Paper No. 20
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`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. IPR2017-01236
`Patent 9,303,501
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`_
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`PETITIONERS' REPLY
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`
`
`TABLE OF AUTHORITIES
`
`IPR2017-01236
`Patent 9,303,501
`
`Brown & Williamson Tobacco Corp. v. Philip Morris, 229 F. 3d 1120 (Fed. Cir. 2000)
`
` ................................................................................................................................. 17
`
`ClassCo, Inc. v. Apple, Inc., 838 F. 3d 1214 (Fed. Cir. 2016) .................................... 14
`
`Constant v. Advanced Micro-Devices, Inc., 848 F.2d 1560 (Fed. Cir. 1988) .............. 7
`
`Graham v. John Deere Co. of Kansas City, 383 US 1, 36 (1966) .............................. 11
`
`Harari v. Lee, 656 F.3d 1331 (Fed. Cir. 2011) ............................................................. 2
`
`In re Applied Materials, Inc., 692 F. 3d 1289 (Fed. Cir. 2012) .................................. 13
`
`In re Hall, 781 F.2d 897 (Fed. Cir. 1986) ..................................................................... 7
`
`KSR Int'l Co. v. Teleflex Inc., 550 U.S. 398 (2007) ..................................................8, 9
`
`Merck & Co. v. Teva Pharms. USA, Inc., 395 F.3d 1364 (Fed. Cir. 2005) ................ 17
`
`Ormco Corp. v. Align Tech., Inc., 463 F.3d 1299 (Fed. Cir. 2006) ............................ 16
`
`Paice LLC v. Ford Motor Company, 881 F.3d 894 (Fed. Cir. 2018) ........................... 2
`
`Power-One, Inc. v. Artesyn Technologies, Inc., 599 F. 3d 1343 (Fed. Cir. 2010) ..... 18
`
`Tokai Corp. v. Easton Enters., Inc., 632 F.3d 1358 (Fed. Cir. 2011) ......................... 12
`
`W. Union Co. v. MoneyGram Payment Sys., Inc., 626 F.3d 1361 (Fed. Cir. 2010) ... 12
`
`Wyers v. Master Lock Co., 616 F.3d 1231 (Fed. Cir. 2010) ....................................... 12
`
`
`
`
`
`ii
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`

`

`
`TABLE OF CONTENTS
`
`IPR2017-01236
`Patent 9,303,501
`
`
`I. 
`
`INTRODUCTION ............................................................................................ 1 
`
`II.  CLAIM CONSTRUCTION ............................................................................. 2 
`
`III.  THE CLAIMS ARE INVALID ....................................................................... 3 
`
`A. PO Is Collaterally Estopped from Asserting Patentability of the '501 Claims
`
`
`
`3 
`
`B.  Halliburton Is a Prior Art Printed Publication ........................................... 6 
`
`C.  PO's Admissions Establish the Obviousness of Using Thomson in Open
`
`Hole
`
`7 
`
`D. PO's Criticisms of Ellsworth Are Irrelevant ............................................ 10 
`
`E.  Dependent Claims Are Invalid ................................................................ 11 
`
`F.  PO's Secondary Consideration Evidence Fails ........................................ 11 
`
`1.  The Secondary Consideration Arguments Are Moot ........................ 11 
`
`2.  PO's Commercial Success Evidence Fails ......................................... 12 
`
`3.  There is No Nexus to the Claims ....................................................... 13 
`
`4.  The Alleged Commercial Success Is Unrelated to the Claimed Methods
`
`
`
`16 
`
`G. PO's Conventional Wisdom and Surprising Results Arguments Fail ..... 16 
`
`H. PO's Industry Praise Arguments Fail ....................................................... 18 
`
`I.  PO's Copying Argument Fails ................................................................. 19 
`
`iii
`
`

`

`
`IV.  CONCLUSION ............................................................................................... 20
`
`IV. CONCLUSION ............................................................................................... 20
`
`IPR2017-01236
`
`IPR2017-01236
`Patent 9,303,501
`Patent 9,303,501
`
`
`
`
`
`iv
`
`iV
`
`

