Free Brief - District Court of Colorado - Colorado

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO Civil Action No. 03-M-2579 (RPM) VARCO, L.P., Plaintiff, vs. PASON SYSTEMS USA CORP., Defendant. PLAINTIFF'S OPENING MARKMAN BRIEF Plaintiff Varco, L.P. ("Varco") files this Markman brief as stated hereinabove and would respectfully show the Court as follows: This is a patent case. The Court' Amended Docket Control Order [Dkt# 135] s establishes January 5, 2007, as the date Varco's Markman brief is to be filed. This Markman brief is being filed pursuant to that order. Respectfully submitted, Dated: January 5, 2007 By:__/s/ Robert M. Bowick _________ Robert M. Bowick M ATTHEWS , LAWSON , B OWICK & A L-AZEM , PLLC 2000 Bering, Suite 700 Houston, Texas 77057 (713) 355-4200 (telephone) (713) 355-9689 (facsimile) COUNSEL FOR PLAINTIFF VARCO, L.P.

Jane Michaels Joseph T. Jaros H OLLAND & H ART LLP 555 Seventeenth Street, Suite 3200 Post Office Box 8749 Denver, Colorado 80201-8749 (303) 295-8000

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CERTIFICATE OF SERVICE I certify that on January 5, 2007, I served a copy of the foregoing document to the following by: U.S. Mail, postage prepaid with responsive documents Hand Delivery Fax, without initial disclosure documents ECF Transmission Barbara Weil Laff Mark E. Haynes IRELAND, STAPLETON, PRYOR & PASCOE, P.C. 1675 Broadway, Street 2600 Denver, Colorado 80202

_/s/ Robert M. Bowick ___________ Robert M. Bowick

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TABLE OF CONTENTS I. II. NATURE OF THE CASE................................................................1 CLAIM CONSTRUCTION STANDARDS...........................................5 A. Claim Construction Focuses on the Meaning of the Claim Language to One of Ordinary Skill in the Art......................6 The Specification is Often the Best Source for Determining The Meaning of a Claim Term, So Long as Limitations Are Not Improperly Read Into the Claims...................................9 The Prosecution History Can Both Confirm a Broad Ordinary Meaning or Reflect a Disclaimer of Claim Scope.............10 Extrinsic Evidence Is Also Useful In Interpreting Claims...............11

B.

C.

D. III.

THE INTRINSIC EVIDENCE OF THE ` PATENT..........................13 142 A. B. C. THE ASSERTED CLAIMS OF THE ` PATENT....................13 142 THE SPECIFICATION OF THE ` PATENT.........................16 142 THE PROSECUTION FIRL HISTORY OF THE ` PATENT.....................................................................21 142

IV.

VARCO' CLAIM CONSTRUCTION...............................................25 S A. " drilling fluid pressure regulator" A ........................................26 1. 2. B. C. D. " Drilling Fluid Pressure" .............................................26 " Regulator" ..............................................................27

" Coupled" .........................................................................29 " Measuring" ......................................................................32 " Changes in drilling fluid pressure" .........................................33 1. 2. " Changes" ................................................................33 " Drilling Fluid Pressure" .............................................36

E.

" Outputting a signal" ...........................................................36

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1. 2. F. G. H.

" Outputting" ...........................................................36 " Signal" ..................................................................37

" Representing" " or Represents" .............................................38 " Relay" .............................................................................40 " drill string control signal" A .................................................45 1. 2. 3. " Drill String" ............................................................46 " Control" .................................................................47 " Signal" ...................................................................47

I. J.

" an output thereof" At ..........................................................47 " drill string controller" A ......................................................48 1. 2. " Drill String" ............................................................48 " Controller" ..............................................................48

K.

" decrease in drilling fluid pressure" A ......................................50 1. 2. " Decrease" ...............................................................50 " Drilling Fluid Pressure" .............................................51

L. M.

" Operates" ........................................................................51 " increase in the rate of release of said drill string" An ..................52 1. 2. 3. " Increase" ................................................................52 " Rate of Release" .......................................................53 " Drill String" ............................................................55

N.

" increase in drilling fluid pressure" An .....................................55 1. 2. " Increase" ................................................................55 " Drilling Fluid Pressure" .............................................55

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O.

" decrease in the rate of release of said drill string" A or " decrease the rate of release of said drill string" ......................55 1. 2. 3. " Decrease" ...............................................................55 " Rate of Release" .......................................................55 " Drill String" ............................................................55

P.

" Producing a signal in response to" or " ; producing a first signal in response to" ............................................................55 1. 2. 3. " Producing" ..............................................................56 " Signal" ...................................................................56 " Response To" In .......................................................56

Q.

" Said signal" " or Said First Signal" .........................................56 1. 2. " Said" " or Said First" .................................................57 " Signal" ...................................................................57

R. S. T. U.

" Relaying" ........................................................................57 " Operating" .......................................................................59 " Weight" Bit ......................................................................60 " Producing a second signal in response to" ................................65 1. 2. 3. 4. " Producing" ..............................................................65 " Second" ..................................................................65 " Signal" ...................................................................65 " Response To" In .......................................................65

V.

" Changes in bit weight" ........................................................65 1. 2. " Changes" ...............................................................65 " Weight" Bit ............................................................65

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W. X. Y. Z.

" Said second signal" ............................................................66 " Selecting" ........................................................................66 " Any one ... and both" .........................................................67 " Control the release of said drill string" ...................................68 1. 2. 3. " Control" .................................................................68 " Release" .................................................................69 " Drill String" ............................................................69

AA.

" Said selected signal or signals" ..............................................69 1. 2. " Selected" ................................................................69 " Signal or Signals" .....................................................69

BB.

" Regulates the release of said drill string" .................................70 1. 2. 3. " Regulates" ..............................................................70 " Release" ..................................................................71 " Drill String" ............................................................71

V.

CONCLUSION............................................................................71

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TABLE OF AUTHORITIES Case Page

Bell Com. Research, Inc. v. Vitalink Com. Corp., 55 F.3d 615, 620 (Fed.Cir. 1995)..................................................7 C.R. Bard, Inc. v. U.S. Surgical Corp., 388 F.3d 858, 864 (Fed.Cir.2004)...................................................42, 58 Callicrate v. Wadsworth Mfg., Inc., 427 F.3d 1361, 1372 (Fed.Cir. 2005)......................................................5 CCS Fitness, Inc. v. Brunswick Corp., 288 F.3d 1359, 1366 (Fed.Cir. 2002).......................................... 7, 8 Digital Biometrics, Inc. v. Identix, Inc., 149 F.3d 1335, 1344 (Fed.Cir. 1998)................................. .10, 43, 58 E.I. du Pont de Nemours & Co. v. Phillips Petroleum, 849 F.2d 1430, 1433 (Fed.Cir. 1988).............................................6 Gart v. Logitech, Inc., 254 F.3d 1334, 1342 (Fed.Cir.2001)................................................43, 59 Gemstar-TV Guide Int'l, Inc. v. Int'l Trade Comm'n, 383 F.3d 1352, 1366 (Fed. Cir. 2004)...................................................10 Gillette, 405 F.3d at 1374.......................................................................43, 59 Innova/Pure Water, Inc. v. Safari Water Filtration Systems, Inc., 381 F.3d 1111 (Fed. Cir. 2004)......................................................5, 7, 9 Johnson & Johnson Assoc. Inc. v. R.E. Serv. Co., 285 F.3d 1046, 1052-53 (Fed.Cir. 2002)................................................59 Johnson Worldwide Associates, Inc. v. Zebco Corp., 175 F.3d 985 (Fed.Cir. 1999)............................................................32 Key Pharms. v. Hercon Labs. Corp., 161 F.3d 709, 716 (Fed.Cir.1998).......................................................32 Laitram Corp. v. Cambridge Wire Cloth Co., 863 F.2d 855, 865 (Fed.Cir.1988)........................................................12 Laitram Corp. v. Morehouse Indus. Inc., 143 F.3d 1456, 1461 (Fed.Cir. 1998)....................................... 43, 59

