NCS Multistage Inc v. Entech Solutions As

I. Executive Summary and Procedural Information

• Parties & Counsel:
  • Plaintiff: NCS Multistage Inc. (Canada) and NCS Multistage, LLC (Texas)
  • Defendant: Entech Solutions, AS (Norway)
  • Plaintiff’s Counsel: Blank Rome LLP
• Case Identification: 6:22-cv-01316, W.D. Tex., 12/30/2022
• Venue Allegations: Venue is asserted on the basis that the defendant is a foreign entity, which may be sued in any judicial district. The complaint also alleges that the defendant committed acts of indirect infringement in the district by, among other things, providing assembly drawings and specifications for the accused product to its U.S. partner, Halliburton, in Texas.
• Core Dispute: Plaintiff alleges that Defendant indirectly infringes a patent related to downhole well construction tools by designing and supplying components for a "casing float" device that is assembled and sold in the U.S. by a third party.
• Technical Context: The technology involves tools that create temporary buoyancy in a well casing string, reducing friction to facilitate its installation into long, horizontal wellbores common in modern oil and gas extraction.
• Key Procedural History: The complaint alleges that Plaintiff's counsel notified Defendant’s U.S. partner, Halliburton, of the patent-in-suit on October 24, 2022. It further alleges that Defendant's own counsel contacted Plaintiff's counsel on December 1, 2022, to discuss a potential license. The complaint also asserts that Defendant was aware of two 2022 jury verdicts that found the patent-in-suit to be infringed and not invalid in cases against "virtually identical" products.

Case Timeline

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

U.S. Patent No. 10,465,445 - “Casing Float Tool”

The Invention Explained

• Problem Addressed: The patent addresses the technical challenge of running long casing strings into horizontal or deviated wellbores, where friction and drag can prevent the casing from reaching its target depth (Compl. ¶13; ’445 Patent, col. 1:21-29).
• The Patented Solution: The invention is a tool that is installed within the casing string and uses a "rupture disc" to seal off a lower portion of the string, creating an air-filled, buoyant chamber (’445 Patent, col. 4:19-24). This captured air makes the horizontal section of the casing lighter, reducing friction during installation (Compl. ¶13). Once the casing is in position, hydraulic pressure is applied from the surface, which first causes a securing mechanism to release the disc and then causes the freed disc to shatter against an impact surface within the tool, restoring a full internal diameter for subsequent wellbore operations (’445 Patent, col. 2:10-18). The complaint includes a diagram illustrating the operation of Plaintiff's commercial embodiment, the AirLock® system (Compl. ¶13).
• Technical Importance: This method allows for the installation of casing in long-reach horizontal wells and is designed to restore the full internal diameter of the casing without the need for costly and time-consuming drill-out operations common with other flotation techniques (’445 Patent, col. 1:40-48).

Key Claims at a Glance

The complaint asserts at least independent claim 28 and dependent claim 29 (Compl. ¶29).

Independent Claim 28 recites the essential elements of the float tool itself:

• A rupture disc assembly comprising a tubular member configured for in-line connection with a casing string.
• A rupture disc held in sealing engagement within a region of the tubular member.
• The rupture disc is configured to "disengage from sealing engagement" when exposed to a pressure greater than a hydraulic pressure in the casing string.
• The region of the tubular member where the disc is attached has a "larger internal diameter than the internal diameter of the casing string."

III. The Accused Instrumentality

Product Identification

The AirGlide™ Floatation Sub ("AirGlide") (Compl. ¶2).

Functionality and Market Context

The complaint alleges the AirGlide is a "casing floatation device" used to create buoyancy in a casing string to facilitate running it through the horizontal portion of a wellbore (Compl. ¶21). It is described as a tubular body containing a "glass barrier disc" that is "ruptured by applying hydraulic pressure from the surface," which in turn "restores the internal diameter of the casing string" (Compl. ¶21). The complaint includes a marketing image of the accused AirGlide device (Compl. ¶20). Defendant Entech is alleged to have designed the AirGlide, created its manufacturing specifications, and supplied components to its U.S. partner, Halliburton, which assembles and sells the final product to customers (Compl. ¶¶ 17-19).

IV. Analysis of Infringement Allegations

The complaint references a claim chart in an "Exhibit B" that was not filed with the public document; therefore, a narrative summary is provided below.

The complaint alleges that Defendant Entech indirectly infringes claims 28-29 of the ’445 Patent by supplying the AirGlide tool, its components, and its design/manufacturing specifications to Halliburton for assembly, use, and sale in the United States (Compl. ¶¶ 30-31). The core of the infringement theory is that the AirGlide tool contains all the structural elements of claim 28. The complaint’s description of the AirGlide as a tubular body with a pressure-rupturable disc that restores the casing’s internal diameter (Compl. ¶21) narratively tracks the key limitations of claim 28. The infringement allegations against Entech are for inducement and contributory infringement, based on Halliburton's alleged direct infringement through making, using, and selling the AirGlide tool (Compl. ¶¶ 30-31).

