contrary to RC’s suggestion (Paper 42 at 9), without such evidence,
`
`there was nothing to cross examine Mr. McGowen about. As a result, RC failed to
`
`comply with at least 37 C.F.R. § 42.65, and any such allegations on which RC
`
`relied should be excluded (or given little or no weight).
`
`RC’s reliance on Rules 702 and 703 (Paper 42 at 9) is misplaced because
`
`this is not a dispute about Mr. McGowen’s reliance on otherwise inadmissible
`
`evidence; there is no evidence here (at all) – just product names and numbers. And
`
`contrary to RC’s argument, striking those names and numbers from Mr.
`
`McGowen’s report would impact Mr. McGowen’s opinions on pages 2/15, 3/15,
`
`4/15, and 6/15 of Ex. B of Ex. 2034 (as identified in Paper 39 at 7) by rendering
`
`them, and RC’s reliance on them (POR at 33, 1st ¶), inadequately supported.
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`June 8, 2017
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`/Mark T. Garrett/
`Mark T. Garrett
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`36684613.1
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`5
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`
`
`CERTIFICATE OF SERVICE
`
`Pursuant to 37 C.F.R. § 42.6(e), the undersigned certifies that on June 8,
`
`2017, a complete copy of PETITIONERS’ REPLY IN SUPPORT OF MOTION
`
`TO EXCLUDE was served on Patent Owner’s Exclusive Licensee via email (by
`
`consent), as follows:
`
`hhamad@caldwellcc.com
`bcaldwell@caldwellcc.com
`jnemunaitis@caldwellcc.com
`gonsalves@gonsalveslawfirm.com
`rapid@caldwellcc.com
`
`
`
`/Mark T. Garrett/
`Mark T. Garrett(Reg. No. 44,699)
`
`
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`36684613.1
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