`

`
`EXHIBIT LIST
`
`
`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
`
`IPR2017-01236
`Patent 9,303,501
`
`Description
`
`U.S. Patent No. 9,303,501 ("the '501 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
`v
`
`

`

`
`Exhibit
`1028
`
`1029
`
`1030
`1031
`1032
`1033
`1034
`
`1035
`1036
`1037
`1038
`
`1039
`1040
`1041
`
`1042
`
`1043
`
`1044
`
`1045
`
`1046
`
`1047
`
`1048
`
`IPR2017-01236
`Patent 9,303,501
`
`(1997)
`
`Description
`
`Halliburton Completion Products, Second Edition
`("Halliburton")
`Affidavit of Aileen Barr of Halliburton Energy Services, Inc.,
`regarding Halliburton Completion Products, Second Edition (1997)
`Prosecution History of U.S. Patent No. 9,303,501
`Prosecution History of U.S. Patent No. 8,397,820 (including patent)
`Prosecution History of U.S. Patent No. 8,746,343 (including patent)
`Prosecution History of U.S. Patent No. 9,366,123 (including patent)
`Overbey et al., Drilling, Completion, Stimulation, and Testing of
`Hardy HW#1 Weil, Putnam County, West Virginia
`U.S. Patent No. 6,253,856 to Ingram et al.
`U.S. Patent No. 5,947,204 to Barton
`U.S. Patent No. 4,330,039 to Vann et al.
`Notice of Deposition in No. CV-44,964 in the 238th Judicial District
`Court of Midland County, Texas (Served, Not Filed)
`Declaration of Richard S. Carden (Served, Not Filed)
`Declaration of Steven D. Shapiro (Served, Not Filed)
`“Energy Research Abstracts,” Vol. 18, No. 3, ISSN: 0160-3604,
`March 1993 (Served, Not Filed)
`Patrick J. McLellan, et al., A multiple-zone acid stimulation
`treatment of a horizontal well, Midale, Saskatchewan, THE JOURNAL
`OF CANADIAN PETROLEUM TECHNOLOGY, Vol. 31, No. 4, April 1992,
`at 71 ("McLellan")
`C.M. Kim & H.H. Abass, Hydraulic facture initiation from
`horizontal wellbores: Laboratory experiments, in ROCK MECHANICS
`AS A MULTIDISCIPLINARY SCIENCE: PROCEEDINGS OF THE 32ND US
`SYMPOSIUM ON ROCK MECHANICS, 231(Jean-Claude Roegiers ed.,
`CRC Press 1991) ("Kim and Abass")
`Reply Declaration of Vikram Rao in IPR2016-01509 (IPR2016-
`01509 Exhibit No. 1035)
`Transcript of February 28, 2017 Deposition Testimony of Harold R.
`McGowen III
`Errata Sheet for Transcript of February 28, 2017 Deposition
`Testimony of Harold R. McGowen III
`Transcript of July 26, 2017 Deposition Testimony of Harold R.
`McGowen III
`Naturalgasintel.com, Information on the Upper Devonian/Huron
`Shales,
`Natural
`Gas
`Intelligence,
`http://www.naturalgasintel.com/udhinfo (last visited August 13,
`vi
`
`

`

`IPR2017-01236
`Patent 9,303,501
`
`
`
`Description
`
`2017)
`W.K. Overbey, et al., Inducing Multiple Hydraulic Fractures From
`a Horizontal Wellbore, SPE (Society for Petroleum Engineering)
`18249 (1988)
`
`
`Exhibit
`
`1049
`
`
`
`
`
`
`vii
`
`

