Conoco v. EEI

CAFC (August 17, 2006) (“consisting of” may basically limit claim scope, but such restriction is not absolute and “does not limit aspects unrelated to the invention”).

Conoco v. EEI provides further guidance in claim construction when “consisting of” limits the scope of the claims. In addition, issues of claim scope, doctrine of equivalents related to “water-alcohol mixtures”, and interpretation of the word “stable”, were decided.

To reduce drag in oil and gas pipelines, drag-reducing agents (DRA), comprising high-molecular weight polymers, may be introduced to reduce friction.  The technology involves grinding the polymers into particles at cryogenic temperatures, coating the resulting particles with a partitioning agent (here, a fatty acid wax or equivalent) while grinding to prevent agglomeration, and mixing the coated particles in a suspending medium such as water or a water-alcohol mixture.

In the case at bar, there were two Conoco patents in suit.  Claim 1 of U.S. Pat. No. 5, 244,937 (‘937) includes “[a] process for the preparation of a stable nonagglomerating suspension” and “a suspending material selected from the group consisting of water and water-alcohol mixtures.”  Claim 1 of U.S. Pat. No. 6,172,151 (‘151) is drawn to a process for suspending high molecular weight polymers in a nonaqueous mixture and includes “[a] method of reducing turbulent drag in a hydrocarbon liquid stream” and “[a] partitioning agent being a fatty acid wax”.

Defendant EEI, in a so-called Original Process, utilized Alfol-2 as a suspending medium and added a common denaturing agent, methyl isobutyl ketone (MIBK).  Alfol-2 contained from eight to 15 percent water and from 80 to 82.31 percent ethanol. MIBK was added at about five percent.  Later, EEI switched to a so-call Current Process which used Alfol-6 (substantially pure hexanol) as the suspending medium and C30+ wax as the partitioning agent.

EEI first contended that Alfol-2 was not a “water-alcohol mixture” as required by claim 1 of the ‘937 patent.  In a Markman Order, the district court had construed the term as “containing more than negligible amounts of water and alcohol”.  The ‘937 specification discussed an “aqueous” suspending medium made from, with, or by means of water and that the alcohol content “may vary widely” but was “usually” between “about 0 and 70 weight percent . . . and more usually between about 30 and about 50 weight percent.”  On appeal, EEI argued that the composition should have been limited to at least 30 percent water as described in the specification. The CAFC agreed with the district court, stating that “the patentee did not limit the claim term as EEI suggests”.  The Court reaffirmed its rule that the words of the claim are given their ordinary and customary meaning and must be read in the context of the entire patent, including the specification.  Any intention to disclaim or disavow the broad scope of the claim, said the Court, must be clear and intentional.  Finally, the Court noted that the limitations discussed in the specification represented only preferred embodiments.

EEI argued strongly that the inclusion of MIBK in its suspending agent, especially since it was added intentionally, put its Original Process outside the scope of claim 1 of the ‘937 patent.  As claim 1 used the limiting term “consisting of”, EEI contended suspending material having any additional components beyond the listed “water and water-alcohol mixtures” would not be covered by the scope of the claim.  While the Court agreed that “consisting of” is a restricting term of art, the restriction was not absolute and “does not limit aspects unrelated to the invention”.  MIBK was, in fact, added to Alfol-2 to avoid federal liquor tax liability.  Even though it was a not-insignificant amount, it was still an ‘impurity ordinarily associated” with such alcohols.  (As an interesting side note, the Court stated: “If, however, MIBK had been added to adjust the stability of the suspending medium or prevent agglomeration of the polymer, it may not have been an impurity and therefore EEI would most likely not infringe.”)

As to the issue of a “stable nonagglomerating suspension”, EEI argued on appeal that the district court erred when it construed a “stable” suspension as one where “the density of the polymer matches the density of the suspending material and thickening agent.” Since stability is a time-related property, the district court held that stability was measured relative to when it was injected into the pipeline.  EEI also argued that, since the ‘937 Specification claimed that the suspensions “may be shipped over large distances while retaining [their] properties”, any infringing product must be so capable.  The Court noted that the district court’s construction was not incongruous with the position advocated by EEI.  And, although EEI contended the accused product was not stable and that the polymer “quickly settled out”, Conoco pointed out that EEI represented to customers its product was stable, represented to the PTO that it was stable, and conceded it was stable when injected into the pipeline.  The CAFC thus determined that there was sufficient evidence to support the findings of the district court.

Finally, EEI argued that it did not infringe claim 1 of the ‘151 patent because C30+ wax was not a fatty acid wax and that Conoco was estopped from arguing the Doctrine of Equivalents based upon the prosecution history.  During prosecution, the examiner had added, to one of a new group of claims, the fatty acid wax limitation.  The limitation had been in the original group of claims and was present in others in the new group.  While EEI argued the addition was related to patentability, the Court held that the limitation was added “merely to correct an obvious omission.”  Also during prosecution, Conoco had surrendered metal stearates as not being fatty acid waxes.  EEI argued such constituted a surrender of all equivalents.  The Court disagreed, stating, “[W]e do not presume a patentee’s arguments to surrender an entire field of equivalents through simple arguments and explanations to the examiner.” Under the function-way-result test, the Court agreed with the district court that C30+ wax was equivalent to a fatty acid wax.

Click here to view the full opinion.