Oil Lift Technology Inc v. Millennium Oilflow Systems & Technology Inc

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: Oil Lift Technology Inc. (Canada)
  • Defendant: Millennium Oilflow Systems & Technology Inc. (Canada) and Most Oil USA Inc. (Delaware)
  • Plaintiff’s Counsel: Fish & Richardson P.C.
• Case Identification: 1:17-cv-01212, D. Del., 08/25/2017
• Venue Allegations: Venue is alleged to be proper as Defendant Most Oil USA Inc. is a Delaware corporation that resides in the district, and both defendants are alleged to transact business and offer the accused products for sale within the district.
• Core Dispute: Plaintiff alleges that Defendant’s Rod Lock products, used in oil well pump systems, infringe two U.S. patents related to polished rod locking clamp technology.
• Technical Context: The technology concerns safety and servicing equipment for progressing cavity pumps (PCPs) used in the oil extraction industry, specifically devices that secure a pump's drive rod.
• Key Procedural History: The complaint notes a 2014 patent infringement action between the parties in Canada involving the Canadian equivalents of the patents-in-suit. That litigation was reportedly resolved by a written agreement, which the complaint alleges prevented the defendant from manufacturing or selling the accused products in Canada, a fact that may be used to support allegations of pre-suit knowledge and willfulness in the present U.S. case.

Case Timeline

Date	Event
2000-06-09	Priority Date for '362 and '238 Patents
2014-01-01	Canadian Patent Litigation initiated (approx.)
2014-01-01	Canadian Patent Litigation resolved (approx.)
2015-04-28	U.S. Patent No. 9,016,362 Issued
2016-04-26	U.S. Patent No. 9,322,238 Issued
2017-08-25	Complaint Filed

II. Technology and Patent(s)-in-Suit Analysis

U.S. Patent No. 9,016,362 - "Polish Rod Locking Clamp" (issued April 28, 2015)

The Invention Explained

• Problem Addressed: The patent's background describes several problems with conventional progressing cavity pump systems, including crude oil leakage from stuffing boxes, the high cost and difficulty of servicing equipment, and significant safety hazards from uncontrolled "backspin" when a pump is shut down, which can cause heavy sheaves to explode from centrifugal forces (ʼ362 Patent, col. 1:20-67).
• The Patented Solution: The patent discloses a "combined blow out preventer and polished rod lock out clamp" designed to solve these issues in a single integrated device. The invention uses radially opposing clamp members, described as pistons, which have a hard, "concavely curved recess" to frictionally grip the oil pump's polished rod. This allows the rod to be securely suspended for servicing without requiring a rig. The device simultaneously incorporates an elastomeric seal to prevent well fluids from escaping, combining the functions of a safety clamp and a blowout preventer (ʼ362 Patent, col. 10:20-43, col. 11:8-27).
• Technical Importance: This integrated design was intended to reduce the equipment and personnel needed for maintenance, thereby lowering costs and improving operational safety at the wellhead (ʼ362 Patent, col. 1:47-58).

Key Claims at a Glance

• The complaint asserts independent claim 1 and dependent claims 2, 3, 4, and 6 (Compl. ¶22).
• Independent Claim 1 requires:
  • A housing with a bore for a polished rod and opposed radial bores.
  • Clamp members within the housing, each comprising a piston with a "hard inner end" and a "concavely curved recess" for engaging the polished rod in "non-elastomeric frictional contact."
  • An "elastomeric seal means" to provide a seal and prevent fluid escape.
  • A "manipulating means" (e.g., bolts) to move the pistons between a gripping and a retracted position.

U.S. Patent No. 9,322,238 - "Polish Rod Locking Clamp" (issued April 26, 2016)

The Invention Explained

• Problem Addressed: As a continuation of the application leading to the '362 Patent, the '238 Patent addresses the same technical problems of safety, cost, and inefficiency in servicing progressing cavity pump systems at oil wells (ʼ238 Patent, col. 1:20-67).
• The Patented Solution: The '238 Patent also discloses a polished rod lock-out clamp. The claims focus on the clamp's ability to suspend a polished rod using radially opposed pistons that make "frictional metal contact" with the rod. The invention specifically claims "blow out preventer seals" that are compressible, allowing the pistons to make direct metal-to-metal contact with the rod while still providing a seal against well pressure (ʼ238 Patent, col. 12:15-51).
• Technical Importance: The invention aims to provide a single, reliable device that both mechanically secures the heavy rod string for maintenance and prevents dangerous well blowouts, enhancing overall worksite safety (ʼ238 Patent, col. 2:32-45).

Key Claims at a Glance

• The complaint asserts independent claim 1 and dependent claims 2, 13, and 14 (Compl. ¶32).
• Independent Claim 1 requires:
  • A housing with a bore for receiving a polished rod.
  • "Clamp members" for "grippingly and frictionally engaging" the rod, with each member having a "hard inner end" and a "concavely curved recess" to achieve "non-elastomeric frictional contact."
  • A "manipulating means" to move the clamp members between a gripping position to suspend the rod and a retracted position.

III. The Accused Instrumentality

Product Identification

The "Accused MOST Rod Lock Products," which are alleged to include the "MOST's Rod Clamping BOP, Rod Clamping Dual Ram BOP, Rod Clamping Ratigan BOP, and Swivel Rod Clamping BOP" (Compl. ¶6-7).