`

`
`
`I.
`
`INTRODUCTION
`
`IPR2017-01236
`Patent 9,303,501
`
`The Board previously held that all challenged claims of related U.S. Patent No.
`
`7,861,774 ("'774 patent") were unpatentable on essentially the same ground asserted in
`
`the present IPR. Weatherford Int’l, LLC v. Packers Plus Energy Servs. Inc., IPR2016-
`
`01509, Paper 62 (P.T.A.B. Feb. 22, 2018) ("'774 Opinion"). Patent Owner ("PO")
`
`agrees that the '501 claims challenged in this IPR are largely identical to the '774 claims.
`
`Because PO does not assert that the '501 claims are patentably distinct from the ’774
`
`claims previously held invalid by the Board in a final written decision, PO is
`
`collaterally estopped from asserting patentability of the '501 claims challenged in this
`
`IPR.
`
`Even if PO were not collaterally estopped from asserting validity of the
`
`challenged claims, the crux of PO's Response ("POR") is that cemented casing was
`
`required in 2001 for multistage fracturing because a POSITA would have been fearful
`
`of open-hole fracturing due to the possibility of "complex fracture geometries"
`
`spreading across multiple zones. POR at 13-18. The Board has already rejected PO's
`
`contention on the same record presented in this proceeding. '774 Opinion at 29 ("A
`
`person of ordinary skill in the art also would have known that there existed
`
`circumstances in which open hole multi-stage fracing might also be successful."). Yost
`
`and other references document that multi-stage open-hole fracturing was prevalent by
`
`2001, and Yost expressly states fracturing across multiple zones is beneficial.
`1
`
`

`

`IPR2017-01236
`Patent 9,303,501
`
`Additionally, PO's secondary indicia evidence is weak, at best, and cannot overcome
`
`the strong prima facie case of obviousness. Id. at 57 ("[W]e determine that evidence of
`
`obviousness is the most convincing evidence in the record."); see also id. at 62.
`
`II. CLAIM CONSTRUCTION
`The broadest reasonable interpretation of "solid body packer" ("SBP") is the
`
`definition in PO's Provisional Application No. 60/404,783 to which the '501 patent
`
`claims priority. Ex. 1001 at 18 (1:7-25); Ex. 1015 at 4. The provisional application is
`
`incorporated by reference in the '501 specification at 1:24-25. The '501 specification
`
`explicitly states that the '501 Patent "claims priority to (i) U.S. Provisional Application
`
`No. 60/331,491, filed Nov. 19, 2001, and (ii) U.S. Provisional Application No.
`
`60/404,783, filed Aug. 21, 2002." And that "Each of these applications is incorporated
`
`by reference herein." Ex. 1001 at 18 (1:24-25). This claim identifies with detailed
`
`particularity the specific material incorporated (Provisional Application No.
`
`60/404,783, and not just particular portions thereof) and where the material can be
`
`found (Provisional Application No. 60/404,783). Such language is plainly sufficient
`
`to incorporate the priority application in its entirety. Paice LLC v. Ford Motor
`
`Company, 881 F.3d 894, 907 (Fed. Cir. 2018) ("The sentence identifies with detailed
`
`particularity the specific material subject to incorporation (Severinsky, and not just
`
`particular portions thereof) and where that material can be found (U.S. Patent No.
`
`5,343,970)."); see also Harari v. Lee, 656 F.3d 1331, 1335-36 (Fed. Cir. 2011) (prior
`2
`
`

`

`IPR2017-01236
`Patent 9,303,501
`
`applications were incorporated in their entirety based on "broad and unequivocal
`
`language": "'The disclosures of the two applications are hereby incorporate[d] by
`
`reference'"). PO offers no reason why its express definition of SBP was not
`
`incorporated by reference, and no basis for not adopting its express definition in the
`
`present proceeding.
`
`III. THE CLAIMS ARE INVALID
`A.
`PO Is Collaterally Estopped from Asserting Patentability of the '501
`Claims
`
`PO asserted before the Board that claims 1, 3-7, 9-10, 12, and 16 in the related
`
`'774 patent were nonobvious over Thomson in view of Ellsworth in Petitioners' prior
`
`IPR challenge. The Board held that Petitioners had shown that all challenged '774
`
`claims were unpatentable over Thomson in view of Ellsworth. '774 Opinion at 62.
`
`PO admits that the challenged claims of the '501 patent are largely identical to
`
`the '774 challenged claims. POR at 3 ("The independent claim of the '501 patent is
`
`similar to the independent claim of U.S. Patent No. 7,861,774 except that the '501
`
`claim adds narrowing limitations related to a hydraulically actuated sleeve."). PO does
`
`not argue that the addition of the hydraulically actuated sleeve adds patentable
`
`significance to the '501 claims. Instead, PO repeats the very same arguments raised in
`
`PO's response to the '774 IPR relating to the alleged nonobviousness of open hole
`
`fracturing, which have now been rejected by the Board in a final written decision. '774
`
`3
`
`

