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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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`BAKER HUGHES INCORPORATED and
`BAKER HUGHES OILFIELD OPERATIONS, INC.,
`Petitioner,
`
`v.
`
`PACKERS PLUS ENERGY SERVICES, INC.,
`Patent Owner.
`____________
`
`Case IPR2016-00596 (Patent 7,134,505 B2)
`Case IPR2016-00597 (Patent 7,543,634 B2)
`Case IPR2016-00598 (Patent 7,861,774 B2)
`____________
`
`Record of Oral Hearing
`Held: November 2, 2017
`____________
`
`
`
`
`Before SCOTT A. DANIELS, NEIL T. POWELL, and CARL M.
`DeFRANCO, Administrative Patent Judges.
`
`
`
`
`
`Case IPR2016-00596 (Patent 7,134,505 B2)
`Case IPR2016-00597 (Patent 7,543,634 B2)
`Case IPR2016-00598 (Patent 7,861,774 B2)
`
`
`
`APPEARANCES:
`
`ON BEHALF OF THE PETITIONER:
`
`
`MARK T. GARRETT, ESQUIRE
`EAGLE ROBINSON, ESQUIRE
`Norton Rose Fulbright US LLP
`98 San Jacinto Boulevard
`Suite 1100
`Austin, Texas 78701
`
`
`ON BEHALF OF PATENT OWNER:
`
`
`JUSTIN NEMUNAITIS, ESQUIRE
`Caldwell Cassady Curry
`2101 Cedar Springs Road
`Suite 1000
`Dallas, Texas 75201
`
`
`
`
`The above-entitled matter came on for hearing on Thursday,
`
`November 2, 2017, commencing at 10:00 a.m., at the U.S. Patent and
`Trademark Office, 600 Dulany Street, Alexandria, Virginia.
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`Case IPR2016-00596 (Patent 7,134,505 B2)
`Case IPR2016-00597 (Patent 7,543,634 B2)
`Case IPR2016-00598 (Patent 7,861,774 B2)
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`
`P R O C E E D I N G S
`- - - - -
`JUDGE POWELL: Good morning. This is a hearing for
`IPR2016-00596, IPR2016-00597 and IPR2016-00598. The 596 case
`involves Patent 7,134,505 B2, the 597 case involves 7,543,634 B2 and the
`598 case involves Patent Number 7,861,774 B2. IPR 2016-01496 has been
`joined with IPR2016-00596. IPR2016-01505 has been joined with
`IPR2016-00597. And IPR2016-01506 has been joined with
`IPR2016-00598.
`In the hearing room with me, I have Judge DeFranco, and joining
`us via video we have Judge Daniels. With that said, can we have counsel for
`Petitioner state your name for the record, state your names for the record.
`MR. GARRETT: Good morning. It's Mark Garrett. With me
`today is Eagle Robinson. Both of us are from Norton Rose Fulbright. And
`with us in the audience is Anthony Matheny, in-house counsel for
`Petitioners.
`JUDGE POWELL: Very good. And, Patent Owner, please state
`your names for the record.
`MR. NEMUNAITIS: Good morning, Your Honor. Justin
`Nemunaitis and with me is counsel, Greg Gonsalves and Bradley Caldwell.
`And also here today is Tracey Beaudoin, in-house counsel for Packers Plus,
`Dan Themig, Inventor and CEO of Packers Plus and author of the Ellsworth
`reference that's at issue in all these grounds, and Phil Mitchell for Rapid
`Completions.
`JUDGE POWELL: Okay. Each party will have 45 minutes to
`present arguments. The Petitioners will start and may reserve rebuttal time
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`Case IPR2016-00597 (Patent 7,543,634 B2)
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`and then the Patent Owner will respond and, of course, Petitioner will be
`able to -- will finish after the Patent Owner's response, if any rebuttal time
`remains.
`When you present, please identify each exhibit clearly and
`specifically, such as by slide or screen number. It's particularly important
`because Judge Daniels cannot see the screen. One other housekeeping item
`is I want to note that we have assertions of improper new arguments and
`evidence in record. As always when we prepare the final decisions for the
`cases, we'll exercise vigilance to ensure that we don't rely on improper new
`arguments and evidence in finding for one party or the other and that will
`take into account any specific assertions on the record.
`For today, each party will be permitted to discuss any argument or
`evidence already in the record and, of course, each party may use any of its
`allotted argument time to discuss any concerns that certain arguments or
`evidence were improperly known.
`With that all out of the way, does either party have any questions
`before we begin?