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Liebel-Flarsheim Co. v. Medrad, Inc., 358 F.3d 898, 906 (Fed. Cir. 2004).......................................................9 Markman v. Westview Instruments, Inc., 52 F.3d 967 (Fed. Cir. 1995)...............................................................5 Moll v. Northern Telecom, Inc., 119 F.3d 17 (Fed.Cir. 1997)..............................................................33 Omega Eng=g., Inc. V. Raytek Corp., 334 F.3d 1314, 1324 (Fed.Cir. 2003).................................................7, 11 Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005).......................................5, 6, 7, 8, 9, 10, 12 Pitney Bowes, Inc. v. Hewlett-Packard Co., 182 F.3d 1298, 1308-09 (Fed.Cir.1999)................................................12 Primos, Inc. v. Hunter'Specialties, Inc., s 451 F.3d 841, 848 (Fed.Cir. 2006)......................................................45 Robotic Vision Sys., Inc. v. View Eng., Inc., 19 F.3d 1370 (Fed.Cir. 1999)............................................................33 SanDisk Corp. v. Memorex Prods., Inc., 415 F.3d 1278, 1286 (Fed.Cir.2005)................................................43, 59 Seymour v. Osborne, 78 U.S. (11 Wall.) 516, 546, 20 L.Ed. 33 (1870).....................................12 Smithkline Diagnostics, Inc. v. Helena Labs. Corp., 859 F.2d 878, 882 (Fed.Cir. 1988)................................................ 7 Southwall Tech., Inc. V. Carding IG Co., 54 F.3d 1570, 1576 (Fed.Cir. 1995)......................................................11 Sunrace Roots Enter. Co. v. SRAM Corp. , 336 F.3d 1298, 1302 (Fed. Cir. 2003)...................................................8 Tehrani v. Hamilton Med., Inc., 331 F.3d 1351, 1361 (Fed.Cir. 2003)....................................................40 Teleflex, Inc. v. Ficosa N. Am. Corp., 299 F.3d 1313, 1325 -26 (Fed.Cir. 2002).............................. .7, 10, 12 Texas Digital Systems, Inc. v. Telegenix, Inc., 308 F.3d 1193 (Fed.Cir. 2002).............................................................6

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Texas Instruments, Inc. v. U.S. Int =l Trade Comm=n, 805 F.2d 1558, 1563 (Fed.Cir.1986)................................................43, 59 Ultra-Tex Surfaces, Inc. v. Hill Brothers Chemical Co., 204 F.3d 1360, 1367 (Fed.Cir.2000)................................................10, 28 Varco, L.P. v. Pason Sys. USA Corp., 436 F.3d 1368 (Fed.Cir. 2006).............................................1, 4, 58, 66, 67 Vitronics Corp. v. Conceptronic, Inc., 90 F.3d 1576 (Fed. Cir. 1996)..............................................5, 6, 7, 10, 12 Warner-Jenkinson Co. v. Hilton Davis Chem. Co., 520 U.S. 17, 30 (1997)....................................................................11 ZMI Corp. v. Cardiac Resuscitator Corp., 844 F.2d 1576, 1580 (Fed.Cir. 1988)....................................................10 Statutes Page

35 U.S.C. § 102......................................................................................24 35 U.S.C. § 103........................................................................21, 22, 23, 24 35 U.S.C. § 112..........................................................................6, 21, 23, 24 35 U.S.C. § 284.......................................................................................3

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I.

NATURE OF THE CASE

The ` Patent (U.S. Patent No. 5,474,142), a copy of which is attached as Exhibit 1 142 hereto, can generally be described as covering an automatic drilling system designed for controlling the rate of release of the drill string into a well. Varco has identified claims 1, 11 and 14 of the ` Patent as being infringed by Pason. 142 Claims 1, 11, and 14 are independent claims (claims standing alone). This Court has previously addressed the claim construction of the disputed terms of Claim 14 during a preliminary injunction hearing held in July 2004. The Court denied the injunction based upon its

interpretation of the terms " relaying"and " selecting" --holding that Varco could not show a likelihood of success under the Court'construction. Varco appealed and the Court of Appeals s for the Federal Circuit (CAFC) reversed the Court' interpretation and remanded the case for s further proceedings. See Varco, L.P. v. Pason Sys. USA Corp., 436 F.3d 1368 (Fed.Cir. 2006). To better understand the significance of claim construction issues, Varco has presented its Markman brief in the context of how claim construction will impact the ultimate issue of patent infringement. This is consistent with the Court'preference in that " don'know the s you t significance of the [claim construction] dispute until you' talking about infringement and re validity."See Ex. 20, Pg. 9, ll. 15-16. As the Court will recall, Pason'only basis for non-infringement of Claims 11 and 14 of s the ` Patent was its contention that its AutoDriller did not perform the step of " 142 relaying" or " selecting." Specifically, Pason' designated technical expert witness, Mr. J. Ford Brett, s conceded infringement of Claims 11 and 14 if " relaying"was interpreted broadly to mean to " convey" " along" or pass (i.e., Varco'proffered interpretation). See Ex. 18, Pason'technical s s expert'testimony provided as follows: s 1

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6-1-04 Deposition Transcript, Page 24, ll. 13-16: " A: If you say ­if you' talking about relay in terms of the broad definition, re Pason infringes, so I don'know what else you want me to say about t that."

