Exxon Corp. v. Phillips Petroleum
| Decision Date | 30 November 1999 |
| Docket Number | No. Civ.A. H-98-2592.,Civ.A. H-98-2592. |
| Citation | 81 F.Supp.2d 746 |
| Parties | EXXON CORPORATION, and Exxon Chemical Patents, Inc., Plaintiffs, v. PHILLIPS PETROLEUM, Defendant. |
| Court | U.S. District Court — Southern District of Texas |
William Charles Slusser, Slusser & Frost, Houston, TX, Louis S. Sorell, Brumbaugh Graves Donohue and Raymond, New York, NY, Kenneth M. Bialo, Rachel G. Atkin, Matthew K. McCoy, Baker & Botts, New York, NY, Marta E. Delsignore, Baker & Botts, New York, NY, for Exxon Corp., Exxon Chemical Patents Inc., Plaintiffs.
Phillip Wayne Fisher, Fisher Boyd Brown Boudreaux, et al., Houston, TX, for Phillips Petroleum Co.
Pending before the Court are Defendant's and Plaintiffs' Motions for Summary Judgment (Instrument Nos. 34 and 41). Based on the information provided to the Court, it is the finding of this Court that the Defendant's motion should be GRANTED and Plaintiffs' motion should be DENIED.
Plaintiffs Exxon Corporation and Exxon Chemical Patents, Inc. (collectively, "Exxon") bring this action against Defendant Phillips Petroleum Company ("Phillips"), alleging that Phillips infringed its patent in violation of 35 U.S.C. § 271.
Exxon owns U.S. Patent No. 5,324,800 ("the '800 patent"). The patent covers certain metallocene/alumoxane catalysts for making polymers, or plastics. All applicable maintenance fees have been paid for the patent.
The '800 patent claims priority to three earlier filed applications and an effective filing date of June 6, 1983, when the application was first filed. Exxon's European Patent Application containing the technical specifications of all four applications was published on December 27, 1984. Exxon filed its second application in the United States on April 29, 1985, and its third on December 22, 1989. Exxon filed the fourth application on August 30, 1991, having previously filed the required "37 C.F.R. § 160 Continuation or Divisional Filing Form." On the continuation form, an "X" was marked next to the statement "Cancel in this application original claims 1-11 of the prior application before calculating the filing fee." At that time, only claims 1-11 were pending, meaning that if Exxon canceled claims 1-11, it would have no claims pending with the Patent Office.
The Patent Office, pursuant to its internal policy, retained claim 1 of the fourth application and canceled claims 2-11. An official at the Patent Office crossed out the "11" and inserted "2-11." The form contains a marginal notation of "10/7/91" and the clerk's initials. Exxon received confirmation of this in a phone conversation with Patent Examiner Smith on or before January 23, 1992. Exxon's third application was abandoned as of April 8, 1992.
On June 29, 1992, Exxon filed an amendment, canceling claim 1 and adding claims 12-45. The '800 patent was issued on June 28, 1994.
Exxon alleges that Phillips has a polymerization plant in this district and that Phillips has publicly announced that it is manufacturing and selling polymers made with metallocene and manufactures metallocene catalysts for use in this plant at a location in Oklahoma. Exxon contends that Phillips's making and use of metallocene catalysts, and its making using, selling and offering for sale these polymers made with metallocene catalysts infringes Exxon's patent.
Exxon further alleges that Phillips has induced Phillips' catalyst suppliers, including Grace Davison (W.R. Grace) and Albemarle, and possibly its licensees, to infringe Exxon's patent by providing research, manufacturing instructions, and handling information regarding its patented catalyst. Exxon contends that Phillips provided the information to its suppliers with the intent to encourage the suppliers to make, sell and offer to sell Exxon's patented catalyst by, placing orders and purchasing the catalyst.
Exxon alleges that Phillips contributorily infringed its patent by selling a component of the metallocene catalyst to Grace Davison (W.R. Grace) and Albemarle, and possibly also Phillips' licensees. Exxon claims that there is no commercial use for metallocene that is not infringing.
Exxon claims that it notified Phillips of its patent and of its complaints regarding infringement. Exxon alleges that Phillips continues to infringe on its patent.
On June 3, 1999, Phillips filed a motion for summary judgment, contending that it is entitled to judgment as a matter of law. Phillips contends that Exxon's patent is invalid in light of Baxter Int'l, Inc. v. McGaw, Inc., 149 F.3d 1321 (Fed.Cir. 1998). Phillips argues that Exxon's patent is not entitled to the June 6, 1983 filing date, and consequently, under 35 U.S.C. § 102(b) the patent is invalid because it was filed more than a year after its foreign publication. (Instrument Nos. 34 and 35).
