Paper No. 1
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`_
`
`BEFORE THE PATENT TRIAL AND APPEAL
`BOARD
`
`WEATHERFORD INTERNATIONAL, LLC;
`WEATHERFORD/LAMB, INC.;
`WEATHERFORD US, LP; and WEATHERFORD
`ARTIFICIAL LIFT SYSTEMS, LLC
`Petitioners
`
`v.
`
`PACKERS PLUS ENERGY SERVICES,
`
`INC., Patent Owner
`
`Inter Partes Review No. IPR2016-
`01517
`Patent
`7,134,505
`
`PETITION FOR INTER PARTES REVIEW UNDER 35 U.S.C.
`§ 312
`
`

`
`TABLE OF CONTENTS
`INTRODUCTION.............................................................................................. 1
`
`INTRODUCTION ............................................................................................ .. 1
`
`TABLE OF CONTENTS
`
`I.
`
`I.
`
`II. MANDATORY NOTICES................................................................................ 5
`
`II. MANDATORY NOTICES .............................................................................. .. 5
`
`A. Real Party in Interest (37 C.F.R. § 42.8(b)(1)) ...................................... 5
`A. Real Party in Interest (37 C.F.R. § 42.8(b)(l)) .................................... .. 5
`
`B. Related Matters (37 C.F.R. § 42.8(b)(2))............................................... 5
`B. Related Matters (37 C.F.R. § 42.8(b)(2)) ............................................. .. 5
`
`C. Lead and Back-Up Counsel (37 C.F.R. § 42.8(b)(3))............................ 5
`C. Lead and Back-Up Counsel (37 C.F.R. § 42.8(b)(3)) .......................... .. 5
`
`D. Service Information (37 C.F.R. § 42.8(b)(4)) ........................................ 5
`D.
`Service Information (37 C.F.R. § 42.8(b)(4)) ...................................... .. 5
`
`III. GROUNDS FOR STANDING .......................................................................... 6
`
`GROUNDS FOR STANDING ........................................................................ .. 6
`
`III.
`
`IV.
`IV.
`
`STATEMENT OF PRECISE RELIEF REQUESTED FOR EACH CLAIM
`STATEMENT OF PRECISE RELIEF REQUESTED FOR EACH CLAIM
`
`CHALLENGED................................................................................................. 6
`
`CHALLENGED ............................................................................................... .. 6
`
`A. Claims for Which Review Is Requested (37 C.F.R. § 42.104(b)(1))..... 6
`A. Claims for Which Review Is Requested (37 C.F.R. § 42.l04(b)(l))..... 6
`
`B. Statutory Grounds of Challenge (37 C.F.R. § 42.104(b)(2))................. 6
`B.
`Statutory Grounds of Challenge (37 C.F.R. § 42.lO4(b)(2)) ............... .. 6
`
`V.
`
`V.
`
`FIELD OF TECHNOLOGY.............................................................................. 7
`
`FIELD OF TECHNOLOGY ............................................................................ .. 7
`
`A. Drilling an Oil Well................................................................................ 7
`A. Drilling an Oil Well .............................................................................. .. 7
`
`B. Prior Art Stimulation Techniques .......................................................... 7
`B. Prior Art Stimulation Techniques ........................................................ .. 7
`
`1. Thomson................................................................................................. 8
`
`Thomson ............................................................................................... .. 8
`
`1.
`
`2. Ellsworth .............................................................................................. 11
`
`Ellsworth ............................................................................................ .. ll
`
`2.
`
`3. Yost....................................................................................................... 13
`
`3. Yost ..................................................................................................... .. 13
`
`VI.
`
`VI.
`
`LEVEL AND KNOWLEDGE OF POSITA.................................................... 15
`
`LEVEL AND KNOWLEDGE OF POSITA .................................................. .. 15
`
`ii
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`

`
`IPR2016-01517
`Patent 7,134,505
`A. Level of Ordinary Skill ........................................................................ 15
`
`B. A POSITA Knew of Available Combinations of Completion Tools .. 15
`
`C. Patent Owner Admissions: A POSITA Knew that Cased Hole
`
`Tools/Systems Could be Used in Open Hole......................................................... 16
`
`VII. THE ’505 PATENT ......................................................................................... 21
`
`A. Prosecution History .............................................................................. 25
`
`B. Claim Construction (37 C.F.R. § 42.104(b)(3))................................... 26
`
`1.