6-1-04 Deposition Transcript, Page 25, ll. 10-19: " Q: But it' your opinion that claim 11 is infringed by Pason' AutoDriller s s device with that interpretation [communicate or transmit] of relaying? With that interpretation of relaying, which is the word there, then Pason infringes, that'true. s How about claim 14? Same thing. That claim 14 infringes with that same definition of relay? Right. Same thing." ;

A:

Q: A: Q: A:

See also, 7-7-04 Prel. Injunction Hearing Transcript I, Page 124, lines 1-4: Direct Examination " Laff: Ms. If there was a broader construction of Claim 14, where "relaying" meant communicate, is it possible that [Pason's] autodriller would then infringe Claim 14?" I don't even--I don't say possible, I say probable." ;

Mr. Brett:

See also, Ex. 16, Pason'Technical Expert'May 31, 2004 Report, Page 14: s s "` If Relaying' interpreted in the general ` is convey' sense, then the Pason AutoDriller does indeed fall within the scope of these claims. As mentioned above, the general ` convey' sense Claims 11 and 14, are quite broad." Thus, Pason'designated technical expert witness, a person Pason contends is of ordinary s skill in the relevant art, has testified that Pason' AutoDriller performs each and every step of s Claims 11 and 14, with the exception of the " relaying" step as interpreted by Varco. 2

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Additionally, Pason' patent counsel1, Mr. Terry Leier, provided Pason as well as its s designated technical expert an opinion that the Pason' AutoDriller indeed infringes the ` s 142 Patent. See Ex. 22, which provides as follows: "Consequently, the technical explanation appears to be that Pason system operates within the parameters of claim 14 at least some of the time. Unless there is a basis to invalidate the claim, the operation of Pason system appears to fall within the scope of the claim. Therefore, if there is a Markman/construction hearing that affirms the claim, there does not seem to me to be any other defense issues." Moreover, the Federal Circuit has already reviewed this language (i.e., " relaying"& " selecting" as the only disputed claim language and all discovery was taken with this isolated ) language in dispute. Now, in the 11th hour of this lawsuit and contrary to the opinions and testimony provided by both Pason' patent counsel and designated expert, Pason has conjured up a new nons infringement position claiming that its AutoDriller does not include or perform at least 28 elements of the asserted claims. See Ex. 21--Pason'12-13-06 Designation of terms requiring s interpretation. Pason'ruse makes it necessary for this Court to construe each of the 28 terms or s phrases designated by Pason for interpretation in a transparent attempt to created the " wiggle room"Pason so desperately seeks following both the Federal Circuit' and the United States s Patent and Trademark Office' (PTO) rejection of Pason' prior defenses. Further, Pason has s s reneged on its representation to this Court that it would not waste the Court' time with the s arduous task of construing nearly each and every term of the asserted claims. See Ex. 20, 3-2106 Hearing Transcript Pg. 6, ll. 3-12, provided as follows:

1

Pason has waived the attorney client privilege with respect to its patent counsel'opinions as a s defense to willful infringement (35 U.S.C. § 284). 3

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THE COURT:

Yeah. And, you know, they [the CAFC] did say on remand, this Court should consider the proper interpretation of Claim 14. So, they didn'say do this. But, on the other hand, I don'see where t t the wiggle room is anymore. We are looking for that [i.e., wiggle room] and I certainly would anticipate presenting it if we see it. And, if we don'see it, quite t frankly, Your Honor, we would not waste the Court'time in s terms--and, move directly into the broad issue as to whether or not the patents are infringed upon, or invalid on that construction.

MR. ATKINSON:

Even more outrageous is Pason blind determination to maintain its position that the claims of the ` Patent are limited to the preferred embodiment of the ` Patent--a position 142 142 wholly rejected by the CAFC. See Ex. 17, Pason' Technical Expert' 9-4-06 Report, Page 13 s s (" [Pason] AutoDriller does not follow the teaching of Claim 14, which appears to reflect the the precise control scheme of regulators and dedicated relays, producing distinct, proportionate control signals responsive to changes from calibrated values." Furthermore, Pason'proferred ). s interpretation flies in the face of its earlier representations in this case not only before the CAFC but also the PTO. See Varco, 436 F.3d at 1375 (" addition, Pason=s counsel at oral argument In similarly conceded that relaying in claim 14 should not be limited to pneumatically operated valves" See also, Ex. 2, Pason'1/27/04 Ex Parte Reexamination Request (" 409-10" (The ); s WS ) ` Patent " not drawn to the specific apparatus disclosed in the Bowden disclosure, but rather 142 is recites terms that encompass a variety of other embodiments of apparatus including electrical implementations" and " not drawn to method steps performed using the specific apparatus ; is disclosed in the Bowden disclosure, but rather recites the steps using terms that may be practiced by a variety of other apparatus embodiments such as the electrical and drilling fluid pressure implementations." ).

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In view of Pason' admissions including positions taken before the PTO and CAFC, s Varco contends that the laborious task of interpreting each and every element of the asserted claims is unnecessary. See, e.g., Callicrate v. Wadsworth Mfg., Inc., 427 F.3d 1361, 1372 (Fed.Cir. 2005) (Competitor accused of infringing patents for animal castration tool was bound by admissions in final pretrial order that its accused devices included all claim limitations, even after appellate court found error in claim constructions under which admissions were made.) Nevertheless, Varco hereby provides all necessary support for its construction of these 28 newly contested elements despite Pason'admissions that most if not all of the elements of the asserted s claims are contained in and/or practiced by Pason'AutoDriller. s II. CLAIM CONSTRUCTION STANDARDS

Claim construction is the first of two steps required to determine infringement. In the claim construction step, the court determines ­as a matter of law ­the meaning and scope of the patent claims. Following the claim construction, the judge or jury can then determine ­as a matter of fact ­whether the claims as properly construed read on the accused infringer' product or method; or in other words, is infringed. s Laitram Corp. v. Morehouse Indus. Inc., 143 F.3d 1456, 1461 (Fed.Cir. 1998). In Phillips v. AWH Corp., 415 F.3d 1303 (Fed. Cir. 2005) (en banc), the Federal Circuit reaffirmed principles of claim construction that it had outlined in earlier cases such as Vitronics Corp. v. Conceptronic, Inc., 90 F.3d 1576 (Fed. Cir. 1996); Innova/Pure Water, Inc. v. Safari Water Filtration Systems, Inc., 381 F.3d 1111 (Fed. Cir. 2004); and Markman v. Westview Instruments, Inc., 52 F.3d 967 (Fed. Cir. 1995) (en bane), aff'd, 517 U.S. 370 (1996); and

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clarified its decision in Texas Digital Systems, Inc. v. Telegenix, Inc., 308 F.3d 1193 (Fed.Cir. 2002)2. When interpreting an asserted claim, "the court should look first to the intrinsic evidence of record, i.e., the patent itself, including the claims, the specification and, if in evidence, the prosecution history." Vitronics Corp. v. Conceptronics, Inc., 90 F.3d 1576, 1582 (Fed.Cir. 1996); Phillips, 415 F.3d at 1313. Extrinsic evidence such as expert testimony may be considered, but it is less significant than the intrinsic record [Phillips, 415 F.3d at 1317], and in most situations "an analysis of the intrinsic evidence alone will resolve any ambiguity in a disputed claim term'' [Vitronics, 90 F.3d at 1583]. Both the intrinsic and extrinsic evidence sources are examined in order below. A. Claim Construction Focuses on the Meaning of the Claim Language to One of Ordinary Skill in the Art Although the ` Patent can generally be described as covering an Automatic 142 Drilling System, the precise scope of the inventions covered by the patent is determined by the language of the patent' claims: s " The claims of the patent provide the concise formal definition of the invention. They are numbered paragraphs which ` particularly [point] out and distinctly [claim] the matter which the applicant regards as his invention.' 35 U.S.C. § 112. It is to these wordings that one must look to determine whether there has been infringement. [Footnote omited]. E.I. du Pont de Nemours & Co. v. Phillips Petroleum, 849 F.2d 1430, 1433 (Fed.Cir. 1988).
2

