DCT

2:22-cv-00224

VP Sales & Mfg LP v. Guerra

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I. Executive Summary and Procedural Information

  • Parties & Counsel:
  • Case Identification: 2:22-cv-00224, S.D. Tex., 03/23/2023
  • Venue Allegations: Venue is asserted based on the residency of the defendants within the state of Texas.
  • Core Dispute: Plaintiff, the assignee of a patent, seeks to correct the patent's inventorship by removing the two named inventors and naming one of its own employees as the sole inventor, and further seeks a declaration that the patent is invalid due to pre-filing commercial sales.
  • Technical Context: The technology relates to locking mechanisms for packing nuts used in high-pressure reciprocating pumps, a critical component in the oil and gas fracking industry.
  • Key Procedural History: The complaint alleges that this federal action arises from facts discovered during a deposition in a related state court litigation. In that deposition, one of the named inventors, Defendant Guerra, allegedly admitted that the other named inventor, Defendant Townsend, was not a true inventor and was listed on the patent as part of a scheme to facilitate royalty payments. The complaint also notes that Defendant Townsend has filed a separate state court suit against the Plaintiff for breach of a royalty agreement, which has been abated pending this federal case.

Case Timeline

Date Event
2016-07-25 Alleged conception date of the invention by Dewey Clark
2016-10-24 Alleged first commercial sale of product embodying the invention
2016-10-27 Alleged second commercial sale of product embodying the invention
2017-04-28 Earliest Priority Date (U.S. Provisional Application 62/491,686)
2018-04-30 Filing Date of application leading to the '896 Patent
2020-02-25 Issue Date of U.S. Patent No. 10,570,896
2023-03-23 Filing Date of Second Amended Complaint

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

U.S. Patent No. 10,570,896 - "Packing Nut Lock"

  • Patent Identification: U.S. Patent No. 10,570,896, "Packing Nut Lock", issued February 25, 2020 (the "’896 Patent").

The Invention Explained

  • Problem Addressed: In high-pressure reciprocating pumps, such as those used in hydraulic fracturing, the packing nut—a component that secures a seal—is subject to intense vibration ( Compl. ¶15; ’896 Patent, col. 1:50-54). This vibration can cause the nut to loosen over time, leading to dangerous high-pressure fluid leaks, damage to the pump (e.g., a "washboard effect"), and costly downtime for retightening (’896 Patent, col. 1:55-64).
  • The Patented Solution: The invention is a locking assembly for this packing nut. It comprises a set screw that is inserted through a "mating hole" in the pump's main body (the "fluid end block") at an angle. The tip of this set screw is designed to engage and interlock directly between the external threads of the packing nut, physically preventing the nut from rotating and loosening due to vibration (’896 Patent, Abstract; col. 5:1-17, Fig. 6).
  • Technical Importance: This approach provides a mechanical lock to prevent loosening, aiming to increase the operational time of the pump from a few hours to hundreds of hours between adjustments, thereby enhancing safety and efficiency (’896 Patent, col. 8:33-40).

Key Claims at a Glance

  • The complaint puts the entire patent's inventorship and validity at issue. Independent Claim 1 is the broadest claim.
  • Independent Claim 1: A fluid end assembly for a reciprocating pump, comprising:
    • A fluid end block component with at least one threaded bore and at least one mating hole that intersects the bore at a non-zero angle.
    • At least one set screw received by the mating hole.
    • A packing nut with a shoulder having a second threaded section, which is rotatably received by the threaded bore.
    • Wherein the tip of the set screw interlocks between threads of the packing nut's shoulder to prevent axial displacement of the nut.
    • Wherein the packing nut is adapted to receive the reciprocating motion of a plunger.

III. The Accused Instrumentality

This section is not applicable as the complaint does not allege patent infringement against a product sold by the Defendants. The dispute centers on the inventorship and validity of the patent itself.

IV. Analysis of Core Allegations

Analysis of Inventorship Correction Allegations (35 U.S.C. § 256)

The complaint seeks to remove the named inventors, Jesse Guerra and Richard Townsend, and substitute Dewey Clark, a VP Sales employee, as the sole inventor (Compl. ¶32). This claim rests on allegations that the currently named inventorship is incorrect and arose from a fraudulent scheme.