Identified Points of Contention

Scope Questions

A central dispute may arise over the claim limitation requiring the rupture disc to "disengage from sealing engagement." The patent specification describes a two-step sequence where a securing mechanism (e.g., a shear ring) first fails, releasing the disc to move and then shatter upon impact with another surface (’445 Patent, col. 10:1-11). The complaint’s description that the accused disc is "ruptured by applying hydraulic pressure" (Compl. ¶21) is less specific and raises the question of whether the accused device performs the claimed two-step "disengage-then-rupture" action or if the disc simply shatters in place.

Technical Questions

A key factual question is whether the accused AirGlide tool incorporates the structural limitation of "a region ... [with a] larger internal diameter than the internal diameter of the casing string" where the disc is attached, as required by claim 28. The external marketing image provided in the complaint does not show a cross-section of the device, so it does not resolve whether this specific internal geometry is present (Compl. ¶20).

V. Key Claim Terms for Construction

"disengage from sealing engagement"

Context and Importance

This term appears central to how the patented device is distinguished from merely bursting a disc. The patent's specification consistently describes a mechanism that first releases the disc, which then travels and shatters upon impact. Practitioners may focus on this term because its construction will determine whether infringement requires proof of this specific two-step physical sequence, or if a more general, one-step pressure rupture could meet the limitation.

Intrinsic Evidence for Interpretation

• Evidence for a Broader Interpretation: A party could argue that the plain language of the claim does not explicitly require a time-separated, two-step sequence or movement prior to rupture, only that the disc ceases its sealing function ("disengages").
• Evidence for a Narrower Interpretation: The specification provides strong support for a narrower, sequential definition, stating, "hydraulic pressure causes disruption or shearing of the securing mechanism, such that the rupture disc is shattered by engagement against an impact surface" (’445 Patent, col. 2:15-18). This language suggests that the "disruption or shearing" (disengagement) is the cause that leads to the subsequent shattering event.

"a region of the tubular member where the rupture disc is attached has a larger internal diameter than the internal diameter of the casing string"

Context and Importance

This structural limitation is directly tied to a stated objective of the invention: to restore the "full casing ID" after the disc is ruptured, allowing downhole tools to pass without obstruction (’445 Patent, col. 1:40-44). Proving infringement will require factual evidence that the accused device possesses this specific geometry.

Intrinsic Evidence for Interpretation

• Evidence for a Broader Interpretation: Parties are unlikely to dispute the plain meaning of "larger internal diameter." The dispute will center on factual evidence rather than interpretation.
• Evidence for a Narrower Interpretation: The patent specification and figures consistently illustrate this feature, for example, by describing "a widened region of the casing" (’445 Patent, col. 6:67-col. 7:1) and depicting it in diagrams (e.g., ’445 Patent, Fig. 2, items 25, 29). This provides a clear, unambiguous basis for its construction.

VI. Other Allegations

Indirect Infringement

The complaint alleges both inducement and contributory infringement. The inducement claim is based on allegations that Entech, with knowledge of the ’445 Patent, provides Halliburton with assembly drawings and manufacturing specifications, thereby encouraging the manufacture and use of the allegedly infringing AirGlide (Compl. ¶30). The contributory infringement claim is based on allegations that Entech ships components specifically made for the AirGlide that are a material part of the invention and have no substantial non-infringing uses (Compl. ¶31).

Willful Infringement

The complaint alleges willful infringement based on Entech's knowledge of the ’445 Patent since at least December 1, 2022, when its counsel allegedly contacted Plaintiff's counsel (Compl. ¶32). To support the claim of a "known or obvious risk," the complaint further alleges that Entech is aware of two separate 2022 jury verdicts finding the ’445 Patent infringed and not invalid in lawsuits against other parties making "virtually identical flotation subs" (Compl. ¶32).

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

• A core issue will be one of claim construction: does the claim term "disengage from sealing engagement" require a two-part mechanical sequence of release-then-impact, as described in the patent's preferred embodiments, or can it be read more broadly to cover a single-event pressure rupture? The outcome of this interpretation will significantly shape the infringement analysis.
• A second key issue will be one of evidentiary proof: does the accused AirGlide device contain the specific internal geometry recited in claim 28, namely, a widened section for housing the rupture disc? The complaint's allegations will need to be substantiated with technical evidence from the physical product itself.
• Finally, the allegation that Entech knew of two recent jury verdicts upholding the validity and infringement of the ’445 Patent against similar products raises a significant question of willfulness: if infringement is found, the court will have to determine whether Entech's conduct was egregious enough to warrant enhanced damages, given this alleged prior knowledge.