`MR. GARRETT: No, Your Honor.
`MR. NEMUNAITIS: Your Honor, I do have one question.
`JUDGE POWELL: Sure.
`MR. NEMUNAITIS: If we served our slides, my understanding is
`that they're not allowed to refer to them until we refer to them. Just given
`that we only have 45 minutes, I want to make sure I don't need to spend the
`first five minutes explaining the proper interpretation of the slides, but I
`don't know if there's a rule on that or not.
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`JUDGE POWELL: Well, let me ask, do they intend to refer to --
`MR. GARRETT: We will not be referring to their slides.
`MR. NEMUNAITIS: Okay. Non-issue.
`JUDGE POWELL: Okay. Certainly no problem. I think we got
`everything out of the way then and we'll let Petitioner begin.
`MR. GARRETT: Judge DeFranco, Judge Powell, Judge Daniels,
`good morning.
`JUDGE POWELL: Good morning. Do you want to reserve any
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`time?
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`MR. GARRETT: I would like to reserve about 15 minutes, but
`that's going to be flexible.
`JUDGE POWELL: Okay.
`MR. GARRETT: As reflected on slide 2, we would like to talk
`today about the '774 patent. That's the one involved in the 598 and 1506
`proceedings.
`And moving to slide 3, specifically we'd like to begin with the 598
`proceeding and that is the proceeding that involves the Thomson and
`Ellsworth grounds. So, we are going to go through and highlight some of
`the arguments and the evidence that we've made showing why all the claims
`of the '774 patent are obvious over the Thomson and Ellsworth grounds.
`Moving to slide 4, we're looking at an assembled tool string from
`the patent itself. Shown in red are the solid body packers, and shown in blue
`are the ball-actuated sliding sleeves.
`Moving to slide 5, this is an enlarged image from the patent of the
`packer itself. The two packing elements are not colored and they're
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`positioned apart from each other separated by a red sleeve and a purple
`sleeve that act as pistons. And on the outsides of those packing elements are
`green fixed stop rings.
`So, what happens is fluid comes down through the tool string. It
`goes out through that small blue port that you see kind of in the left middle
`of that figure and it pushes those pistons away from each other and they
`extrude the packing elements between the pistons and the outer fixed stop
`rings to hydraulically set the packer.
`Now, moving to slide 6, these are two images of the ball-actuated
`sliding sleeves themselves. The top image is unactuated and the bottom
`image is actuated. The sleeves are illustrated in blue. They're sitting inside
`a mandrel that's got yellow highlighted ports in it. And what you're seeing
`in the bottom image is a green ball that's been flowed down from the surface
`under pressure. It hits that purple seat. It seals. Pressure backs up behind it.
`And when it gets high enough, the blue sleeve breaks free of the mandrel
`and shifts downhole to the right in the bottom image.
`Slide 7 is a quote that reflects that these systems can be used not
`just in open holes, but in cased holes as well, and this is from the summary
`of the invention of the patent at issue.
`Slide 8 we have Thomson. This shows the system run into a
`horizontal section of a cased wellbore. You're seeing the packers here.
`Rather than red, they're shown in blue and the ball-actuated sliding sleeve
`which Thomson describes as his MSAF tool, which stands for multistage
`acid frack, is shown in red.
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`Now, the claim requires two sleeves, three packers. You see two
`packers and one sleeve here, but Thomson makes clear that he has up to nine
`sleeves and up to nine of these packers.
`JUDGE DeFRANCO: Mr. Garrett, does the '774 patent, does that
`speak to fracturing fluid and acidizing fluid as far as being run through the
`tube to push against that ball that you've shown in the previous slide?
`MR. GARRETT: It does. The fluid that's described in the patent
`itself is described as including water and acid both. Those are options.
`What we see in the next slide, slide 9 -- sorry, the previous slide
`was slide 8 -- is an enlarged view of Thomson's packer. So this, too, is a
`solid body packer. It's hydraulically settable, has the same basic elements
`that we saw in Thomson's -- in the patent's packer. The fixed stop ring is on
`the top in this image. There's a piston at the bottom. And between them are
`three different packing elements that get squeezed together and extruded
`outwardly through the hydraulic setting pressure that's exerted on them by
`the piston.
`Slide 10 we have Thomson's version of the ball-actuated sliding
`sleeve and it is just like the patented version. It's got a blue sleeve illustrated
`inside of a mandrel. It has yellow ports. In the bottom image you see the
`green ball has flowed down. It's seated or sealed against fluid pressure
`seated in that purple seat. And when pressure gets great enough, the sleeve
`breaks free of the mandrel and shifts to expose those ports.