`

`IPR2017-01236
`Patent 9,303,501
`
`Opinion. PO identifies the “key issue in this proceeding” relating to obviousness in
`
`the same manner as it did in the '774 IPR without any reference to the hydraulically
`
`actuated sleeve limitations. Compare POR at 23 with IPR2016-01509, Paper 33, at 20
`
`(P.T.A.B. May 31, 2017).
`
`Because the Board rejected PO's contentions of both law and fact on a
`
`substantially identical record to that presented here, PO is collaterally estopped from
`
`asserting validity of the '501 claims as well as collaterally estopped from asserting
`
`anything contrary to the Board’s findings of fact or conclusions of law in the prior '774
`
`Opinion. MaxLinear, Inc. v. CF CRESPE LLC, 880 F.3d 1373, 1376 (Fed. Cir. 2018)
`
`("B & B Hardware[, Inc. v. Hargis Industries, Inc., 135 S. Ct. 1293, 1303 (2015),] is
`
`particularly relevant here, as the Court held that 'issue preclusion should apply' to the
`
`final written decision of the Trademark Trial and Appeal Board ('TTAB').").
`
`Moreover, "'precedent does not limit collateral estoppel to patent claims that are
`
`identical . . . . If the differences between the unadjudicated patent claims and
`
`adjudicated patent claims do not materially alter the question of invalidity, collateral
`
`estoppel applies.'" Id. at 1377 (quoting Ohio Willow Wood Co. v. Alps South, LLC, 735
`
`F.3d 1333, 1342 (Fed. Cir. 2013)). In MaxLinear the Federal Circuit remanded an IPR
`
`decision holding that all challenged claims were not unpatentable to the Board for
`
`reconsideration in view of the preclusive effect of an intervening decision holding the
`
`independent claims invalid in a different IPR proceeding. The Federal Circuit stated:
`
`4
`
`

`

`
`
`IPR2017-01236
`Patent 9,303,501
`On remand, the Board must consider whether the dependent claims
`4, 6-9, and 21 can survive the unpatentability of claims 1 and 17 from
`which they depend in view of the prior art cited in the '728 IPR. The Board
`must decide whether the remaining claims present materially different
`issues that alter the question of patentability, making them patentably
`distinct from claims 1 and 17.
`
`Id. at 1377-78. Here, PO has not argued that the additional hydraulically actuated
`
`sleeve limitations of the '501 claims render them patentably distinct from the largely
`
`identical and invalid '774 claims. Nor could PO credibly make such an argument. Even
`
`if the invalidity of the '774 claims did not preclude validity of the '501 claims, the
`
`factual and legal decisions necessary to the Board’s decision on the '774 claims are
`
`preclusive. Sam Remo Hotel, L.P. v. City & County of San Francisco, 545 U.S. 323,
`
`336 n.16 (2005) ("Under collateral estoppel, once a court has decided an issue of fact
`
`or law necessary to its judgment, that decision may preclude relitigation of the issue
`
`in a suit on a different cause of action involving a party to the first case.").
`
`The only arguments PO makes based on the additional hydraulically actuated
`
`sleeve limitations are that Halliburton does not teach that the hydraulic sleeve could
`
`be used for open hole, multistage fracturing and that the Halliburton reference teaches
`
`that the Mirage Disappearing Plug solves the problems identified by Thomson. POR
`
`at 59.
`
`With respect to the first argument, Petitioners' evidence, which is unrefuted by
`
`PO, shows that it would have been obvious to a person of ordinary skill to use the
`
`Halliburton hydraulic sleeve in this application. Ex. 1007 at ¶¶ 45, 56-62, 69-70, 84,
`5
`
`