The Federal Circuit clarified its earlier decisions which stated that the first step in determining the ordinary and customary meaning of claim terms is to examine relevant dictionaries, encyclopedias and treatises, See Texas Digital Sys., Inc. v. Telegenix, Inc., 308 F.3d 1193, 1205 (Fed.Cir. 2002); and held that the written description and file history should be consulted prior to examining extrinsic evidence. However, the Federal Circuit noted that the order of examination of evidence is of no consequence. 6

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To properly construe the claims of a patent and thus the scope of the invention, claim interpretation begins with the language of the claim itself. Bell Com. Research, Inc. v. Vitalink Com. Corp., 55 F.3d 615, 620 (Fed.Cir. 1995); Smithkline Diagnostics, Inc. v. Helena Labs. Corp., 859 F.2d 878, 882 (Fed.Cir. 1988). The focus and starting point for the analysis is thus the claim language itself, as the Federal Circuit has stated: " indulge a ` We heavy presumption' that claim terms carry their full ordinary and customary meanings, CCS Fitness, Inc. v. Brunswick Corp., 288 F.3d 1359, 1366 (Fed.Cir. 2002), unless the patentee unequivocally imparted a novel meaning to those terms or expressly relinquished claim scope during prosecution, see Teleflex, Inc. v. Ficosa N. Am. Corp., 299 F.3d 1313, 1325-26 (Fed.Cir. 2002)." Omega 334 F.3d at 1324. "It is a 'bedrock principle' of patent law that 'the claims of a patent define the invention to which the patentee is entitled the right to exclude.''' Phillips, 415 F.3d at 1312 (quoting Innova, 381 F.3d at 1115). The Court looks first "to the words of the claims themselves ... to define the scope of the patented invention.'' Vitronics, 90 F.3d at 1582. "The written description part of the specification itself does not delimit the right to exclude. That is the function and purpose of claims.'' Markman, 52 F.3d at 980. Thus, "the words of a claim 'are generally given their ordinary and customary meaning,''' which is "the meaning that the term would have to a person of ordinary skill in the art in question at the time of the invention.'' Phillips, 415 F.3d at 1312-13 (citation omitted). "In some cases, the ordinary meaning of claim language as understood by a person of skill in the art may be readily apparent even to lay judges, and claim construction in such cases involves little more than the application of the widely accepted meaning of commonly understood words." Id. at 1314. "In 7

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such circumstances, general purpose dictionaries may be helpful.'' Id. Indeed, the Federal Circuit has "repeatedly stated that claim terms must be given their ordinary and accustomed meaning unless the patent expresses an intention to impart novel meaning to claim terms.'' Sunrace Roots Enter. Co. v. SRAM Corp., 336 F.3d 1298, 1302 (Fed. Cir. 2003). The Court thus "indulge[s] a 'heavy presumption' that a claim term carries its ordinary and customary meaning.'' CCS Fitness, Inc. v. Brunswick Corp., 288 F.3d 1359, 1366 (Fed. Cir. 2002) (citation omitted). Claims "must be understood and interpreted by the court as they would be understood and interpreted by a person in [the relevant] field of technology." Phillips v. AWH Corp., 415 F.3d 1303, 1313 (Fed.Cir. 2005)(en banc)(citations omitted). Therefore, a claim term should be interpreted as having a meaning a person of ordinary skill in the field of the invention would give it. Id. Varco asserts that the hypothetical person having ordinary skill in the art relating to the ` Patent would possess certain specialized technical skills, would 142 have competent technical training and familiarity in the onshore and offshore oil and gas exploration industry including some relevant and personal experience with electro-mechanical control systems. See Ex. 15, Expert Report of Gregg Perkin, Pg. 8, ¶19. Varco' interpretation of the disputed claim terms is provided as they would s have been understood by this hypothetical person at the time of the invention of the ` Patent--April 1993. 142

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B.

The Specification is Often the Best Source for Determining the Meaning of a Claim Term, So Long as Limitations are Not Improperly Read Into the Claims The patent specification " may act as a sort of dictionary, which explains the invention and may define terms used in the claims."Markman, 52 F.3d at 986. However, Courts must not import limitations from the specification into the claims; and claims must not be limited to a preferred embodiment absent a clear disavowal of claim scope. Courts should review the

intrinsic evidence, including the remainder of the specification and the prosecution history, to clarify language that is ambiguous on its face and to see if the patentee may have used a term idiosyncratically. Phillips, 415 F.3d at 1314. In particular, the specification may show that the patentee used a special definition (acted as his own lexicographer), or it "may reveal an intentional disclaimer, or disavowal, of claim scope by the inventor.'' Id. at 1316. In short, claims "must be read in view of the specification, of which they are a part." Id. at 1315 (citation omitted). Nevertheless, it is important to avoid "one of the cardinal sins of patent law--reading a limitation from the written description into the claims.'' Id. at 1320 (citation omitted). Thus, "particular embodiments appearing in the written description will not be used to limit claim language that has broader effect.'' Innova, 381 F.3d at 1117; see also Phillips, 415 F.3d at 1323 ("although the specification often describes very specific embodiments of the invention, we have repeatedly warned against confining the claims to those embodiments''). In particular, "even where a patent describes only a single embodiment, claims will not be "read restrictively unless the patentee has demonstrated a clear intention to limit the claim scope using "words or expressions of manifest exclusion or restriction.''' Innova, 381 F.3d at 1117 (quoting Liebel-Flarsheim Co. v. Medrad, Inc., 358 F.3d 898, 906 (Fed. Cir. 2004); and 9