`So Thomson is the system that's recited in the claims. It is run into
`a horizontal section of a wellbore and it is frack through. The only
`difference between this system and what they've claimed is an open hole,
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`and that is the only argument that Patent Owner's representative, Rapid
`Completions, has made. The difference they argue is that a POSITA would
`never think to use the Thomson system in an open hole.
`And we're going to go through now and look at the arguments and
`the evidence, some of the arguments and the evidence that they've put
`forward and why it doesn't rise to the level of overcoming our obviousness
`showing.
`One thing I'd would like to mention before we move on, and I'd
`like to go backwards actually to slide 8, I mentioned that what you're seeing
`here is the Thomson system is in a cased hole. Now, importantly, the
`Thomson system does not include that casing. The casing is just the
`environment into which the system is run as we described in the background
`section of the Petition.
`When a wellbore is drilled, it can be cased or it could be left open.
`If it's cased, the casing is put in there and literally cemented to the formation.
`It effectively becomes the borehole and that's the environment into which a
`system is placed. This is reflected in Packers Plus's own expert's testimony
`in a prior case against Halliburton where he's talking about the fact that they
`used tools, such as packers, that were initially designed for cased holes and
`open holes successfully.
`There's no art that says or discusses removing casing from a
`system in order to use that system in an open hole. There's only discussions
`of using systems and tools in open holes and in cased holes. And this is also
`borne out in the preceding slide, slide 7, that I'll toggle back to you for just a
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`second, where we see in the patent itself it discusses using a system in an
`open hole or a cased hole.
`So moving forward to slide 11.
`JUDGE DeFRANCO: Mr. Garrett, what's the purpose of the
`casing, I mean, why wouldn't every completion system just be an open hole?
`MR. GARRETT: Yeah. So it's used for different purposes. Dr.
`Daneshy talks about that in his declaration testimony that we cite in the
`Petition. Some formations are too soft to complete, in other words, stimulate
`through or produce out of open. So one of the references that they have
`cited in the 1506 proceedings is the Owen reference. And the Owen's
`reference is talking about the Dan field in the North Sea and
`it's talking about how in that environment, when they first started to drill
`horizontal holes in 1987, they acid fracked them open and they had success.
`But after a few years they found that the holes began to collapse, so they
`realized in that particular field it's too soft to finish the boreholes open.
`They needed to start cementing and casing them, so the casing can provide
`structural support for a borehole.
`There can be other situations where you're in a field that has a lot
`of intervening zones that are water and then hydrocarbon and casing can be
`one way to wall off the fields or the aspect of that field, the zones in that
`field, that you don't want to bleed into your borehole.
`Thirdly, it can also be a mechanism by which you keep fluids that
`are in the borehole from getting into the formation and possibly
`contaminating drinking water or something like that. So the decision on
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`whether to case or not is made on -- not to use a pun, but on a case-by-case
`basis.
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`JUDGE DeFRANCO: Depending on the formation.
`MR. GARRETT: Depending on the formation, depending on the
`purpose of the intervention as well.
`JUDGE DeFRANCO: Wouldn't that also be true as far as the type
`of packer that goes into the hole as well? I mean, you can't just use any type
`of packer being an open hole versus a cased hole, right? Does it have to be a
`certain type of packer for a cased hole, a certain type, or it has to be -- would
`it have to be a certain type of packer for the open hole as opposed to a cased
`hole which already has, you know, a predetermined surface?
`MR. GARRETT: Well, what we learned from Ellsworth is that
`solid body packers, in other words, the packers that we see in Thomson, that
`we see in Ellsworth are usable in both cased holes and open holes.
`Ellsworth tells us that when you're acidizing, these solid body packers are
`going to provide sufficient isolation to do the job.
`Their own expert in the prior litigation against Halliburton said it's
`been known in the art and we have this testimony as well through Dr.
`Daneshy that tools, specifically packers that have been designed for cased
`holes, were known to have been used successfully in open holes.
`JUDGE DeFRANCO: Are you speaking of Mr. McGowen made
`that type of statement?
`MR. GARRETT: No, not Mr. McGowen. Packers Plus's expert in
`a case against Halliburton that we cite. Essentially, I believe it's the
`knowledge of ordinary skill section of our Petition and his name was --
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`JUDGE DeFRANCO: You can find it later, Mr. Garrett, but it was
`-- it's in the record, his testimony?