`
`2.
`
`“solid body packer” (claims 19 and 24)............................................ 26
`
`“sleeve shifting means for moving the second sleeve
`
`from the
`
`closed port position to the position
`
`permitting fluid flow” (claims 19 and 24)
`
`26
`
`VIII. REASONS FOR THE RELIEF REQUESTED UNDER 37 C.F.R.
`
`§§ 42.22(a)(2) AND 42.104(b)(4).................................................................... 27
`
`A. Ground 1 – Obvious over Thomson in view of Ellsworth and further in
`
`view of Yost ........................................................................................................... 27
`
`IX. CONCLUSION................................................................................................ 59
`
`iii
`
`

`
`IPR2016-01517
`Patent 7,134,505
`
`TABLE OF AUTHORITIES
`
`Cases
`
`Chore-Time Equip., Inc. v. Cumberland Corp., 713 F.2d 774 (Fed. Cir. 1983) ..... 15
`
`KSR Int’l Co. v Teleflex Inc., 550 U.S. 398 (2007).................................................... 55
`
`Okajima v. Bourdeau, 261 F.3d 1350 (Fed. Cir. 2001) ............................................. 15
`
`Statutes
`
`35 U.S.C. § 312............................................................................................................. 1
`
`35 U.S.C. §102 ............................................................................................................. 6
`
`35 U.S.C. §103 ............................................................................................................. 6
`
`35 U.S.C. §311 ............................................................................................................. 1
`
`35 USC §112............................................................................................................... 27
`
`Rules
`
`37 C.F.R. § 42.104 ........................................................................................... 6, 26, 27
`
`37 C.F.R. § 42.22........................................................................................................ 27
`
`37 C.F.R. § 42.8............................................................................................................ 5
`
`37 C.F.R. §42.100...................................................................................................... 26
`
`37 C.F.R. §42.100 et seq. ............................................................................................. 1
`
`iv
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`

`
`IPR2016-01517
`Patent 7,134,505
`
`TABLE OF EXHIBITS
`
`Description
`U.S. Patent No. 7,134,505 (“the ’505 Patent”)
`A.B. Yost, II, et al. Production and Stimulation Analysis of Multiple
`Hydraulic Fracturing of a 2,000-ft Horizontal Well, SPE (Society for
`Petroleum Engineering) 19090 (1989) (“Yost”)
`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”)
`Declaration of Rebekah Stacha of the Society of Petroleum Engineers
`Affidavit of Roberto Pellegrino
`Declaration of Vikram Rao
`Transcript of Continued Deposition of Daniel Jon Themig – 01/08/2007
`Affidavit of Kevin Trahan
`Expert Report of Kevin Trahan
`First Supplemental Expert Report of Kevin Trahan
`Supplemental Engineering Report Prepared by Ronald A. Britton, P.E.
`U.S. Provisional Application No. 60/404,783
`U.S. Patent No. 3,062,291 to Brown
`U.S. Patent No. 2,738,013 to Lynes
`U.S. Patent No. 4,224,987 to Allen
`U.S. Patent No. 6,006,838 to Whiteley et al.
`Prosecution History of U.S. Patent No. 7,861,774
`Prosecution History of U.S. Patent No. 7,543,634
`Prosecution History of U.S. Patent No. 7,134,505
`Prosecution History of U.S. Patent No. 6,907,936
`U.S. Provisional Patent Application No. 60/331,491 filed on November
`19, 2001.
`Hart Petroleum Volume 71, Number 6, June 1998
`Declaration of Christopher D. Hawkes, Ph.D., P.Geo.
`Declaration of Carrie Anderson
`
`Exhibit
`1001
`1002
`
`1003
`
`1004
`
`1005
`1006
`1007
`1008
`1011
`1012
`1013
`1014
`1015
`1016
`1017
`1018
`1019
`1020
`1021
`1022
`1023
`1024
`
`1025
`1026
`1027
`
`5
`
`

`
`IPR2016-01517
`Patent 7,134,505
`Pursuant to 35 U.S.C. §§311 & 312 and 37 C.F.R. §42.100 et seq., Weatherford
`
`International, LLC; Weatherford/Lamb, Inc.; Weatherford US, LP; and Weatherford
`
`Artificial Lift Systems, LLC (“Petitioners”) request inter partes review of U.S.
