IP Law Daily, PATENT—Fed. Cir.: Shell’s non-infringement judgment survives appeal in suit involving hydrocarbon production, (May 31, 2016)

By Mark Engstrom, J.D.

In a lawsuit alleging the infringement of a patent on a process for producing ethylene and purified benzene from refinery mixtures, a federal district court did not err in granting summary judgment of non-infringement, either literally or under the doctrine of equivalents, to Shell Oil Company, the U.S. Court of Appeals for the Federal Circuit has ruled (David Netzer Consulting Engineer LLC v. Shell Oil Company, May 27, 2016, Lourie, A.). The district court’s finding of non-infringement was affirmed.

Plaintiff David Netzer Consulting Engineer LLC sued Shell Oil Company for the infringement of U.S. Patent No. 6,677,496, titled “Process for the Coproduction of Benzene from Refinery Sources and Ethylene by Steam Cracking.” The patent described a process for the coproduction of ethylene and purified benzene from refinery mixtures.

Shell sought summary judgment of non-infringement. According to Shell, its accused process did not meet the “fractionating” step of the asserted patent because Shell used extraction (a “Sulfolane” process that was developed by Shell) to form a benzene product that was 99.9 percent pure.

Netzer responded that “fractionating” should be construed to mean “separating a chemical mixture into fractions, no matter the process units used.” Examples of process units, according to Netzer, included distillation columns (for separating chemicals based on differences in boiling points), extractors (for separating chemicals based on solubility differences), and hydrotreaters (for hydrogenating unsaturated hydrocarbons, such as olefins).

The district court did not make any factual findings to support any particular claim construction, the Federal Circuit noted, but its claim construction was implicit in the grant of summary judgment of non-infringement to Shell.

The district court found no literal infringement because Netzer’s method did not include extraction and did not yield a benzene product that was 99.9 percent pure. To literally infringe the claimed process, the district court explained, Shell would have to eliminate the extraction step and still produce a benzene product that was at least 80 percent pure. The district court also found that Shell did not infringe under the doctrine of equivalents because Netzer was barred by “specific exclusion, prosecution-history estoppel, and prior art.”

Claim construction. The Federal Circuit found that the claim term “fractionating” meant “distillation” (separating compounds based on differences in boiling points), which excluded extraction processes (separating compounds based on solubility differences) such as Shell’s Sulfolane process. According to the Federal Circuit, the specification repeatedly and consistently used “fractionating” or “fractionation” to describe the separation of petrochemicals based on boiling point differentials. Moreover, the intrinsic record showed that Netzer had made clear and unmistakable statements that: (1) distinguished its claimed invention and (2) disclaimed conventional extraction methods that produced benzene with a 99.9 percent purity.

Netzer distinguished conventional extraction from fractionation in the specification, for example, and indicated that “fractionation” did not include conventional extraction. In addition, Netzer clearly disclaimed conventional extraction by characterizing it as expensive and not required, due to a shift in market demand, and by distinguishing it from the claimed invention. Having disclaimed conventional extraction in the publicly available intrinsic record, Netzer could not recapture the disclaimed subject matter.

Because the intrinsic evidence pointed in a single direction and required that “fractionating” be construed as separating compounds based on the differences in their boiling points, the federal Circuit concluded that “fractionating” meant separating compounds based on the differences in their boiling points, which excluded Shell’s Sulfolane process and other conventional extraction methods.

Infringement. The Federal Circuit found that the district court did not err in granting summary judgment of non-infringement, either literally or under the doctrine of equivalents.

First, Shell’s process did not literally meet the “fractionating” limitation. Shell relied on conventional extraction—its own Sulfolane process—to refine a mixture of 57 percent benzene into a benzene product that was more than 80 percent pure.

“Fractionating,” the Federal Circuit reiterated, meant distillation, and thus excluded conventional extraction. Moreover, the earlier steps of Shell’s process refined “pyrolysis gasoline” to produce a benzene mixture that was 57 percent pure benzene, which did not satisfy the limitation “to form a purified benzene product comprising at least about 80 wt % benzene.”

Moreover, Netzer had disclaimed conventional extraction, including the Sulfolane process, and thus could not prevail in its argument that the claimed fractionating step was literally infringed by the Sulfolane process.

Second, Netzer could not show infringement under the doctrine of equivalents. According to the Federal Circuit, Netzer’s disclaimer of the Sulfolane process for literal infringement applied equally to infringement under the doctrine of equivalents.

Moreover, no reasonable jury would find that the accused process performed substantially the same function in substantially the same way to obtain substantially the same result. Shell’s Sulfolane process did not create an 80-percent benzene product in substantially the same way as the claimed process, the court explained, because almost all of the purification in the Sulfolane process was done through extraction, which was substantially different from the claimed process of separating compounds through distillation.

Ultimately, drawing all justifiable inferences in Netzer’s favor, the Federal Circuit decided that Netzer could not establish infringement under the doctrine of equivalents given the substantial difference between the claimed process and the accused process.

The case is No. 2015-2086.

Attorneys: Anthony Matthew Garza and Steven Chase Callahan (Charhon, Callahan, Robson & Garza, P.C.) for David Netzer Consulting Engineer LLC. Kathleen M. Sullivan, Kevin Alexander Smith, and Joshua L. Sohn (Quinn, Emanuel, Urquhart & Sullivan, LLP), Charles Bruce Walker, Jr. (Norton Rose Fulbright US LLP), and Jayme Partridge (Patterson & Sheridan LLP) for Shell Oil Company.

Companies: David Netzer Consulting Engineer LLC; Shell Oil Company

Cases: Patent FedCirNews