`MR. GARRETT: It is in the record.
`JUDGE DeFRANCO: Okay.
`MR. GARRETT: Thank you.
`So, the first argument that they make is, look, we pointed out --
`and we're going to go over this in just a minute in slide 12 -- there's a strong
`financial motivation to use the Thomson system. It will cut down on
`stimulation time. And if the formation that you're fracking in allows you to
`drill a hole that's going to be stable, it's going to be close to gauge, you're
`also going to save money by foregoing the casing and the cementing and the
`time it takes to put those in.
`And Packers Plus' first argument has essentially been, look, that's
`kind of loser. Because casing is so critical to the fracking operation, it's like
`fracking fluid they analogized it to. You could remove it, you could remove
`the fracking fluid, for example, but then you couldn't frack. That's how
`critical they want the Board to believe that casing has to the operation. So,
`financial incentives really don't rise to the level of something that will
`motivate a person. They don't even know that open-hole fracturing is
`something that can be done.
`In slide 12 we see, number one, that's just inconsistent with the
`explanations of the motivations, basically their attempt to downplay those.
`You're going to reduce the stimulation time. You're going to reduce the
`money you spend on casing and cementing. You know from Ellsworth that
`your packers are going to do the job that you need them to do.
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`And when we get to talking to Mr. McGowen about those
`contentions, he concedes, you know what, economics drove completions
`decisions. The Thomson reference, I acknowledge that when they looked at
`the project they had in front of them, four wells that they were going to
`stimulate, they estimated it's going to take with normal stimulating time and
`procedure, which they've effectively admitted is plug and perf, it's going to
`take 30 days per well and they did in four days what they were going to have
`to do in four months with that Thomson system.
`So he conceded that's a big savings. By his own admission, that
`was hundreds of thousands of dollars of rig time a day which translates into
`tens of millions of dollars in savings. So by his own admission, the
`economics is a huge driver.
`In addition to that, he admitted that cemented casing is not required
`for hydraulic fracturing in open holes or for fracturing at all in open holes.
`He said going without casing is an option to consider and he conceded that
`open-hole fracturing had been done before, and then we supplied evidence in
`the form of the Coon reference to corroborate his admission. It shows that
`open-hole fracturing had been used for both acid fracturing and hydraulic
`fracturing, the low volume sand fracturing that's referenced in Coon.
`JUDGE DeFRANCO: Mr. Garrett, I think Rapid Completions'
`point as far as this economic decision goes is that drilling is expensive in and
`of itself. By nature, you know, these wells are going to be expensive to drill
`to engage in a completion.
`So my question is, what's the percentage that it costs more to do a
`cased hole as opposed to an open hole, do you have any idea about that?
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`MR. GARRETT: You know, we don't have that evidence in the
`record. What we have is Ellsworth saying that you are going to do
`completions more economically if you move away from the casing and the
`cementing, if you can. But there's two components to that financial
`incentive. One is getting away from the traditional approach of plug and
`perf and going to a stimulation procedure where you only have one trip into
`the wellbore with your tool string.
`With plug and perf you're going in and out of the well string over
`and over again and that's what drove that 30 days per well of estimated
`completion time. And by contrast when you're going in with the Thomson
`tool string, you're going in in one day and doing that same thing.
`And that aspect of the savings was so significant, they had decided
`that Thomson augers, they weren't going to be able stimulate that way. It
`would not be economical, so that's sort of the magnitude of using Thomson.
`JUDGE DeFRANCO: Tell me why you're going in and out
`because of the perf.
`MR. GARRETT: Yeah. Well, because you've got to set plugs.
`You've got to perforate. You've got to pull the perforating gun out, then
`you've got to flow down a ball, then you've got a frack. Then you've got to
`run the perforating gun back in, perforate, pull it out, set another plug, flow
`another ball down. So there's lots and lots of ins and outs. And, in fact, in
`his declaration, his first declaration, pages 39 and 40, Mr. McGowen talks
`about the challenges and the risks and the expense involved with plug and
`perf.
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`The second argument that we cover on slide 15 is their argument
`about conventional wisdom and this is more of the same flavor that
`cemented casing was required. There were a lot of variations and kind of
`components to that argument. The long and short of that is, as we get to in
`slide 16, it's undercut by Mr. McGowen's own admissions.
`I mean, we asked him in his deposition, I think starting on page 72
`of that deposition, your testimony is cemented casing is required, right, and
`there was basically explanation and qualification. And three or four pages
`later I said, well, so it sounds like going without cemented casing is an
`option to consider. His response was, yes, it's an option to consider.