`
`Patent No. 7,134,505 (the “’505 Patent,” Ex. 1001). The Board is authorized to
`
`deduct any required fees from Deposit Account 500916.
`
`I.
`
`INTRODUCTION
`
`As shown in annotated Fig. 1a below, the ‘505 Patent’s purported invention
`
`was a method for treating multiple zones in a horizontal “open hole” oil well with
`
`stimulating fluids, such as fracturing fluids, using multiple “solid body” packers [red]
`
`to isolate the well into multiple zones and ball-actuated sliding sleeves [blue] to open
`
`and close fluid injection ports in the tubing string:
`
`Petitioners’ primary references establish that these concepts are not patentable.
`
`1
`
`

`
`IPR2016-01517
`Patent 7,134,505
`For example, Thomson describes multi-zone fracturing, where each zone includes a
`
`multistage acid fracture (“MSAF”) ball-actuated sliding sleeve between two “solid
`
`body” packers: “[u]p to nine MSAF tools [blue] can be run in the completion with
`
`isolation of each zone being achieved by hydraulic-set retrievable packers [red]1 that
`
`are positioned on each side of an MSAF tool.” Ex. 1003 at 1. The configuration is
`
`shown in Thomson’s annotated Figure 3 below (see Ex. 1003 at 10):
`
`1 In this depiction, the packer on the left is a “permanent” packer and it is
`
`colored red simply to show a sliding sleeve between two packers. As the quote makes
`
`clear, the complete tubing string, which would extend to the right as shown in the
`
`annotated figure below, includes up to nine more retrievable packers.
`
`2
`
`

`
`IPR2016-01517
`Patent 7,134,505
`
`Ellsworth discloses, in the context of horizontal open hole stimulations, zonal
`
`isolation using sliding sleeves (blue) between multiple solid body packers (red), as
`
`shown in the annotated Figure 11 (see Ex. 1004 at 9):
`
`3
`
`

`
`IPR2016-01517
`Patent 7,134,505
`
`Yost also describes multi-zone stimulation of a horizontal open hole well
`
`using fracturing fluids by “installing 8 external casing packers (ECPs) [red] as an
`
`integral part of the 4-1/2 inch casing string along with 14 sliding sleeve ported
`
`collars [blue] which were used to provide access to the formation in lieu of
`
`perforations.” Ex. 1002 at 1-2. The arrangement is depicted in Yost’s annotated
`
`Figure 2 (see Ex. 1002 at 10):
`
`4
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`IPR2016-01517
`Patent 7,134,505
`
`II. MANDATORY NOTICES
`
`A.
`
`Real Party in Interest (37 C.F.R. § 42.8(b)(1))
`
`Weatherford International, LLC; Weatherford/Lamb, Inc.; Weatherford US, LP;
`
`and Weatherford Artificial Lift Systems, LLC are the real parties-in-interest.
`
`B.
`
`Related Matters (37 C.F.R. § 42.8(b)(2))
`
`The following matter may affect, or be affected by, a decision in this
`
`proceeding: Rapid Completions LLC v. Baker Hughes Incorporated et al., Civil
`
`Action No. 6:15-cv-724 (E.D. Tex. 2015) (the “Litigation”). Other parties to that
`
`litigation have filed IPR2016-00596, which addresses the ’505 Patent.
`
`C.
`
`Lead and Back-Up Counsel (37 C.F.R. § 42.8(b)(3))
`
`Lead counsel: Jason Shapiro (Reg. No. 35,354)
`
`Back-up counsel: Patrick Finnan (Reg. No. 39,189)
`
`D.
`
`Service Information (37 C.F.R. § 42.8(b)(4))
`
`Email: epatent@usiplaw.com
`
`Post:
`
`Edell, Shapiro & Finnan, 9801 Washingtonian Boulevard #750,
`
`5
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`

`
`IPR2016-01517
`Patent 7,134,505
`
`Gaithersburg, MD 20878
`
`Phone: 301-424-3640
`
`Fax: 301-762-4056
`
`Petitioners consent to electronic service.