  • Allegation of Non-Inventorship (Townsend): The complaint alleges that Defendant Townsend did not conceive of or contribute to the invention in any way (Compl. ¶28). The primary evidence cited is a deposition transcript in which Defendant Guerra allegedly admits that Townsend "did not put any input or ideas or intellectual property or whatever to create this packing nut lock" (Compl. ¶22, p. 5). The complaint asserts that Townsend was named as a co-inventor solely as a pretext to justify royalty payments from VP Sales to Townsend as part of an illicit "kickback" scheme (Compl. ¶¶17-18, 23).
  • Allegation of Non-Inventorship (Guerra) and True Inventorship (Clark): The complaint alleges that while Defendant Guerra was an employee of VP Sales, the actual conception of the invention was by another employee, Dewey Clark (Compl. ¶¶15, 31). It is alleged that Clark proposed the "packing nut lock invention as a solution" to known problems, while a different proposal by Guerra for a "jam nut" proved unworkable (Compl. ¶15). The complaint alleges Guerra "took credit for the invention" that was conceived by Clark (Compl. ¶16).
  • Visual Evidence: The complaint includes a deposition transcript excerpt where Defendant Guerra is questioned about the inventorship of the '896 Patent (Compl. ¶22, pp. 5-6). This excerpt is presented as direct evidence that Guerra admitted Townsend was not an inventor and was added to the patent application as a "way to put him as a co-inventor so he'd get royalties" (Compl. p. 6).

Analysis of Invalidity Allegations (35 U.S.C. § 102)

The complaint seeks a declaratory judgment that the ’896 Patent is invalid under the on-sale bar provision of pre-AIA 35 U.S.C. § 102(b), or the equivalent provision of the AIA, 35 U.S.C. § 102(a)(1).

  • Allegation of Pre-Critical Date Commercial Sale: The complaint alleges that "products containing Mr. Clark's patented invention were sold on October 24, 2016 and October 27, 2016" (Compl. ¶16).
  • Timing: The application for the ’896 Patent was filed on April 30, 2018, with a claimed priority date of April 28, 2017 (’896 Patent, p. 1). The alleged sales in October 2016 occurred more than one year prior to both the filing date and the priority date. If these sales are proven to be commercial sales of the invention as claimed in the '896 Patent, they would constitute an invalidating on-sale bar.

V. Key Claim Terms for Construction

The complaint does not raise disputes regarding the meaning of specific claim terms. The central issues are the factual questions of who conceived the invention and whether it was subject to an invalidating commercial sale, rather than a legal dispute over the scope of the claim language. Therefore, the complaint does not provide a sufficient basis for a claim construction analysis.

VI. Other Related Allegations

  • State Law Claims: The federal patent claims are accompanied by state law claims for civil theft, civil conspiracy, and unjust enrichment (Compl. ¶¶33-48). These claims are factually intertwined with the inventorship dispute. The complaint alleges that Defendants Guerra and Townsend conspired to falsely represent Townsend as a co-inventor to unlawfully obtain royalty payments from VP Sales, and that these payments constitute theft and unjust enrichment (Compl. ¶¶36, 42, 47).
  • Declaratory Judgment on Royalty Agreement: The complaint also seeks a declaration that the royalty agreement with Townsend is void and unenforceable due to the alleged fraudulent inducement (Compl. ¶¶49-57).

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

The resolution of this case appears to hinge on two primary, fact-intensive questions for the court:

  1. A core issue will be one of evidence of conception: Can VP Sales prove, likely through testimony and corroborating evidence, that Dewey Clark alone conceived of the complete invention as defined in the claims of the '896 Patent, and that the named inventors, Guerra and Townsend, made no inventive contribution? The deposition testimony of Defendant Guerra will be a central piece of evidence in this determination.
  2. A key validity question will be one of the on-sale bar: Did the product sales in October 2016 constitute a commercial sale of an embodiment that met all the limitations of an asserted claim of the '896 Patent? The outcome will depend on evidence demonstrating both the commercial nature of the transactions and the precise technical features of the products that were sold.