`So, as we see on slide 17, the evidence in the 598 case -- and the
`evidence between these two cases is slightly different. The evidence in the
`598 case that they have put in Mr. McGowen's declaration, but did not
`actually cite in their Patent Owner Response were two papers by Crosby and
`Emanuele, and essentially in those papers the authors are describing the
`struggle with trying to get perforations in the casing in a location that's not
`going to give rise to fracture tortuosity and near wellbore complexity that's
`the primary problem with which is screen-out.
`And what Dr. Daneshy explains for us in his second declaration
`and in our Reply is that those are problems that are caused by open-hole
`fracturing. They're actually mitigated by it.
`Moving to slide 18, the last issue that we'll discuss that they raised
`before we get to secondary considerations is the issue of risk and expense.
`Their basic argument is Thomson had problems. A POSITA is risk adverse.
`They're not going to be comfortable taking Thomson and using it again.
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`And on slide 19 we highlight the points that we made to show that
`that's just not supported by the evidence. The risks that they're talking about
`are not risks to life and limb. They're operational risks and they're normal
`and they were overcome. And they did not concern either the packers or the
`ball-actuated sliding sleeves.
`In addition --
`JUDGE DeFRANCO: So, Mr. Garrett, your point with Thomson
`is not to necessarily by motivation to remove the casing. It's actually to find
`motivation to take that completion system, the MSAF tool as well as the
`packers and utilize them in an open hole, right?
`MR. GARRETT: That's correct, Your Honor.
`JUDGE DeFRANCO: Does Mr. McGowen admit that those -- that
`that system meets the claim limitations aside from the open hole?
`MR. GARRETT: Yes, he does.
`JUDGE DeFRANCO: So he admits the same type of packers and
`the same type of sliding sleeve would work.
`MR. GARRETT: That's correct.
`JUDGE DeFRANCO: Can you tell me exactly where Mr.
`McGowen admits that in his deposition? Is there a specific place that you
`can point to?
`MR. GARRETT: I think there is.
`JUDGE DeFRANCO: I mean, you may be getting to it, but I'm
`just curious.
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`Case IPR2016-00596 (Patent 7,134,505 B2)
`Case IPR2016-00597 (Patent 7,543,634 B2)
`Case IPR2016-00598 (Patent 7,861,774 B2)
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`MR. GARRETT: Yes, yes. If you'll give me a moment, I'll
`identify that for you and I'll take my moment now, if I can, if that's okay. I
`don't want to let the question hang out there.
`JUDGE DeFRANCO: Sure.
`MR. GARRETT: And let me answer that in part by explaining
`that they have not taken the position that the claims are not met by either --
`that the sliding sleeve is not met by Thomson's MSAF tool or that the solid
`body packer recited in the claims is not met by Thomson's solid body
`packer. So, in part, I don't know that we extracted a specific confession or
`admission from him that those tools meet the limitations because he didn't
`put forward a contention otherwise and they didn't push a contention
`otherwise in their Patent Owner Response.
`JUDGE DeFRANCO: So in Petitioner's view, the only issue is
`whether you can combine these two references.
`MR. GARRETT: Absolutely. The only issue --
`JUDGE DeFRANCO: To teach using Thomson's system in --
`what is it, Ellsworth's open hole?
`MR. GARRETT: Well, it's a hole like Ellsworth. What we
`explained was that they have conceded, in other words, they have not fought
`us on the notion that Thomson's system meets all the structural limitations in
`the claims and we -- I remember going through that with him in his
`deposition and we have cited that in our Reply to point that out.
`The only position they have taken is a POSITA would not have
`done this in an open hole. You know, there are several flavors to that
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`Case IPR2016-00597 (Patent 7,543,634 B2)
`Case IPR2016-00598 (Patent 7,861,774 B2)
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`argument. In addition to that, they've taken a position of secondary
`considerations overcoming any prima facie showing that we've made.
`So, as my colleague goes through the fine details on that, I want to
`keep moving if that's okay.
`JUDGE DeFRANCO: Yes, please.
`MR. GARRETT: Okay. Thank you.
`To round out our point on their argument about risk and expense,
`the evidence shows, in fact, that plug and perf was the procedure that was
`risky and it was expensive and that's, again, borne out also by Mr.
`McGowen's own declaration, pages 39 and 40 of Exhibit 2034, and they
`don't have any evidence and he couldn't point to any evidence that showed
`that open-hole fracturing was dangerous.