Functionality and Market Context

• The complaint alleges that the accused products are "Rod Locks" that function to "clamp onto and securely hold in place the 'polished rod'" (Compl. ¶5). This capability is alleged to allow workers to safely service an oil pump without needing a separate rig and winch line to support the downhole equipment (Compl. ¶5).
• The complaint provides a side-by-side photograph comparing Plaintiff's "Oil Lift Rod Lock" with a "MOST Infringing Rod Lock." The photograph depicts the accused product as a green-colored mechanical assembly with a central bore and side-mounted bolts, which appear to be for actuating internal clamping mechanisms (Compl. p. 2, figure).
• Plaintiff alleges that MOST began manufacturing and selling its Rod Locks after Plaintiff introduced its own products to the market (Compl. ¶6).

IV. Analysis of Infringement Allegations

The complaint references claim chart exhibits (Exhibits 2 and 4) that were not included with the filed complaint document (Compl. ¶21, ¶31). The infringement theory is therefore summarized from the complaint's narrative allegations.

'362 Patent and '238 Patent Infringement Allegations

The complaint alleges that the Accused MOST Rod Lock Products, and specifically the "MOST Swivel Rod Clamping BOP," directly infringe at least claim 1 of both the '362 and '238 Patents (Compl. ¶22, ¶32). The core of the infringement theory is that the accused products are combined clamp and blowout preventers that operate in the same manner as the patented invention. The complaint asserts that the accused products are used to suspend a polished rod by creating a "non-elastomeric frictional contact" between internal clamping members and the rod itself (Compl. ¶5; '362 Patent, col. 11:18-20). The visual evidence provided is intended to show a substantial structural and functional similarity between the parties' products, suggesting the accused device contains a housing, internal clamp members, and external bolts for manipulation, corresponding to key elements of the asserted claims (Compl. p. 2, figure).

Identified Points of Contention

• Scope Questions: A primary question for the court will be whether the internal "clamp members" of the accused products meet the definition of a "piston" as recited in claim 1 of the '362 Patent. The construction of this term may be a central point of dispute.
• Technical Questions: What evidence supports the allegation that the accused products achieve "non-elastomeric frictional contact" or "frictional metal contact" as required by the claims? The complaint relies on a product photograph and functional description, but the precise nature of the gripping mechanism and the materials used inside the accused products will be a key factual question for discovery.

V. Key Claim Terms for Construction

The Term: "piston" ('362 Patent, Claim 1)

• Context and Importance: The infringement reading of claim 1 of the '362 Patent hinges on whether the accused device's clamping members can be characterized as "pistons." Practitioners may focus on this term because a finding that the members are not pistons could defeat the infringement allegation for this patent.
• Intrinsic Evidence for a Broader Interpretation: The specification consistently refers to the clamping members as "pistons" that are actuated by bolts to move within bores and force engagement with the rod (ʼ362 Patent, col. 10:20-26, "two opposing radial pistons 182a are actuated by bolts 184 to force the pistons together"). A party may argue the term should be given its plain and ordinary meaning of a sliding component within a bore used to exert pressure.
• Intrinsic Evidence for a Narrower Interpretation: A party could argue that the term is limited by the specific embodiments shown in Figures 18-21, which depict cylindrical pistons moving within defined cylindrical bores. If the accused device utilizes a different clamping mechanism, such as a wedge or a non-cylindrical block, it could be argued that it falls outside the scope of the term "piston" as used in the patent.

The Term: "non-elastomeric frictional contact" ('362 Patent, Claim 1) / "frictional metal contact" ('238 Patent, Claim 7)

• Context and Importance: This limitation is critical because it defines the nature of the gripping force as a hard, non-yielding contact, distinguishing it from a simple seal. The plaintiff must prove the accused products achieve this specific type of contact to show infringement.
• Intrinsic Evidence for a Broader Interpretation: The specification's purpose is to "suspend said polished rod" to prevent axial or rotational movement ('362 Patent, col. 11:20-22). This focus on the result (suspension) could support an interpretation where any predominantly hard-surface contact that achieves this result meets the limitation.
• Intrinsic Evidence for a Narrower Interpretation: The claims and specification repeatedly distinguish this hard contact from the function of the "elastomeric seal" ('362 Patent, col. 11:23-27). The patent describes the goal as "hard surface to hard surface contact" ('362 Patent, col. 10:12-13) and "metal to metal contact" ('238 Patent, col. 12:49-50), suggesting the contact must be direct, unmediated by any softer material, and designed for friction rather than just sealing.

VI. Other Allegations

Indirect Infringement

Plaintiff alleges induced infringement, stating that MOST encourages and instructs customers to use the accused products in an infringing manner through advertising, its website, and other promotional activities (Compl. ¶23, ¶33). Contributory infringement is also alleged based on the sale of replacement parts (Compl. ¶23, ¶33).

Willful Infringement

The complaint alleges that MOST's infringement has been willful. This allegation is primarily based on pre-suit knowledge allegedly obtained through MOST's involvement in the 2014 Canadian patent litigation concerning the Canadian equivalents of the patents-in-suit. Plaintiff asserts that MOST was aware of the related U.S. patent applications and therefore knew or should have known its activities would constitute infringement once the U.S. patents issued (Compl. ¶24-25, ¶34-35).

VII. Analyst’s Conclusion: Key Questions for the Case

• A central issue will be one of pre-suit knowledge and intent: to what extent does the prior Canadian litigation involving related patents establish the knowledge required to support a finding of willful infringement of the asserted U.S. patents? The court's analysis of this history will likely be critical to the willfulness claim.
• The case will also turn on a question of definitional scope: can the term "piston," as used in the '362 patent, be construed to read on the specific clamping members used in the accused products? The outcome of this claim construction battle may determine infringement of that patent.
• Finally, a key evidentiary question will be one of technical proof: can the plaintiff demonstrate that the accused devices achieve "non-elastomeric frictional contact" with the polished rod, as distinct from a primarily elastomeric sealing or gripping function? This will require moving beyond visual comparisons to a detailed examination of the accused products' internal operation and materials.