`
`III. GROUNDS FOR STANDING
`
`Pursuant to 37 C.F.R. § 42.104(a), Petitioners certify that the ’505 Patent is
`
`available for inter partes review. Petitioners were served with the original complaint
`
`in the Litigation within the last 12 months and are not estopped from challenging the
`
`claims on the requested grounds.
`
`IV.
`
`STATEMENT OF PRECISE RELIEF REQUESTED FOR EACH
`CLAIM CHALLENGED
`
`A.
`
`Claims for Which Review Is Requested (37 C.F.R. § 42.104(b)(1))
`
`Petitioners request review and cancellation of ’505 Patent claims 23 and 27
`
`(the “Challenged Claims”).
`
`Statutory Grounds of Challenge (37 C.F.R. § 42.104(b)(2))
`B.
`Ground 1: The Challenged Claims are invalid under 35 U.S.C. §103(a) based
`
`on Thomson (Ex. 1003) in view of Ellsworth (Ex. 1004) and further in view of Yost
`
`(Ex. 1002). Thomson (published in 1997), Ellsworth (1999), and Yost (1989), are
`
`prior art under 35 U.S.C. §102(b) because each was published more than one year
`
`prior to November 19, 2001, the earliest priority date claimed in the ‘505 patent. Ex.
`
`1005 at ¶¶ 4-6; Ex. 1026 at ¶¶ 2-5; Ex. 1006 at ¶¶ 5-7.
`
`6
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`

`
`IPR2016-01517
`Patent 7,134,505
`Ground 1 is not cumulative to the grounds raised by other parties in IPR2016-
`
`00596 because it provides new evidence of unpatentability. For example, Ground 1
`
`relies on Patent Owner’s admissions in a prior litigation that are material
`
`to
`
`patentability and applies a different reference (Yost) showing multi-zone fracturing
`
`of horizontal open hole wellbores.
`
`V.
`
`FIELD OF TECHNOLOGY
`
`A.
`
`Drilling an Oil Well
`
`Drilling a well generally includes drilling a hole to construct a wellbore in a
`
`geological formation with oil or gas reserves. The wellbore may be lined with tubing
`
`that is cemented in place, sometimes referred to as “casing,” to protect the wellbore
`
`during production. Ex. 1007 at ¶ 40. In some circumstances, however, a wellbore
`
`may be left uncased (called an “open hole”) to “expose porosity and permit
`
`unrestricted wellbore inflow of petroleum products.” Ex. 1001 at 1:28-32; see also
`
`Ex. 1007 at ¶ 40. If a wellbore is cased, access to the formation is provided by
`
`“perforating” (i.e., creating openings in the casing) to allow oil and/or gas to flow
`
`from the formation into the wellbore. Ex. 1001 at 1:27-29. Whether there is a
`
`cemented casing or not, a tubing string is normally run into the wellbore to deliver
`
`tools, inject fluids, and/or provide a conduit for production. Id. at 1:38-43, 58-60.
`
`Prior Art Stimulation Techniques
`B.
`After drilling a well, it may need to be completed (e.g., through a stimulation
`
`7
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`IPR2016-01517
`Patent 7,134,505
`treatment) before production. Stimulation can involve pumping acid or other fluids
`
`into a wellbore under pressure. Ex. 1001 at 1:30-34. For example, fracturing fluids
`
`can be injected into the wellbore under pressure to propagate natural fractures and/or
`
`to induce and propagate new fractures.
`
`1.
`
`Thomson
`
`Thomson, published in 1997, discloses multi-stage fracturing in a horizontal
`
`cased well. Thomson states, “An innovative completion design that allows multiple
`
`acid fracs to be performed in horizontal subsea chalk-formation wells with a single
`
`trip into the wellbore has recently been codeveloped… .” Ex. 1003 at 1. The goal of
`
`this design was to allow “multiple acid stimulations” “to be efficiently performed in
`
`the shortest possible time.” Id. at 1.