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Teleflex, Inc. v. Ficosa N. Am. Corp., 299 F.3d 1313, 1327 (Fed. Cir. 2002)). The Federal Circuit has "expressly rejected the contention that if a patent describes only a single embodiment, the claims of the patent must be construed as being limited to that embodiment.'' Phillips, 415 F.3d at 1323 (citing Gemstar-TV Guide Int'l, Inc. v. Int'l Trade Comm'n, 383 F.3d 1352, 1366 (Fed. Cir. 2004)). C. The Prosecution History Can Both Confirm a Broad Ordinary Meaning or Reflect a Disclaimer of Claim Scope The prosecution history contains the record of all proceedings before the Patent Office leading to the grant of the patent and may include express representations made regarding the scope of the claims. Digital Biometrics, Inc. v. Identix, Inc., 149 F.3d 1335, 1344 (Fed.Cir. 1998); Vitronics, 90 F.3d at 1582. Courts "should also consider the patent's prosecution history, if it is in evidence,'' because it "provides evidence of how the PTO and the inventor understood the patent.'' Phillips, 415 F.3d at 1317 (quoting Markman, 52 F.3d at 980). Statements in the prosecution history are "often of critical significance in determining the meaning of the claims,'' as they can either confirm a broad meaning or show that the inventor disclaimed certain coverage during the course of the prosecution. Vitronics, 90 F.3d at 1582; see also Phillips, 415 F.3d at 1317). The PTO Examiner's remarks are often significant because Examiners are presumed to have experience in interpreting patents and other references and to be familiar with the level of skill in the art based upon their experience in the art. Ultra-Tex Surfaces, Inc. v. Hill Brothers Chemical Co., 204 F.3d 1360, 1367 (Fed.Cir.2000). The purpose of consulting the prosecution history in construing a claim is to Aexclude any interpretation that was disclaimed during prosecution.@ ZMI Corp. v. Cardiac Resuscitator Corp., 844 F.2d 1576, 1580 (Fed.Cir. 1988). The doctrine of " prosecution disclaimer"­ which is well-established in both Supreme Court and Federal Circuit precedent ­ 10

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holds that, " where the patentee has unequivocally disavowed a certain meaning to obtain his patent, the doctrine of prosecution disclaimer attaches and narrows the ordinary meaning of the claim congruent with the scope of the surrender." Omega, 334 F.3d at 1324. Accordingly, only Awhere the patentee has unequivocally disavowed a

certain meaning to obtain his patent, the doctrine of prosecution disclaimer attaches and narrows the ordinary meaning of the claim congruent with the scope of surrender.@ Omega Eng=g., Inc. V. Raytek Corp., 334 F.3d 1314, 1324 (Fed.Cir. 2003). Such a use of the prosecution history ensures that claims are not construed one way in order to obtain their allowance and in a different way against accused infringers. Southwall Tech., Inc. V. Carding IG Co., 54 F.3d 1570, 1576 (Fed.Cir. 1995). Prosecution disclaimer applies to the determination of literal infringement by excluding from the claim construction any claim scope that has been clearly and unmistakably disavowed during prosecution. Omega Eng'g, Inc. v. Raytek Corp., 334 F.3d 1314, 1323 (Fed.Cir. 2003). The Federal Circuit has repeatedly emphasized the standard for claim interpretation under the doctrine: "[F]or prosecution disclaimer to attach, our precedent requires that the alleged disavowing actions or statements made during prosecution be both clear and unmistakable." Id. at 1325-26 (emphasis supplied). The prosecution history is also significant for determining the scope or range the claim elements are entitled to under the doctrine of equivalents during the infringement analysis. See Warner-Jenkinson Co. v. Hilton Davis Chem. Co., 520 U.S. 17, 30 (1997). D. Extrinsic Evidence Is Also Useful In Interpreting Claims While the Federal Circuit has emphasized the importance of intrinsic evidence in claim construction, it may also be helpful to rely on extrinsic evidence, which " consists of all evidence 11

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external to the patent and prosecution history, including expert and inventor testimony, dictionaries, and learned treatises."Markman, 52 F.3d at 980, citing Seymour v. Osborne, 78 U.S. (11 Wall.) 516, 546, 20 L.Ed. 33 (1870); see also Vitronics, 90 F.3d at 1583. Within the class of extrinsic evidence, Courts have observed that dictionaries and treatises can be useful in claim construction. Phillips, 415 F.3d at 1318 (citations omitted). These extrinsic sources may help a court " better understand the underlying technology" the way in which one of skill to and in the art might use the claim terms. Id. citing Vitronics, 90 F.3d at 1584 n. 6. Because dictionaries, and especially technical dictionaries, endeavor to collect the accepted meanings of terms used in various fields of science and technology, those resources have been properly recognized as among the many tools that can assist the court in determining the meaning of particular terminology to those of skill in the art of the invention. See Id. citing Teleflex, Inc. v. Ficosa N. Am. Corp., 299 F.3d 1313, 1325 (Fed.Cir.2002). Such evidence may be considered if the court deems it helpful in determining " true meaning of language used in the patent the claims." Markman, 52 F.3d at 980. Additionally, extrinsic evidence in the form of expert testimony can be useful to a court for a variety of purposes, such as to provide background on the technology at issue, to explain how an invention works, to ensure that the court's understanding of the technical aspects of the patent is consistent with that of a person of skill in the art, or to establish that a particular term in the patent or the prior art has a particular meaning in the pertinent field. See Phillips, 415 F.3d at 1318, citing Pitney Bowes, Inc. v. Hewlett-Packard Co., 182 F.3d 1298, 1308-09 (Fed.Cir.1999); Key Pharms. v. Hercon Labs. Corp., 161 F.3d 709, 716 (Fed.Cir.1998).

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III. A.

THE INTRINSIC EVIDENCE OF THE ` PATENT 142

THE ASSERTED CLAIMS OF THE ` PATENT 142 Varco has accused Pason of infringing independent Claims 1, 11 and 14 of the ` 142 Patent. Claim 1 is an apparatus claim covering an automatic drilling system that regulates the rate of release based upon drilling fluid pressure. Claims 11 and 14 are method claims that cover a method of regulating the rate of release of the drill string in response to drilling fluid pressure and drilling fluid pressure with or without weight on bit, respectively. The asserted claims are provided as follows with the disputed claim language emphasized and numbered for reference: 1. An automatic drilling system for automatically regulating the release of the drill string of a drilling rig during the drilling of a borehole, comprising:3

a drilling fluid pressure sensor4;

[1] a drilling fluid pressure regulator [2] coupled to said drilling fluid pressure sensor, said [1] drilling fluid pressure regulator [3] measuring [4] changes in drilling fluid pressure and [5] outputting a signal [6] representing those [4] changes;

3

Pason has admitted that its AutoDriller falls within the scope of this element. See Ex. 19, Pason'8-25-06 Responses to Plaintiff'First Set of Admissions Nos. 1 & 2. s s
4

Pason has admitted that its AutoDriller falls within the scope of this element. See Ex. 19, Pason'8-25-06 Responses to Plaintiff'First Set of Admissions No. 4. s s 13

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a [7] relay [2] coupled to said [1] drilling fluid pressure regulator, said [7] relay responsive to [5] the output signal of said [1] drilling fluid pressure regulator to supply a [8] drill string control signal [9] at an output thereof; and

[10] a drill string controller [2] coupled to said [7] relay wherein [11] a decrease in drilling fluid pressure results in said [7] relay supplying a [8] drill string control signal that [12] operates said [10] drill string controller to effect an [13] increase in the rate of release of said drill string and an [14] increase in drilling fluid pressure results in said [7] relay supplying a [8] drill string control signal that [12] operates said [10] drill string controller to effect a [15] decrease in the rate of release of said drill string. Ex. 1, ` Patent, Col. 24, ll. 37-58________________________________________________ 142 11. A method for automatically regulating the release of the

drill string of a drilling rig drill, comprising the steps of5:

measuring drilling fluid pressure6;

