Cajun Servs. Unlimited v. Benton Energy Serv. Co.

Decision Date15 June 2020
Docket Numberc/w 18-5630 SECTION M (2),CIVIL ACTION NO. 17-0491 SECTION M (2),c/w 18-5932 SECTION M (2)
PartiesCAJUN SERVICES UNLIMITED, LLC, ET AL. v. BENTON ENERGY SERVICE COMPANY, ET AL.
CourtU.S. District Court — Eastern District of Louisiana
ORDER & REASONS

Before the Court are the following motions filed by defendant Benton Energy Service Company d/b/a Besco Tubular ("Besco"): (1) a motion for post-trial relief on plaintiff's patent-infringement claim;1 (2) a motion for post-trial relief on fraud and Louisiana Unfair Trade Practices Act ("LUTPA") claims;2 (3) a motion for post-trial relief on trade-secret misappropriation and breach-of-contract claims;3 (4) a Rule 59 motion for new trial / alter / amend / for remittitur on damages award to plaintiff;4 and (5) a motion to stay execution of judgment;5 as well as the following motions filed by plaintiffs Cajun Services Unlimited, LLC d/b/a Spoked Manufacturing ("Cajun"), T2 Tools & Design, LLC ("T2 Tools"), Shane Triche, and Heath Triche (collectively, "Plaintiffs"): (6) a motion to alter the judgment with respect to the scope of injunction;6 and (7) a motion for writ of execution and/or writ of fieri facias.7 Plaintiffs oppose Besco's motions,8 and Besco opposes Plaintiffs' motions.9 Besco replies in support of its motions.10 Plaintiffs filed ajoint surreply in opposition to Besco's motions,11 and Besco filed a sur-surreply in support of its motions.12 Having considered the parties' memoranda, the record, and the applicable law, the Court issues this Order & Reasons.

I. BACKGROUND
A. Procedural Background

This action is one among three consolidated lawsuits over rights to an elevator roller insert system ("ERIS"), a technology used in drilling for oil. On January 20, 2017, Cajun filed suit against Besco (the "Cajun I Lawsuit"), alleging violation of the Defend Trade Secrets Act ("DTSA"), 18 U.S.C. §§ 1831, et seq.; violation of the Louisiana Uniform Trade Secrets Act ("LUTSA"), La. R.S. 51:1431, et seq.; violation of the LUTPA, La. R.S. 51:1401, et seq.; bad faith breach of contract; fraud; and civil conspiracy.13 Cajun also sought injunctive relief and a declaratory judgment that Cajun was the owner of all right, title, and interest to all improvements and modifications made to the ERIS, and that Besco assign all right, title and interest in all information conceived of and/or reduced to practice, and any inventions, patent applications, or patents that relate to the ERIS.14 Besco filed a motion for partial summary judgment to dismiss Cajun's claim under the DTSA on the ground that Cajun lacked standing because it did not own any trade secrets.15 To streamline the litigation, Cajun agreed not to oppose dismissal on that ground.16 The Court granted the motion for partial summary judgment, dismissed Cajun's DTSA claim without prejudice, and administratively closed the case in anticipation of Cajun's moving to amend its complaint to assert a patent-infringement claim.17

On June 4, 2018, the day before Cajun's ERIS patent issued (U.S. Patent No. 9,988,862, "the '862 Patent"), Besco filed suit against Cajun (the "Besco Lawsuit"), seeking a declaration that Cajun's patent was invalid, unenforceable, and/or not infringed by Besco.18 On June 14, 2018, Cajun, its officers Shane Triche and Heath Triche, and a related entity, T2 Tools, filed suit against Besco, re-alleging the same causes of action, except for civil conspiracy, asserted in the Cajun I Lawsuit and adding a patent-infringement claim (the "Cajun II Lawsuit").19 Besco answered asserting counterclaims that re-alleged the same causes of action it alleged in the Besco Lawsuit plus allegations of unfair and deceptive trade practices, fraudulent inducement, breach of oral contract, and invalidity of contract.20 The Court consolidated the Cajun I Lawsuit with the Besco Lawsuit and the Cajun II Lawsuit on August 15, 2018.21 On April 3, 2019, the Court granted Cajun's motion to dismiss the Besco Lawsuit for lack of subject-matter jurisdiction, leaving only the claims asserted in the Cajun I and Cajun II Lawsuits.22 On June 7, 2019, the Court denied Besco's motions for partial summary judgment to dismiss Plaintiffs' breach-of-contract claim, trade-secret claims, and patent-infringement claims.23 On July 8, 2019, a four-day jury trial commenced,24 which resulted in a jury verdict in favor of Plaintiffs and against Besco on all claims.25