`
`Thomson describes alternating hydraulically set packers (which in this case
`
`are an example of solid body packers) and MSAF tools (which are an example of
`
`ball-actuated sliding sleeves):
`
`The key element of the system is a multi-stage acid frac tool
`(MSAF) that is similar to a sliding sleeve circulating device and
`is run in the closed position. Up to 9 MSAF tools can be run in
`the completion with isolation of each zone being achieved by
`hydraulic-set retrievable packers that are positioned on each side
`of an MSAF tool. Each sleeve contains a threaded ball seat with
`the smallest ball seat in the lowest sleeve and the largest ball seat
`in the highest sleeve. With this system, stimulation of 10 separate
`
`8
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`IPR2016-01517
`Patent 7,134,505
`zones is accomplished in 12-18 hours by a unique procedure that
`lubricates varying sized low-specific gravity balls into the tubing
`and then pumps them to a mating seat in the appropriate MSAF,
`thus sealing off the stimulated zone and allowing stimulation of
`the next zone which is made accessible by opening the sleeve.
`This technique provided a substantial reduction in the operational
`time normally required to stimulate multiple zones and allowed
`the stimulations to be precisely targeted within the reservoir.
`
`Ex. 1003 at 1.
`
`As stated, Thomson’s system included “[u]p to 9 MSAF tools ... with ...
`
`hydraulic-set retrievable packers ... on each side.” Id. Referring to annotated and
`
`modified Figure 3 below, the lower end of such a tool string is shown with MSAF
`
`tool sizes taken from Table 1 (Ex. 1003 at 6, Table 1)2:
`
`2 Annotated Figure 3 of Ex. 1003 has been modified below to show a section
`
`of the up to 9 MSAF tools that can be run in the completion with isolation of each
`
`zone being achieved by hydraulic-set retrievable packers that are positioned on each
`
`side of an MSAF tool, with the MSAF tool sizes taken from Table 1 (Ex. 1003 at 6,
`
`Table 1).
`
`9
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`IPR2016-01517
`Patent 7,134,505
`
`Annotated and Modified Figure 3 of Thomson
`
`Thomson’s ball-drop actuated sliding sleeve is shown in both open and
`
`closed positions in annotated Figure 5 below. When in the closed position shown
`
`below, the sleeve closes a port in the tubing, and when in the open position, the
`
`port opens to allow communication between the tubing and the annulus:
`
`Id. at 12.
`
`Thus, Thomson discloses “single trip” multi-stage fracturing using the
`
`combination of hydraulic-set packers with compressible elements (which are an
`10
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`

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`IPR2016-01517
`Patent 7,134,505
`example of solid body packers) and ball-drop actuated sliding sleeves. Id. at 1.
`
`2.
`
`Ellsworth
`
`While Yost, described below, discloses inflatable packers, a POSITA knew
`
`that other options for sealing in open hole stimulations, including “solid body”
`
`packers, were available. One such solid body packer (or “SBP”) was the Wizard II
`
`packer, which was sold by Dresser/Guiberson and Halliburton in the late 1990s. Ex.
`
`1004 at 5; Ex. 1007 at ¶ 46.
`
`Ellsworth, published in 1999, was co-authored by Dan Themig, one of the
`
`‘505 named inventors and co-founder of Patent Owner (Packers Plus). Neither
`
`Patent Owner nor Mr. Themig disclosed Ellsworth to the Patent Office during the
`
`’505 patent prosecution. Ellsworth describes the use of Wizard II solid body packers
`
`in horizontal open hole for “stimulation”:
`
`inflatable packers were used for water shut-off,
`Historically,
`stimulation and segment testing. More recently, solid body packers
`(SBP’s) (see Figure 4) have been used to establish open hole isolation.
`These tools provide a mechanical packing element that is hydraulically
`activated. The objective of using this type of tool is to provide a long-
`term solution to open hole isolation without the aid of cemented liners.
`Although the expansion ratios for these packers are [sic: not] as large as
`for inflatables, the carbonate formation in Rainbow Lake generally drills
`very close to gauge hole, and effective isolation is possible with these
`SBP’s.
`
`11
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`IPR2016-01517
`Patent 7,134,505
`
`Ex. 1004 at 5 (emphasis added).
`
`Ellsworth’s Figure 4 is reproduced below. As shown, Figure 4 reiterates that
`
`the Wizard II is a “solid body packer … instead of inflatable,” and it identifies a
`
`“Five Piece Packing Element” actuated by a “Setting Cylinder”:
`
`Ex. 1004 at 5 (Figure 4).