`

`IPR2017-01236
`Patent 9,303,501
`
`143-44. PO offers no evidence to the contrary. Halliburton expressly states, “The
`
`Halliburton pump open plug is a positive plug that holds pressure from either direction
`
`but can be pumped open by applying excess surface pressure.” Ex. 1028 at 93. That
`
`is precisely the purpose for which it would be used in Thomson’s system. Moreover,
`
`the Board has previously found that "combining the tools and techniques disclosed in
`
`the prior art was not difficult and was within the level of ordinary skill in the art." '774
`
`Opinion at 57.
`
`PO's second argument that Halliburton teaches that the Mirage Disappearing
`
`Plug solves the problems identified by Thomson, even if true, shows only that it would
`
`also have been obvious to use the Mirage Disappearing Plug with the Thomson system.
`
`It does not show that it would not have been obvious to use the Halliburton hydraulic
`
`sleeve in the system of Thomson.
`
`B. Halliburton Is a Prior Art Printed Publication
`PO makes the nonsensical assertion that the Halliburton reference (Halliburton's
`
`1997 product catalog (Ex. 1028)) is not a printed publication even though Petitioners'
`
`declaration, Ex. 1029, plainly states, "The 1997 Catalog was available to any customer
`
`or potential customer, as well as others, seeking a copy in 1997." Ex. 1029 at ¶ 4. The
`
`declaration goes on to explain how "Halliburton, as a regular practice and in the normal
`
`course of its business, prints these types of product catalogs every few years, including
`
`the 1997 Catalog, and disseminates them to customers and/or potential customers from
`
`6
`
`

`

`IPR2017-01236
`Patent 9,303,501
`
`the year they are printed until the next edition is printed." Id. There is no contrary
`
`evidence in the record. The Halliburton reference is therefore a prior art printed
`
`publication. Orion IP, LLC v. Hyundai Motor Am., 605 F.3d 967, 974-75 (Fed. Cir.
`
`2010) ("[T]he Electronic Parts Catalog promotional publication, as embodied by the
`
`IDB2000 system, qualifies as a prior art printed publication because it was accessible
`
`to those interested in the business of auto parts prior to November 10, 1988."); see also
`
`Constant v. Advanced Micro-Devices, Inc., 848 F.2d 1560, 1568-69 (Fed. Cir. 1988)
`
`("Evidence of routine business practice can be sufficient to prove that a reference was
`
`made accessible before a critical date."); In re Hall, 781 F.2d 897, 899 (Fed. Cir. 1986)
`
`("The probative value of routine business practice to show the performance of a
`
`specific act has long been recognized. Therefore, we conclude that competent evidence
`
`of the general library practice may be relied upon to establish an approximate time
`
`when a thesis became accessible." (internal citations omitted)).
`
`C.
`
`PO's Admissions Establish the Obviousness of Using Thomson in
`Open Hole
`
`Petitioners assert obviousness based on Thomson in view of Ellsworth and
`
`Halliburton. The Petition establishes and PO concedes that Thomson's multistage
`
`horizontal fracturing system and method is identical to the claimed features with two
`
`exceptions: (1) Thomson was run in cased-hole instead of the claimed open-hole
`
`application, and (2) Thomson used a pump-open plug and cycle plug instead of the
`
`claimed hydraulically actuated sliding sleeve at the toe of the tubing string. Petition
`7
`
`

`

`IPR2017-01236
`Patent 9,303,501
`
`at 43-67; Ex. 1045 at 65:5-9, 17-25. The Petition cites evidence providing reasons and
`
`motivations to use Thomson's system in open-hole, including the saved time and
`
`expense described in Thomson and the reduced cost of not casing and cementing
`
`described in Ellsworth. Petition at 40-43. Such a substitution would have been
`
`obvious to try and would have yielded nothing more than predictable results,
`
`particularly in light of Ellsworth's teaching that SBPs provide zonal isolation for
`
`stimulation procedures in open-hole wells. See, e.g., Ex. 1004 at 5.
`
`PO concedes as much because the only part of Thomson's system that knows
`
`whether it is in an open-hole well is the packer. Ex. 1007 ¶ 72. But, as the Petition
`
`notes, PO's prior expert offered the stunning admission that (i) "[t]he open hole
`
`application of tools [e.g., packers] that were originally designed for cased hole has
`
`been commonplace in the industry since" 1992 and (ii) "[t]here is nothing novel or
`
`nonobvious about such an application." Ex. 1012 at 10-11. Rather than refute this
`
`admission, PO's Response confirms it: "[T]he Halliburton litigation materials merely
`
`show that it might have been obvious to use a solid body packer for some purposes
`
`and in some wells, depending upon the specific proposed application." POR at 20.
`
`But if it would have been obvious to use Thomson's system, with its SBPs, in any
`
`open-hole well, the challenged claims are invalid. KSR Int'l Co. v. Teleflex Inc., 550
`
`U.S. 398, 419 (2007) ("If the claim extends to what is obvious, it is invalid under
`
`§ 103.").
`
`8
`
`