5

Pason has admitted that its AutoDriller falls within the scope of this element. See Ex. 19, Pason'8-25-06 Responses to Plaintiff'First Set of Admissions No. 3. s s
6

Pason has admitted that its AutoDriller falls within the scope of this element. See Ex. 19, Pason'8-25-06 Responses to Plaintiff'First Set of Admissions Nos. 4 & 5. s s 14

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[16] producing a signal in response to [4] changes in drilling fluid pressure, [17] said signal [6] representing the [4] changes in drilling fluid pressure;

[18] relaying [17] said signal to a [10] drill string controller; and

[19] controlling said [10] drill string controller to [13] increase the rate of release of said drill string when [17] said signal [6] represents [11] a decrease in drilling fluid pressure and to [15] decrease the rate of release of said drill string when [17] said signal [6] represents [14] an increase in drilling fluid pressure. Ex. 1, ` Patent, Col. 27, ll. 44-56________________________________________________ 142 14. A method for automatically regulating the release of the drill string of a drilling rig drill, comprising the steps of5:

[3] measuring drilling fluid pressure6 and [20] bit weight;

[16] producing a first signal in response to [4] changes in drilling fluid pressure, [17] said first signal [6] representing the [4] changes in drilling fluid pressure;

[21] producing a second signal in response to [22] changes in bit

15

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weight, [23] said second signal [6] representing the [22] changes in bit weight;

[24] selecting [25] any one of [17] said first signal, [23] said second signal, [25] and both [17] said first and [23] said second signals to [26] control the release of said drill string; and

[18] relaying [27] said selected signal or signals to a [10] drill string controller which [28] regulates the release said drill string in response to [27] said selected signal or signals. Ex. 1, ` Patent, Col. 28, ll. 23-38________________________________________________ 142 B. THE SPECIFICATION OF THE ` PATENT 142 The ` Patent relates to an automatic drilling system that controls the rate of release of 142 the drill string in response to any one, any combination of, or all of bit weight, drilling fluid pressure, drill string torque, and drill string RPM to achieve an optimal rate of bit penetration. Ex. 1, ` Patent, Abstract. These drilling parameters are measured with sensors that output 142 signals representing the individual properties being measured. Ex. 1, ` Patent, Col. 1, ll. 51142 67. One or more of these signals are then used by the automatic driller to direct the operation of a draw works of a drilling rig to control the rate of release of the drill string associated with the drilling rig. Figure 1 of the ` Patent (shown below) illustrates the general arrangement of a 142 drilling rig (10) that is controlled by this automatic driller (33).

16

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The drilling rig is equipped with several sensors. A pressure sensor (34) measures the drilling fluid pressure. Ex. 1, ` Patent, Col. 3, l. 55 ­Col. 4, l. 56. In Figure 1, the pressure 142 sensor is located on the standpipe, which is the length of pipe that stretches from the mud pump (25) to the flexible hose that attaches to the drill string (21). Other sensors include a bit weight sensor (35) attached to the drilling cable (28) near the cable anchor (27), a torque sensor (36) connected to the rotary table (24) of the drilling rig, and an RPM sensor (37) connected to the rotary table. Ex. 1, ` Patent, Col. 6, ll. 12-65. Each of these sensors is connected to the 142 automatic driller in the manner described below with reference to Figure 2 of the ` Patent. 142 Figure 1 also shows that the automatic driller is connected to a brake handle (208) of a draw works (22). The draw works is a system used to lower the drill string into the bore hole. In a typical draw works (and as shown and/or illustrated in the ` Patent), the drill string is at 142 17

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least partially suspended by cables from the derrick of the drilling rig. The cables are spooled by a cable drum, which may be powered by a motor. The motor is used to wind the cables on the drum and thereby lift the drill string. The drill string is lowered by the force of gravity, but a brake controls the rotational speed of the drum, thereby controlling the rate at which the drill string is lowered into the bore hole. As the bit drills through the earth, the drum must release cable to permit the drill string to be lowered into the bore hole. " Rate of release" refers to the rate or speed at which the drill string is lowered into the bore hole. The brake handle controls the amount of braking force applied to the drum (26) of the draw works, and thereby regulates the rate of release of the cables suspending the drill string. An automatic driller utilizes the signals sent from the sensors to the automatic driller to maintain the rate of release of the drill string near an optimum value. See Ex. 1, ` Patent, Col. 4, ll. 15-31, which provides as follows: 142 " Drawworks 22 must adjust drill string 21 vertically along derrick 20 in order to retain dill bit 23 ` bottom' on (i.e., on the bottom of borehole 86) and maintain the progression of borehole 86 though formation 87. As long as drill string 21 maintains a constant pressure on drill bit 23, drill bit 23 will gouge borehole 86 from formation 87 at an optimal rate of penetration chosen based upon the composition of formation 87. Rates of penetration vary from as little as four feet per hour to as much as one hundred and eighty feet per hour. If, however, drawworks 22 did not adjust drill string 21, drill bit 23 would rise ` bottom' off (i.e., off the bottom of borehole 86) and the progression of borehole 86 through formation 87 would cease. Accordingly, brake 32 must be manipulated to permit drum 26 to release cable 28 and adjust drill string 21, thereby providing the constant pressure on drill bit 23 required to maintain the optimal rate of penetration." Figure 2 of the ` Patent (shown below) illustrates the automatic driller of the preferred 142 embodiment.

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The automatic driller of the preferred embodiment (Figure 2 of the Bowden Patent) includes a series of pneumatic pressure regulators: drilling fluid pressure regulator (200), bit weight pressure regulator (201), drill string torque pressure regulator (202), and drill string RPM pressure regulator (203). Each of these pressure regulators receives a signal from its

corresponding sensor. The automatic driller also includes an air motor (204) that drives a differential gear (205). The differential gear (205) manipulates a cable reel (206) that raises and lowers the brake handle of the draw works. The brake handle adjusts the braking force applied to the drum, thereby controlling the rate of release of the drill string. Ex. 1, ` Patent, Col. 7, 142 Lines 16-25. Each of the pressure regulators includes a corresponding valve (236-239) that act as a relay that provide pneumatic signal(s) to an air motor. The air motor controls the rate of release of the drill string based on the pneumatic signal received from the valves. A compressed air source provides the compressed air that controls the motor. A flow regulator (212) limits the maximum pressure delivered to the valves, thereby limiting the maximum rate of release of the 19