`
`As shown in annotated Figure 11 in Section I above, Ellsworth also discloses
`
`zonal isolation using sliding sleeves between multiple solid body packers. Ex. 1004
`
`at 5 (“Between the sets of packers was a 73mm (2-7/8”) sliding sleeve”); see also id.
`
`at 7 (“A sliding sleeve was installed between the isolation points to allow an inflow
`
`point for the middle well interval.”). Ellsworth provides examples of using these
`
`solid body packers for stimulation. Id. at 7-8 (“Prior to running the production
`12
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`IPR2016-01517
`Patent 7,134,505
`assembly, SBP’s were run to acidize the toe of the well.... The initial acid job using
`
`SBP’s indicated that the tools successfully provided isolation during the job.”), 10
`
`(“Lateral #2 was produced with oil cuts of 35-50%. The leg was then acidized
`
`through the tubing string, and swabbed back.”); Ex. 1007 at ¶¶ 47-49.
`
`3.
`
`Yost
`
`Yost, published in 1989, notes that fracturing as a form of stimulation in
`
`horizontal wells has been used for decades: “The value of high angle drilling and
`
`multiple hydraulic fracturing from an inclined or horizontal borehole for
`
`maximizing production was recognized in 1969.” Ex. 1002 at 1. Yost describes
`
`multi-stage fracturing of horizontal open hole wells using packers for zonal isolation
`
`and ported sliding sleeves for injecting fracturing fluids:
`
`An alternative approach is zone isolation accomplished by the
`installation of external casing packers and port collars as an integral
`part of a casing string in the horizontal section. Such a completion
`arrangement
`provided
`stimulation
`intervals with
`ready-made
`perforations for injecting fracturing fluids in an open hole fracturing
`condition behind pipe. This was the method of completion used in this
`2000 foot horizontal well to avoid the problems of formation damage
`associated with cementing and to eliminate the need for tubing-
`conveyed perforating of numerous treatment intervals.
`
`Ex. 1002 at 1 (emphasis added); see also id. at 2 (referencing “sliding sleeve ported
`
`13
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`

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`IPR2016-01517
`Patent 7,134,505
`collars” between packers); Ex. 1007 at ¶¶ 43-45. The Yost “external casing packers”
`
`are inflatable. Ex. 1002 at 2; Ex. 1007 at ¶ 44.
`
`Annotated Figure 2 of Yost showing the sliding sleeve ports and packers that
`
`isolate the different zones is reproduced below.
`
`Ex. 1002 at 10.
`
`This configuration created seven “separate open hole zones” (because one
`
`packer, located between originally expected zones 2 and 3, failed to inflate). Id. at 2.
`
`“A combination straddle tool was designed to facilitate the opening and closing of
`
`port collars” in these seven zones. Id. In the open position, the sliding sleeve ported
`
`collars provided “ready-made perforations” (i.e., ports) that were used to inject
`
`fracturing fluids into the wellbore. Id. at 1-2. Yost also presents results for a 4 ½”
`
`tubing string in a 7 7/8” horizontal open hole showing that the sliding sleeve ported
`
`collars and packers were effective in achieving isolation between the seven separate
`
`14
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`IPR2016-01517
`Patent 7,134,505
`
`zones. Ex. 1002 at 9 (Table 7) and Fig. 2; Ex. 1007 at ¶ 44.
`
`Accordingly, as early as 1989, persons of ordinary skill in the art (“POSITA”)
`
`knew that horizontal open hole wells could be isolated and fractured using packers
`
`and ported sliding sleeves. Ex. 1007 at ¶ 45.
`
`VI.
`
`LEVEL AND KNOWLEDGE OF POSITA
`
`A.
`
`Level of Ordinary Skill
`
`A POSITA as of November 19, 2001—the earliest priority date claimed—
`
`would have had at least a Bachelor of Science degree in mechanical or petroleum
`
`engineering or a similar technical discipline, such as metallurgy or material science
`
`and engineering and at least 3 years of experience with oil or gas well drilling
`
`and completion operations or in technical support of such operations. Ex. 1007 at
`
`¶ 38-39. Additional education in a relevant technical discipline can compensate for
`
`less experience in the relevant field and vice versa. Id. This level of ordinary skill
`
`is evidenced by prior art and the ’505 Patent. Id. at ¶¶ 43-67; Chore-Time Equip.,
`
`Inc. v. Cumberland Corp., 713 F.2d 774, 779 (Fed. Cir. 1983); Okajima v.