`

`IPR2017-01236
`Patent 9,303,501
`
`PO attempts to overcome this predicament by framing the "key issue" as
`
`"whether it was obvious to remove casing, cement and perforating from the
`
`conventional practice and then use solid body packers in combination with ball-
`
`activated sliding sleeves to perform the patented method of open hole multi-stage
`
`fracturing." POR at 23. Again, the only part of that "key issue" that Thomson does
`
`not disclose is "remove casing, cement and perforating," which is all subsumed in open
`
`hole. When PO concedes that it would have been obvious to use an SBP in open-hole
`
`"for some purposes and in some wells," that is sufficient to establish obviousness.
`
`Thomson teaches the "purpose" of using its multistage fracturing system, which is to
`
`save time in fracturing. Ex. 1003 at 1. Yost teaches open-hole, multistage fracturing.
`
`Ex. 1002 at 1. Additionally, Ellsworth teaches using SBPs for zonal isolation in open-
`
`hole to save the time and expense of cementing casing. Ex. 1004 at 5. If a POSITA
`
`in 2001 would have known that SBPs work (i.e., will seal) in some open-hole wells,
`
`as PO admitted and now concedes and as taught by Ellsworth, then it would have been
`
`obvious to use Thomson's system in at least some of those wells.
`
`Additionally, PO's contention that fracturing in open-hole raised various
`
`concerns is contradicted by Yost, as detailed below. When multistage fracturing with
`
`packers involved the choice between cased-hole and open-hole fracturing, choosing
`
`either option would have been obvious. KSR, 550 U.S. at 421 ("When there is a design
`
`need or market pressure to solve a problem and there are a finite number of identified,
`
`9
`
`