`So, moving to slide 21 and secondary considerations. And before I
`do that, I'm sorry, I'm pausing to look at what my colleague has handed me
`about the admission issue.
`Your Honor, and this is in the 1506 case, but in our Reply on page
`20 we cite to the deposition testimony of Mr. McGowen who is conceding
`that Thomson is no different than what's recited in the claims.
`JUDGE DeFRANCO: What page, what testimony was that?
`MR. GARRETT: So the testimony spanned 62 through 69 of his
`first deposition.
`The challenge and the problem for them with their secondary
`considerations evidence is to the point that, Judge DeFranco, you just made,
`their allegation of nonobviousness is based on use in an open hole, but their
`secondary considerations evidence is focused on a system and that's what
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`Case IPR2016-00597 (Patent 7,543,634 B2)
`Case IPR2016-00598 (Patent 7,861,774 B2)
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`we're going to see over the course of these next slides. That's slide 22
`talking generally about nexus.
`The first secondary considerations --
`JUDGE DANIELS: Counsel, were you going to expand a little bit
`any further on the issue -- I'm sorry, it's back a little bit to slide 19 -- on the
`risks? Were you going to do that later or I just -- I had a question with
`regards to this issue of life and limb versus operational risk.
`MR. GARRETT: Just, please, Judge Daniels, go ahead. I was not
`going to spend more time on that, but I'm happy to answer questions.
`JUDGE DANIELS: Yeah, just quickly, was there -- I don't
`remember an issue being raised between these issues. Is there -- I mean, I
`don't remember a particular issue of life and limb being raised, but why is
`operational -- why are operational risks mitigated by comparison to that?
`MR. GARRETT: In their Patent Owner Response, they stress risk
`and they cite to a portion of Mr. McGowen's testimony, his declaration
`testimony where he cites the Macondo disaster, as if that were somehow
`analogous. So, we just wanted to make clear there is nothing, anything even
`remotely like this at play in this case. So, that was really the purpose of the
`juxtaposition between operational and life and limb.
`But on the substance of the operational, he raised four to five
`points and we went through those very extensively in his deposition and
`cited to that testimony in our Reply. And at sort of the bottom, he conceded
`that as far as the expense that would come out of those operational risks, he
`wasn't sure at all that it outweighed the tens of millions of dollars in savings
`that were gained by using the Thomson system.
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`Case IPR2016-00597 (Patent 7,543,634 B2)
`Case IPR2016-00598 (Patent 7,861,774 B2)
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`And so in addition to that when Dr. Daneshy testified and
`explained in his second declaration just what those operational challenges
`that they overcame were about, he showed us that those are things that are
`normal, even in systems that are well proven and that have been used before.
`So, there's nothing unique about the Thomson system described in the
`Thomson reference that would have given a POSITA the kind of pause that
`they alluded to, that they contend they would have had.
`In addition to that, one more point. What we got from Mr.
`McGowen in his testimony was that he was really under the impression that
`a POSITA was in a position of what he called extreme risk because they had
`ultimate responsibility, and Dr. Daneshy explained that's not how the real
`world worked back in 2001.
`Judge Daniels, is that --
`JUDGE DANIELS: Thank you.
`MR. GARRETT: You're welcome.
`Okay. Moving back to secondary considerations briefly, the
`contrary to accepted wisdom argument that we highlighted on slide 23 as we
`show on slide 24, I mean, the fundamental legal failing is they don't show a
`reference that teaches that open-hole fracturing is going to lead to the
`problems that they describe. That's the long and short of it. There is not a
`teaching away, and that's what they need for that strain of secondary
`considerations.
`Slide 25 we highlight their arguments about industry praise and
`copying.
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`Case IPR2016-00596 (Patent 7,134,505 B2)
`Case IPR2016-00597 (Patent 7,543,634 B2)
`Case IPR2016-00598 (Patent 7,861,774 B2)
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`In slide 26 points about that. Their industry praise is -- none of it
`is linked directly to use of their system in an open hole. By and large
`everything is tied directly to the StackFRAC system. In fact, their broadest
`recitation of the praise that they got ends with explaining that they got
`awards for their StackFRAC system, but that's not what the invention is.
`The copying is -- just it's pure speculation. Baker used it not
`copying their system. They make those -- they make that attorney argument
`based on a stack of documents that's not even chronologically in order.
`There's no evidence that the document that we allegedly copied was in our
`possession at the time we were developing our sys
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