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drill string. Ex. 1, ` Patent, Col. 7, Lines 26-48. 142 Each of the valves regulates the flow of air to the air motor based on the signal that each valve receives from its corresponding regulator, which is in turn based on the signal that each regulator receives from its corresponding sensor. Therefore, after calibration of a regulator to maintain a desired value (a set-point value) of the associated drilling parameter (see, e.g., Ex. 1, ` Patent, Col. 8, l. 52 ­Col. 10, l. 3), a regulator will control its associated valve so as to 142 modify the rate of release of the drill string to maintain the set-point value of the associated parameter. See, e.g., Ex. 1, ` Patent, Col. 8, ll. 16-31. 142 More specifically, each regulator includes a Bourdon tube (210, 250, 270, 290) that connects to the sensor associated with the regulator. In response to a change in the parameter that is measured by the sensor, the Bourdon tube drives a flapper (213, 251, 271, 291) that changes the amount of air flowing from an air nozzle (216, 254, 274, 294) of the regulator to the valve associated with the regulator. This output air flow from the nozzle is thus the output signal from the regulator to the associated valve. Based on this output signal, a piston (240, 241, 242, 243) of the valve moves up or down, thereby changing the amount of air from the air source that is allowed to flow through the valve to the air motor. See, e.g., Ex. 1, ` Patent, Col. 10, ll. 4142 32. In this manner, one or more of the measured drilling parameters may be maintained at or near a desired value determined to optimize the rate of penetration of the drill bit. In another embodiment of the ` Patent (Figure 14), the specification describes a 142 hydraulic coil tubing system. See Ex. 1, the ` Patent, Col. 21, l. 56 ­Col. 24, l. 26. This 142 alternative embodiment teaches the same concept of increasing and decreasing the rate of release (ROR) of the drill string in response to changes in drilling fluid pressure and/or weight on bit (WOB) through a different system that does not include a draw works, hoisting system, brake 20

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handle, etc. Further, this alternative embodiment teaches the use of electrical transducers for measuring drilling parameters including WOB and a hydraulic drill string control signal for controlling a controller versus a pneumatic signal as described above. C. THE PROSECUTION FILE HISTORY OF THE ` PATENT 142 A copy of the prosecution history of the ` Patent is attached to this brief as Exhibit 2. 142 Pertinent aspects of the prosecution history are summarized below. The application that ultimately issued as the ` Patent was filed on April 19, 1993 and 142 issued as a patent on December 12, 1995. The PTO examiner mailed a first office action on March 11, 1994. In this office action, the examiner objected to the specification under 35 U.S.C. § 112, ¶1 for failing to adequately teach how to make and use the claimed invention. Specifically, the examiner did not understand how the automatic driller could operate with more than one drilling parameter controlling the release of the drill string. All of the claims were rejected for the same reason. Furthermore, the examiner rejected all the claims under 35 U.S.C. § 103 as being unpatentable over U.S. Patent No. 4,662,608 to Ball (" Ball"Ex. 3), in view of U.S. Patent No. 4,165,789 to Rogers (" , Rogers" , Ex. 4), and further in view of portions of Petroleum Engineering: Drilling and Well Completion, by Carl Gatlin (" Gatlin"Ex. 5). The examiner also identified other prior art references that were , the result of the examiner'search in the office action'Notice of References Cited as follows: s s U.S. Patent No. 4,491,186 to Alder, Ex. 6; U.S. Patent No. 4,606,415 to Gray, Jr. et al., Ex. 7; U.S. Patent No. 4,639,868 to Tanakda et al., Ex. 8; U.S. Patent No. 4,793,421 to Jasinski, Ex. 9; and U.S. Patent No. 4,875,530 to Frink et al., Ex. 10. 21

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In response to this office action, the applicant provided arguments as to why the objections and rejections were improper and also added four new claims. The added claims were dependent claims drawn to a specific configuration of a regulator (and which issued unamended as Claims 5-8, respectively). The applicant responded to the objections and rejections by briefly describing how the invention works while using more than one parameter to control the release of the drill string, with the most restrictive parameter (e.g., the parameter that creates the signal that causes the brake handle to move the least) being the limiting parameter. The applicant also responded that, although the Ball Patent discloses a bit-weight-controlled drilling system, it does not disclose using any factor other than bit weight for controlling the release of the drill string. The applicant also argued that the other cited references failed to teach or suggest using any other parameter to control the rate of release of the drill string. Furthermore, the applicant argued that the Rogers Patent and the Gatlin Reference did not address the issue of controlling the release of a drill string and, as a result, their combination constituted impermissible hindsight. The PTO examiner mailed a second (final) office action on August 10, 1994 in which his previous objections and rejections were reiterated. Specifically, the examiner again objected to the specification as failing to meet the requirements of 35 U.S.C. § 112, ¶1, and again rejected the claims for failing to meet the requirements of 35 U.S.C. § 112, ¶1 and 35 U.S.C. § 103. The Section 112 claim rejections included both the previously rejected claims and the four claims added by the applicant in the previous response (the new claims were not rejected under section 103). The applicant filed a response to this second office action on November 7, 1994. In the response, the applicant amended Claims 3, 4, 8 and 9 of the application (these claims, as 22

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amended, correspond to issued Claims 3, 4, 12 and 13, respectively). Claims 3 and 4 of the application, which had been independent claims directed to an automatic drill string controller that controls the rate of release of a drill string based on drill string torque and drill string RPM, respectively, were amended to depend from Claim 1 of the application (which is Claim 1 of the issued patent). Claims 8 and 9 of the application, which were independent method claims directed to methods for regulating the release of the drill string based on drill string torque and drill string RPM, respectively, were amended to depend from Claim 7 of the application (which is Claim 11 of the issued patent). In accordance with the examiner'request during one or more telephone interviews with s the applicant and in order to overcome the Section 112 rejections, the applicant submitted a daily drilling record that evidenced a use of a commercial embodiment of the invention. The applicant argued that the daily drilling record illustrated that the described embodiment could operate using multiple drilling parameters to control the rate of release of the drill string and further argued why the invention as described was operable. With respect to the Section 103 rejections, the applicant also argued that none of the cited references taught the use of drilling fluid pressure as a parameter to control the rate of release of the drill string. The applicant emphasized that although the Gatlin Reference teaches that the hydraulic pressure of the drilling fluid affects the rate of penetration, it does not disclose or suggest that this pressure can be used as a parameter to automatically control the rate of release of the drill string. The applicant argued that all of the pending claims were allowable since they recite controlling the rate of release of a drill string using drilling fluid pressure (or depend from a claim that recites such a limitation). Based on the amendments and arguments made in applicant' November 7, 1994 s 23

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response, the examiner mailed a Notice of Allowance on March 9, 1995. The issue fee was timely paid, and the ` Patent issued on December 12, 1995. 142 After the commencement of this litigation, Defendant Pason filed an Ex Parte Reexamination Request of the ` Patent in view of U.S. Patent No. 3,223,183 to Varney 142 (" Varney"Ex. 11) on January 26, 2004. In its Ex Parte request Pason asserted that Claims 1 and , 11 of the ` Patent were invalid under (1) 35 U.S.C. § 102 as being anticipated and thus 142 unpatentable over the Varney Patent; and (2) 35 U.S.C. § 103 as being obvious and thus unpatentable over the Varney Patent in view of the other prior art cited during prosecution of the ` Patent. 142 On April 15, 2004 the PTO examiner granted Pason' Ex Parte request and ordered s reexamination of Claims 1 and 11 of the ` Patent. 142 The applicant filed a response to the examiner' order granting Pason' Ex Parte s s Reexamination Request on June 8, 2004. In response the applicant pointed out, among other things, that Varney failed to teach the regulation of the rate of release of the drill string as recited by the ` Patent'claims. 142 s On August 9, 2004, Pason filed a Reply to applicant'response whereby Pason asserted s that Claim 14 in addition to Claims 1 and 11 of the ` Patent were invalid under (1) 35 U.S.C. 142 § 102 as being anticipated and thus unpatentable over the Varney Patent; (2) 35 U.S.C. § 103 as being obvious and thus unpatentable over the Varney Patent in view of the other prior art cited during prosecution of the ` Patent; and (3) 35 U.S.C. § 112, ¶¶1 & 2 for failing to adequately 142 teach how to make and use the claimed invention and that the patent claims fail to particularly point out and distinctly claim the subject matter which the applicant regards as his invention. Based on arguments made in applicant' June 8, 2004 response, the examiner mailed a s 24