`

`IPR2017-01236
`Patent 9,303,501
`
`predictable solutions, a person of ordinary skill has good reason to pursue the known
`
`options within his or her technical grasp.").
`
`PO further asserts that a POSITA would find the problems Thomson identified
`
`"alarming," relying on its expert. POR at 52-53. But when asked why a service
`
`company, like Halliburton, would publish SPE papers, Mr. McGowen stated, "Increase
`
`sales." Ex. 1047 at 31:6-9. It is not credible that Halliburton would tarnish its
`
`reputation by publishing three different papers (OTC 8472, SPE 37482, SPE 51177),
`
`including one peer-reviewed publication in the SPE Drilling & Completion Journal,
`
`and presenting those papers at conferences, if the papers described something
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`"alarming" to a POSITA. In PO's own words, "After all, the authors were from
`
`Halliburton and Philips, two of the most highly-regarded and technically savvy
`
`organizations in the oil and gas industry." POR at 52.
`
`The evidence, including PO's admissions, shows that although risks exist in any
`
`completion system, a POSITA would have understood that using Thomson's system
`
`in open-hole was likely to be successful in at least "some wells." For the very few
`
`problems Thomson reported, Thomson reported solutions. Ex. 1044 ¶¶ 3-5. Indeed,
`
`Thomson emphasized both the success of the system and the cost savings due to
`
`reduced fracturing time. Ex. 1003 at 1, 5. There is nothing "alarming" in Thomson.
`
`PO's Criticisms of Ellsworth Are Irrelevant
`
`D.
`PO's detailed discussion of how Ellsworth allegedly fails to teach fracturing
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`(POR at 53-55) is irrelevant as Ellsworth has not been relied upon for fracturing. See,
`
`e.g., Petition at 21-24, 41-43, 44-46, 48-49, 53-54, 56-59. Ellsworth is relied upon to
`
`show, inter alia, that it was known to stimulate in open holes using SBPs for zonal
`
`isolation in a system like Thomson’s, and to use a pump-out plug at the bottom of the
`
`tubing string when running packers for zonal isolation. Id. Ellsworth is also relied upon
`
`to show that it was known to run packers in the well unset and to pressure up against
`
`an openable device to set them. E.g. Petition at 57-59, 62-64. It is undeniable that
`
`Ellsworth teaches zonal isolation for the stimulation (e.g., acidizing) of open-hole
`
`wellbores using SBPs, and teaches that such packers are a known alternative to
`
`inflatables. See, e.g., Ex. 1004 at 5-8; Petition at 23-24.
`
`E. Dependent Claims Are Invalid
`PO does not argue that any dependent claim is separately patentable over '501
`
`claim 1. Thus, for all the reasons expressed in the Petition and in the '774 Opinion,
`
`dependent claims 2-9 are unpatentable as well.
`
`F.
`
`PO's Secondary Consideration Evidence Fails
`1. The Secondary Consideration Arguments Are Moot
`Secondary consideration evidence compensates for potential hindsight.
`
`Graham v. John Deere Co. of Kansas City, 383 US 1, 36 (1966). Here, where there is
`
`a strong prima facie case of obviousness, secondary considerations cannot save the
`
`patent as a matter of law. W. Union Co. v. MoneyGram Payment Sys., Inc., 626 F.3d
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`1361, 1373 (Fed. Cir. 2010); see also Tokai Corp. v. Easton Enters., Inc., 632 F.3d
`
`1358, 1371 (Fed. Cir. 2011). Moreover, the Board has already determined that the
`
`secondary consideration evidence submitted in this case does not overcome the strong
`
`prima facie case of obviousness. '774 Opinion at 62 ("Weighing the evidence of
`
`obviousness against the evidence of nonobviousness, we determine that the evidence
`
`of obviousness is the most convincing evidence in the record."). PO has provided no
`
`secondary consideration evidence other than that already deemed insufficient to
`
`overcome the obviousness arguments of the claims of the related '774 Patent, and PO
`
`does not even attempt to show nexus between its insufficient evidence and the claims
`
`of the '501 Patent.
`
`2. PO's Commercial Success Evidence Fails
`The Federal Circuit has long-held that "weak secondary considerations
`
`[including commercial success] generally do not overcome a strong prima facie case
`
`of obviousness." W. Union Co. v. MoneyGram Payment Sys., Inc., 626 F.3d 1361,
`
`1373 (Fed. Cir. 2010); see also Tokai Corp. v. Easton Enters., Inc., 632 F.3d 1358,
`
`1371 (Fed. Cir. 2011). This is particularly true when an invention involves nothing
`
`more than "the predictable use of prior art elements according to their established
`
`functions." Wyers v. Master Lock Co., 616 F.3d 1231, 1246 (Fed. Cir. 2010).
`
`The Petition establishes that the '501 invention is nothing more than a
