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Three Strikes and You are Out: District Court Grants Summary Judgment on Lack of Standing, No Infringement and Invalidates the Patent

Plaintiff NOV filed a patent infringement action asserting that defendant Omron had infringed NOV’s patent (U.S. Patent No. 5,474,142 or the ‘142 Patent). Specifically, NOV alleged Omron’s oil rig automation control system has an automatic driller function that infringes one or more claims of the ‘142 Patent.

After years of litigation, Omron filed dispositive motions asserting lack of standing, no infringement and invalidity of the ‘142 Patent. The district court first found that NOV had no standing to assert the patent as the owner of the patent had only “agreed to assign” the patent. “In sum, the prevailing Federal Circuit case law makes clear the “agrees to assign” language in the ACA was not a present assignment. The ACA further indicates Varco, L.P. was to issue a separate assignment document, but there is no such piece of paper. Because NOV is unable to show the ACA was a present assignment of assets, the Court finds, on this ground alone, NOV has failed to satisfy its burden of proving ownership and, consequently, standing to sue.”

The district court also found the patent invalid based on a prior public use of the invention in the form of a prototype. “Here, there is no dispute Bowden’s prototype successfully drilled both the vertical and horizontal portions of the second well. While the drilling may not have been perfect, it worked “fairly good” and good enough to get paid for it after the fact. Critically, these drilling operations on the second well entailed every step of the methods described in claims 11 and 14. While NOV insists the prototype’s intended purpose was horizontal drilling, which requires sliding the curve, there is zero mention of horizontal drilling in the asserted claims, much less what sliding the curve is and its necessity to horizontal drilling. . . . Bowden’s asserted uncertainty his prototype would work on the curve does not create a genuine issue of fact. Claims 11 and 14 of the ‘142 Patent are broad claims and do not require drilling horizontally or sliding the curve; rather, they describe a method for automatically drilling using drilling fluid pressure and bit weight to control the release of the drill string. When Bowden automatically drilled the vertical and horizontal portions of the second well using these parameters, claims 11 and 14 unequivocally had been reduced to practice.”

Finally, the district court also concluded that the defendant did not infringe the ‘142 Patent. Both claims 11 and 14 of the ‘142 Patent state unambiguously that the signal, which represents changes in drilling fluid pressure, must be relayed to the drill string controller. Thus, the same signal that is produced at the outset is relayed to the drill string controller without being combined with any other signal. Markman Order at 6-14. As the Court made clear, the ‘142 Patent claims do not cover a system where signals are combined. Id. In contrast, the signal “representing changes in drilling fluid pressure” in the Omron system is never sent to the drill string controller nor is the signal “representing changes in bit weight.” Instead, these signals are used as multipliers to process a new signal called the “Block Velocity Setpoint” in feet/minute. This signal is further processed to generate a new set point in units of hertz. The VFD then converts the signal to alternating current, which is then ultimately sent to the motor, i.e. the “drill string controller.” The Court’s Markman Order clearly held the ‘142 Patent does not cover the type of system described in Omron’s ‘297 Patent. Therefore, there is no literal infringement.”

Accordingly, the district court granted the motion for summary judgment.

National Oilwell Varco, L.P. v. Omron Oilfield & Marine, Inc., Case No. A-12-CA-773-SS (W.D. Tex. Feb. 17, 2015)

The authors of are patent trial lawyers at Jeffer Mangels Butler & Mitchell LLP. For more information about this case, contact Stan Gibson at 310.201.3548 or