Following trial, the Court established a briefing schedule for all post-verdict/prejudgment motions the parties indicated they would file.26 Ahead of the established schedule, Plaintiffs fileda motion for injunctive relief to prevent dissipation of assets and for writ of attachment,27 and then on August 14, 2019, they filed a motion for declaratory judgment and injunctive relief,28 and a motion for attorney's fees.29 In addition, Besco filed a motion to compel arbitration,30 which the Court denied on November 19, 2019.31 On January 23, 2020, the Court denied Plaintiffs' motion for injunctive relief to prevent dissipation of assets and for writ of attachment,32 granted in part and denied in part Plaintiffs' motion for declaratory judgment and injunctive relief,33 and granted in part and denied in part Plaintiffs' motion for attorney's fees.34 On February 7, 2020, the parties submitted a joint proposed form of judgment,35 which the Court used to enter final judgment that same day.36

B. Factual Background
1. The ERIS Technology37

In the oil-and-gas industry, segments (i.e., a single joint of pipe) or stands (i.e., generally two or three joints of pipe) of tubulars are threaded together to form tubular strings that are insertedinto a wellbore drilled into the earth. Elevators are used to grip and secure each segment or stand to lift the segment or stand into position for threading the tubulars together. Threading is typically performed by rotating the tubular in the elevator with a power tong or by rotating the entire elevator on a swivel.

Difficulties can be encountered with maintaining proper thread integrity of the connections while making up the segment or stand to the string of tubulars. Because these difficulties posed serious cost and safety concerns, there was a need in the industry for a device that would allow tubulars to rotate freely within a closed elevator while supporting the weight of the tubular. Plaintiffs maintain that the ERIS, which embodies the invention disclosed in the '862 Patent, provides a solution to this problem.38 As described in the '862 Patent, the ERIS is comprised of elevator inserts (which are interchangeable to accommodate different diameter pipe) that interconnect with the inner surface of an elevator. The inserts themselves are further comprised of a plurality (i.e., at least two) of upper rollers. The primary function of the upper rollers is to support the weight of the tubular within the elevator while facilitating free rotation of the tubular. In one embodiment of the ERIS, the upper rollers are further comprised of two faces - an upper face upon which the upset area of a tubular rests and a second face which is parallel with a central axis of the elevator. In some embodiments of the ERIS, the inserts are further comprised of a plurality of lower rollers with a single face, which is parallel with a central axis of the elevator and prevents a tubular from binding against the elevator roller insert. In other embodiments, the ERIS inserts may not include lower rollers.39 However, each independent claim (Claims 1, 9, 19, and 26) references a plurality of lower or second rollers.40

2. The Business Relationship Between Plaintiffs and Besco41

Besco is an oilfield service company specializing in oilfield pipe running services that utilize specialized tubular handling equipment operated by Besco's personnel. Besco developed a system for compensating or offsetting suspended tubular goods during pipe installation and removal called the Bail Assisted Tubular Thread System, or "BATT System," which Besco patented (U.S. Patent No. 9,816,333, "the '333 Patent"). To accommodate applications of the BATT System where vertical space within a drilling derrick was limited, Besco decided to utilize a hydraulic single joint elevator (the "Tesco elevator")42 as part of the BATT System in order to shorten the overall length of the equipment. In an attempt to resolve the problem of maintaining the thread integrity of the tubular, Besco utilized a specialized hydraulic swivel that allowed the entire Tesco elevator, as well as any tubular gripped therein, to fully rotate. According to Besco, the solution was not optimal because the lines supporting the swivel and the elevator had a tendency to wrap and tangle.

Besco maintains that its operations manager, Jamie Lovell, conceived of a solution to permit the tubular to spin inside of the Tesco elevator by installing rollers into the die insert, and also asked Cajun to prepare drawings reflecting his concept of the roller dies. While Plaintiffs admit that Cajun created drawings and fabricated components of the roller inserts customized for Besco's BATT System and the Tesco elevators, Plaintiffs deny that Lovell was the inventor of the disputed roller inserts. Rather, Plaintiffs contend that Shane and Heath Triche, brothers and managers of Cajun, had conceived of the ERIS system by the end of September 2014 after Lovell introduced and discussed the problem with them.43 These roller inserts essentially constituted theERIS, for which Shane and Heath Triche sought patent protection on March 23, 2015.44 In mid-March 2015 and again a few weeks later in early April, Plaintiffs successfully tested the ERIS at Sea Ropes, LLC's facility in Houma, Louisiana, in the presence of Besco's personnel, including Esco Benton, III, chief operating officer for Besco.45

Following a series of conversations, it became evident that there was a dispute over who invented the ERIS and was entitled to its ownership. Notwithstanding the dispute, Besco began...

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