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Oil Field Technology Patents Invalidated

Somewhere beneath the ocean floor, oil pools in rich supply.

On the surface, oil companies fight over the technology to get it. In WesternGeco LLC v. Ion Geophysical Corporation, an appeals court declared a winner.

The U.S. Federal Circuit Court of Appeals said three WesternGeco patents for finding suboceanic oil were invalid. The winner claims it conquered a leviathan.

'David and Goliath'

After losing an inter partes review by the Patent Trial and Appeals Board, WesternGeco appealed to the Federal Circuit. Judge Raymond Chen, writing for the court, said "substantial evidence" supported the board's decision.

The appeals court affirmed a finding that the patents were invalid based on the "obviousness" of the technology. WesternGeco, a subsidiary of oil giant Schlumberger, had argued the challenges weren't even timely under 35 U.S.C. Section 315(b).

However, the appeals panel said, the one-year statute did not apply because the challengers were not "privies" in law. David Hanson, president of Ion Geophysical, said the decision confirmed his company's rights to the technology.

"This is clearly a David and Goliath situation with Schlumberger's unlimited resources, but we have been diligently fighting this case for over eight years," he said.

Damages to Go

The Federal Circuit also undercut most of the claims that WesternGeco won in a related matter. A federal district judge had awarded lost profits against Ion in 2015.

The appeals court, however, said in a separate decision that foreign lost profits arising from prohibited combinations are not available under 35 U.S.C. Section 271(f).

That case has been submitted to the U.S. Supreme Court, which is expected to rule by June.

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