`
`Bourdeau, 261 F.3d 1350, 1355 (Fed. Cir. 2001).
`
`B.
`
`A POSITA Knew of Available Combinations of Completion Tools
`
`The prior art described in Section V above establishes that a POSITA would
`
`have been familiar with various completion/stimulation techniques. Ex. 1007 at ¶¶
`
`43-56. Specifically, by the late 1990s, a POSITA understood that fluid treatment,
`
`15
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`IPR2016-01517
`Patent 7,134,505
`including fracturing in horizontal open hole or cased wells could include both some
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`type of packer for zonal isolation and some form of ported sleeve or port for
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`injection into the isolated zones. A POSITA further understood that a selection of
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`tools were available for performing the zonal isolation, including inflatable packers
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`(e.g., Yost’s ECP packers) and SBPs (e.g., Ellsworth’s Wizards and Thomson’s
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`hydraulic-set packers). Similarly, a POSITA understood that a selection of tools was
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`also available for providing the injection capability, including sliding sleeve ported
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`collars (e.g., Yost), coiled tubing or wireline actuated sliding sleeves (e.g.,
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`Ellsworth), and ball-drop actuated sliding sleeves (e.g., Thomson’s MSAF tool).
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`A POSITA also knew that inflatable packers were not always preferable, and
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`in some circumstances, hydraulically-set SBPs would be preferable in cased and
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`open hole wells. See, e.g., id. ¶¶ 46-56; see also Ex. 1004 at 5 (“Historically,
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`inflatable packers were used [but] [m]ore recently, solid body packers (SBP’s) (see
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`FIG. 4) have been used to establish open hole isolation.”).
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`C.
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`Patent Owner Admissions: A POSITA Knew that Cased Hole
`Tools/Systems Could be Used in Open Hole
`A POSITA further understood that many tools (e.g., packers and sliding
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`sleeves) and systems (e.g., completion systems) initially designed for or used with
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`cemented casing could also be used in open hole and that such use in open hole is
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`not a patentable advancement. Ex. 1007 at ¶¶ 57. In fact, Patent Owner, through its
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`named inventor (Mr. Themig) and its technical experts from a prior litigation
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`Patent 7,134,505
`(Messrs. Britton and Trahan), has made repeated admissions to this effect. These
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`admissions bear directly on the issues raised in this petition. For example, the
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`admissions establish that a POSITA would know that the cased hole system of
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`Thomson could be used successfully in open hole.
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`As background, Patent Owner was accused of trade secret misappropriation in
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`a litigation brought by Halliburton Energy Services, Inc. regarding some of the
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`technology claimed in the ’505 Patent. During that litigation, Mr. Themig testified
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`on behalf of Patent Owner about his prior employment at Dresser/Guiberson before
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`2000, during which time it became known to use cased hole tools in open hole:
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`Q: So are the design features of [Packer Plus’ RockSeal] IIS a
`“first” for the oil and gas industry?
`A:
`Not necessarily.
`Q: Why is that?
`A: Well, part of the thing about the compression set elements
`is, when I was at Guiberson, we learned that we could just take cased-
`hole packers and put them in the open hole, and they would
`function and they would work.
`So the tandem hydraulic was never built for cased hole -–or
`sorry, it was never built for open hole. But when we first decided to try
`hydraulics at open-hole packers, we learned that we could set them in
`open hole and that they would isolate and they would function. So
`the elements were designed for casing, but they worked in open
`hole.
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`When we designed the Wizard packer, which I was
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`Patent 7,134,505
`involved in, we took all cased-hole elastomers and put them on a
`hydraulic cylinder and we ran them, and again, they functioned in open
`hole.
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`***
`So, basically, as far as what we had discovered, I guess,
`was that anything that we could run in casing, we could also run in
`open hole, and it would function provided the open hole was
`competent.
`You said anything that you run in casing can function
`Q:
`in open hole, correct?
`Provided that the formation is competent.
`A:
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`Ex. 1008 at 498:12-500:1 (emphasis added).