`
`predictable use of prior art elements according to established functions. See, e.g.,
`
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`Petition at 40-43; see also, e.g., Ex. 1034 at 48. Accordingly, PO's secondary
`
`evidence, including commercial success, does not overcome the strong showing of
`
`obviousness.
`
`PO's commercial success evidence also fails because it does not provide
`
`competent evidence of market share,1 and instead relies on vague numbers of products
`
`sold. In re Applied Materials, Inc., 692 F. 3d 1289, 1300 (Fed. Cir. 2012) ("[T]he
`
`number of units sold without evidence of the market share is only weak evidence of
`
`commercial success . . . ."). Those vague numbers are found in Mr. Giraldi's
`
`declaration. Ex. 2048 at 1. The declaration provides revenue for Packers Plus' entire
`
`business, but gives no specifics about products alleged to perform the '501 claimed
`
`methods. Id. Mr. Giraldi (Packers Plus's CFO) also misstates that "Packers Plus has …
`
`performed fracture treatments." Id. Packers Plus does not have a fracking business;
`
`it merely sells tools that are sometimes used by third parties in fracking treatments.
`
`Ex. 1045 at 132:9-13.
`
`3. There is No Nexus to the Claims
`PO also has a fundamental nexus problem concerning the alleged commercial
`
`
`1 PO cherry-picked six oil fields to create an illusion of market context. See,
`
`e.g., Ex. 2010 at 4-5; POR at 41-42. Such limited evidence fails to establish the
`
`relevant full market or PO’s share of that market.
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`success because it has made no showing of how the devices represented in its vague
`
`sales data were used, even though substantial uses outside of the '501 claimed methods
`
`exist. See ClassCo, Inc. v. Apple, Inc., 838 F. 3d 1214, 1220 (Fed. Cir. 2016) (no
`
`nexus unless the evidence is "reasonably commensurate with the scope of the
`
`claims."). PO provides sales data of varying vagueness related to Packers Plus's
`
`StackFRAC tools, Baker Hughes's FracPoint tools and Petitioners' tools. PO asks the
`
`Board to assume, without evidence, that these tools are used to carry out the claimed
`
`methods. Ex. 1045 at 134:11-139:5. For the additional claim limitations provided in
`
`'501 claim 1 over the '774 claims relating to hydraulically actuated sleeves, PO's expert
`
`provides literally no analysis to support his conclusory opinion that these limitations
`
`are present in the accused systems. Ex. 2081 at 30.
`
`But these tools may be used in any number of ways that fall outside of the
`
`claims. For example, they may be used in cased (instead of open) holes. See, e.g., Ex.
`
`1001 2:25-38; see also, e.g., Ex. 2019 at 12; Ex. 1045 at 146:4-147:10. Similarly, the
`
`tools may be used in vertical (instead of horizontal) wellbore sections. See, e.g., Ex.
`
`1001 2:25-38; see also, e.g., Ex. 2019 at 12; Ex. 1047 at 16:1-5. The sales data also
`
`includes sellable packers that represent the majority of Petitioners' business and that
`
`fall outside of both PO's and Petitioners' SBP claim constructions. Ex. 2051 at 82; Ex.
`
`1044 ¶¶ 21-23; Ex. 1045 at 148:6-15.
`
`PO also relies on evidence without providing any explanation as to how the
`
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`IPR2017-01236
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`Patent 9,303,501
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`evidence meets the limitations of the claimed method. An example of the liberties that
`
`PO takes with the evidence is illustrated by the figure of Petitioners' products shown
`
`on page 39 of the POR (reproduced and annotated below):
`
`“News,
`Padier
`
`Inflatable Packer
`
`Plug utilizing fluid conveyed
`sealing device
`
`
`
`
`
`
`
`Mnnnhom Sleeve w/
`Comoosite Cover
`
`Swellable Packers
`
`
`i
`
`
`1‘
`Pen
`MOMM 5“” MO
`-,
`:._
`Colar
`
`
`Campos-1e Cover
`
`
`BuliDoo'" ”0
`Inflatable Packer
`
`05mm"
`Swelable Packet
`
`.
`.
`Mull-Shun Sleeve
`
`SnugIe-Shol
`.
`
`Singlesllot
`.
`
`ROk ANkOR‘
`
`w
`
`Hmzontal
`Ball Seal
`
`’
`
`
`
`Fraxsis‘“
`Swellable Packer
`
`ARES" PECKOf
`
`Ccmbomw
`Packer
`
`Stlmulating ma 4m zone
`
`Annotated Fig. from Ex. 2039
`
`As shown, PO uses evidence of inflatable and swellable packers that are outside of the
`
`claims. Ex. 1044 111] 21-23. PO also provides no explanation as to how the "toe" or
`
`end of the illustrated tubing string meets the requirements of a "hydraulically actuated
`
`sliding sleeve [that] moves from the closed port position to the open port position
`
`without the hydraulically actuated sliding sleeve engaging any fluid conveyed sealing
`
`device." Furthermore, the equipment represented by the vague sales data was