On June 23, 1999, Exxon filed a cross-motion for summary judgment and response to Phillips' motion for summary judgment, contending that it is entitled to judgment as a matter of law. (Instrument No. 41). Exxon asserts that Baxter does not apply, its patent is valid, and Phillips' use of the patented catalysts constitutes infringement. Specifically, Exxon claims that it paid a filing fee and it always had one claim pending, unlike Baxter. Exxon also contends that even if the Court finds that the Patent Office should have canceled claim 1, Exxon had a claim pending by October 7, 1991, when the Patent Office amended its application. Exxon argues that as a result, it is entitled to the June 6, 1983 filing date. Lastly, Exxon claims that Phillips is asking the Court to apply Patent Office regulation retroactively by pointing to the Patent Office's adoption of Baxter as support for its arguments.
On July 13, 1999, Phillips filed a response to Exxon's cross-motion for summary judgment and reply to Exxon's response to Phillips' motion for summary judgment. (Instrument No. 48). First, Phillips argues that this case cannot be distinguished from Baxter because the court in that case held that the Patent Office cannot revive claims that the applicant canceled. In addition, it argues that Exxon's payment of a filing fee, in contrast to Baxter, where the filing fee was not paid is not material. Exxon did not add a claim prior to abandoning its third application, which breaks the co-pendency chain. Phillips argues that the break in co-pendency means that the filing date is June 29, 1992, the date that Exxon filed claims 12-45. Next, Phillips claims that Exxon's third application was abandoned as a matter of law on November 1, 1991, prior to any conversation with the Patent Office that occurred on or before January 23, 1992. Further, Exxon was required to reduce all claims to writing and make them part of the official record. Finally, Phillips contends that it is not asking the Court to retroactively apply a regulation.
On August 4, 1999, Exxon filed a reply, arguing that Phillips had construed the holding in Baxter too broadly to mean that the Patent Office was stripped of nearly all discretion (Instrument No. 45). Exxon contends that Baxter is distinguishable on its facts from this case. Specifically, in Baxter, neither the Patent Office nor Baxter regarded the canceled claims as being part of the application. Baxter requested that the claims be canceled, the Patent Office canceled them, and Baxter never paid a filing fee. Baxter, in an effort to salvage co-pendency after the cancellation had destroyed it, argued that because the Patent Office's customary procedure was to deny entry of amendments which canceled all claims in an application, that its cancellation of all claims was not legally effective. Here, both the Patent Office and Exxon regarded claim 1 as having been part of the '800 application, which maintained co-pendency. In Baxter, the Patent Office made an unauthorized alteration to Baxter's application by undoing the cancellation at Baxter's request. Exxon claims that there was no such unauthorized action here. Exxon also contends that its reliance on its conversation with Patent Examiner Smith is proper because it was reduced to writing and it did not constitute an oral promise, stipulation, or understanding in relation to an issue about which there is doubt.
On August 23, 1999, Phillips filed a surreply, arguing that Exxon misstated the facts when it claimed that there was not an application on file without claims and that Exxon's fourth application had a claim pending at all times. (Instrument No. 47). Phillips asserts that when Exxon filed its fourth application, it requested that the Patent Office cancel claims 1-11, which meant that Exxon filed an application without a claim, in violation of 35 U.S.C. § 112. The Patent Office's decision to keep claim 1 when Exxon had canceled it was a waiver of the statutory requirement that a patent application be submitted with a claim. Such waivers are unauthorized actions, Phillips argues, and were expressly prohibited by Baxter. Phillips also contends that Exxon is attempting to alter the patent prosecution history by retroactively establishing the existence of a pending claim by relying on an oral communication from the Patent Office. Phillips argues that Exxon cannot rely on the June 29, 1992 Preliminary Amendment that memorializes the oral communication because the third application was abandoned before June 29, 1992, meaning that the communication was not memorialized during the pendency of the patent application chain. Phillips argues that Exxon's reliance on the Preliminary Amendment is also improper because the Amendment does not list the date that the communication took place and the communication describes unauthorized actions by the Patent Office insufficient to restore co-pendency.
Summary judgment is appropriate if no genuine issue of material fact exists and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56. A fact is "material" if its resolution in favor of one party might affect the outcome of the suit...
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