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`Mr. Themig further testified that he expected the RockSeal, the preferred
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`embodiment SBP in the ’505 Patent, to be successful because of the pre-2000
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`success in open hole of the Wizard SBP. Ex. 1008 at 573:8-24. The Wizard packer
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`success is reflected in Ellsworth, which Mr. Themig co-authored but failed to
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`disclose to the Patent Office.
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`These admissions illustrate that a POSITA would know to use cased hole tools
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`like those found in Thomson in open hole. This very point was repeatedly confirmed
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`by Patent Owner’s technical expert, Mr. Trahan, in the prior Halliburton litigation.
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`Of interest, Mr. Trahan later became the CTO of Patent Owner and is currently the
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`COO. For example, during prosecution of US Patent No. 7,861,774 (a patent which
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`also claims priority to the same provisional applications
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`Patent 7,134,505
`(60/404,783 and
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`60/331,491) that the ‘505 patent claims priority to), Patent Owner submitted in an
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`IDS a declaration of Mr. Trahan from the Halliburton litigation. Ex. 1020 at 35
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`(Doc. KKKKK). Opining on what was “understood” as of 1999, Mr. Trahan (on
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`behalf of Patent Owner) testified as follows in his declaration:
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`I am an expert in the field of oil and gas well drilling and
`completion technology.
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`* * *
`Packing Elements of many different configurations have been
`It is a fact that packing
`used in cased hole as well as open hole....
`elements which were initially designed for cased hole have been
`used in open hole. . . .
`Reliability is largely dependent on the
`competence of the open hole formation in which the packer is set. . . .
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`Ex. 1011 at ¶¶ 2, 9.
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`Similarly, Mr. Trahan signed an expert report on behalf of Patent Owner in
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`which he acknowledged the long history of using cased hole tools in open hole,
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`which he deemed to be an “obvious,” i.e., non-patentable, application:
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`Cased hole tools, including packers, have been used in open hole
`applications for many years. In my opinion use of a tool with Rockseal
`type features in open hole does not pass the patentability standard of
`novelty or nonobviousness. The open hole application of tools that
`were originally designed for cased hole has been common place in
`the industry since I began working in the industry in 1992. There is
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`nothing novel or nonobvious about such an application.
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`Ex. 1012 at 10-11 (emphasis added).
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`Mr. Trahan reconfirmed these same points in his supplemental expert report
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`on behalf of Patent Owner:
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`The hard rock formations, once drilled, typically provide a
`circular cross section conduit, just as a cased hole does. In these
`types of hard formations a tool that was designed for use in cased
`hole may be used in open hole. The fact is that many tools, including
`anchoring mechanisms and packing elements, that were initially
`designed for cased hole, with no contemplation of being used in
`open hole, have been used in open hole successfully. It is a fact that
`many tools which utilized compression set elastomeric solid packing
`elements have been used in open hole. . . . In fact this is exactly what
`Guiberson/Halliburton has done successfully for many years by use of
`its original Wizard type packer designs. . . .
`Ex. 1013 at 5 (emphasis added); see also id. at 12 (“Compression set elements have
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`long been used in both cased hole and open hole applications.”).
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`Finally, Patent Owner’s other expert, Mr. Britton, made the same admissions
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`on behalf of Patent Owner. Based on his “years of direct field experience in the
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`operational side of the oil and gas industry” (Ex. 1014 at 3), Mr. Britton signed an
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`expert report stating:
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`Many tools that were originally designed as cased hole tools can
`and have been used in open hole situations. . . . In many deep hole
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`situations, a deep open hole acts in the same manner as a cased hole.
`Consequently, many of
`the
`tools designed for
`cased hole
`applications would be used in open hole applications.
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`Ex. 1014 at 4-5 (emphasis added)
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`Accordingly, during the Halliburton litigation, Patent Owner expressed the view
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`many times that it was well known before 2000 that many open hole wellbores act in
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`the same manner as a cased hole, and therefore, the use of cased hole tools in open
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`hole was “common place” and not patentable.
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`VII.
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`THE ’505 PATENT
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`As annotated in Figure 1a below, the 505 Patent depicts an open hole wellbore
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`12 drilled through a formation 10 and a tubing string assembly run in the wellbore.
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`Id. at 6:8-16; 10:34-38.
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