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Notice of Intent to Issue Ex Parte Reexamination Certificate on November 23, 2005. In the examiner'notice, the examiner confirmed the patentability of the ` Patent'claims as issued s 142 s on December 12, 1995. The examiner reasoned that " Varney does not teach or suggest effecting an ` increase in the rate of release' a ` and decrease in the rate of release' it pertains to Claims as 1-15 of the ` Patent. On July 4, 2006, the PTO issued an Ex Parte Reexamination Certificate 142 confirming the patentability of Claims 1-15 of the ` Patent. 142 IV. VARCO'S CLAIM CONSTRUCTION

Varco's Markman brief details its interpretation of the claim terms Pason contends are disputed. Unless otherwise indicated, Varco's interpretation of the claim terms is entitled to a full range of equivalents for the purpose of a determination of infringement under the doctrine of equivalents. Varco'interpretation is supported by the written description or specification of the s '142 Patent, including its Reexamination Certificate in combination with '142 Patent' s prosecution file history (Ex. 2) including the cited prior art (Ex. 3-11) as well as the following extrinsic evidence sources which support how the words and phrases of the claims would be understood by a person of ordinary skill in the relevant art: (1) A Dictionary for the Oil and Gas Industry, by the University of Texas at Austin Petroleum Extension Service (PETEX), 1st Ed. (2005), (hereinafter referred to as "PETEX", Ex. 13); Webster's New World Collegiate Dictionary, 4th Ed., MacMillan U.S.A. (1999) (herinafter referred to as "Webster's", Ex. 14); McGraw-Hill Dictionary of Scientific and Technical Terms, 6th Ed., McGraw-Hill (2003), (hereinafter referred to as " McGraw-Hill Scientific"Ex. 12); , Report of Varco's Technical Expert ­ Gregg Perkin (hereinafter referred to as "Perkin Report", Ex. 15); Reports of Pason'Techical Expert ­ Ford Brett (hereinafter referred to as s J. " Brett Reports"Exs. 16 & 17); , 25

(2)

(3)

(4)

(5)

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(6)

Testimony of Pason'Technical Expert ­J. Ford Brett (hereinafter referred to as s " Brett Testimony"Ex. 18) ,

These sources describe how a person having ordinary skill in the art of the ` Patent 142 would understand the terms of the asserted claims. Varco contends that this hypothetical person of ordinary skill would possess certain specialized technical skills and would have competent technical training and familiarity in the onshore and offshore oil and gas exploration industry including some relevant and personal experience with electro-mechanical control systems. See Ex. 12, Perkin Report at ¶¶17-19. Varco has provided certain tables within this brief comparing the parties' respective interpretations on certain claim terms which Pason has previously provided its proffered construction. For example, Pason has only disclosed its interpretation of the following claim terms: " regulator"" ; coupled"" ; relay"and " ; relaying." A. [1.] " drilling fluid pressure regulator" (Claim 1 of the ` Patent) a : 142 a drilling fluid (i.e., mud) pressure regulator, e.g., a device that is capable of detecting and responding to electrical, mechanical, hydraulic or pneumatic signal(s).

Varco'Interp.: s

1.

" Drilling Fluid Pressure"

Drilling fluid is a term of art in the drilling industry that refers to the fluid, often called mud, pumped down the drill string. The specification of the ` Patent describes drilling fluid, 142 the pressure of said fluid, and the function it performs in drilling a well as follows: " Pump 25 pumps drilling fluid (i.e., mud) into drill string 21 via drilling fluid line 88, where it travels down drill string 21 to mud motor 85 and drill bit 23. The drilling fluid drives mud motor 85, provides pressure within drill bit 23 to prevent blowouts, and caries drilled formation materials from borehole 86." Ex. 1, ` 142 Patent, Col. 4, ll. 10-15.

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Both " drilling fluid" and " pressure" are defined by the drilling industry PETEX dictionary as follows: PETEX (Ex. 13): " Drilling fluid ­circulating fluid, one function of which is to lift cuttings out of the wellbore and to the surface. It also serves to cool the bit and to counteract downhole formation pressure. Although a mixture of barite, clay, water and other chemical additives is the most common drilling fluid, wells can also be drilling using air, gas, water, or oil-based mud as the drilling mud. Also called circulating fluid, drilling mud." ; " Pressure ­ force that a fluid (liquid or gas) exerts uniformly in all directions the within a vessel, pipe, hole in the ground, and so forth, such as the force exerted against the inner wall of a tank or that exerted on the bottom of the wellbore by a fluid. Pressure is expressed in terms of force exerted per unit area, as pounds per square inch, or in kilopascals." Thus, drilling fluid pressure is the pressure or force (per unit area) exerted by the drilling fluid, e.g., the air, gas, water, or oil-based mud pumped down the drill string. 2. " Regulator"

The following table compares the party'respective interpretations of " s regulator." Varco'Construction s Pason'Construction s " device that is capable of detecting and " device used to control the flow of gases, liquid a a responding to electrical, mechanical, or electric current." hydraulic or pneumatic signal." See 9-4-06 Brett Report (Ex. 17), Page 2. See 7-21-06 Perkin Report (Ex. 15), Pages 10-11, ¶¶ 26-27.

As described in the Specification, the regulators " receive their respective signals to measure changes in those signals and produce an output signal representative of any changes." Ex. 1, ` Patent, Col. 2, ll. 4-6. One of the purposes of the " 142 signal representative of any changes" to identify a change in the related drilling parameter from a set-point value such that is 27

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rate of release may be controlled to bring the drilling parameter back to the set-point value. The regulator(s) output this signal representing a change in the associated drilling parameter to another device (a valve operating as a relay) which then supplies a control signal to a drill string controller in response to the output signal from the regulator (the drill string controller controls the rate of release of the drill string). Ex. 1, ` Patent, Col. 2, ll. 15-20. 142 The " regulator" element of Claim 1 of the ` Patent is described as performing specific 142 functions, namely measuring changes in drilling fluid pressure and outputting a signal representing those changes. Ex. 1, ` Patent, Col. 4, ll. 43-45. 142 Additionally, during the prosecution of the ` Patent the PTO Examiner7 concluded 142 that the " regulator" language of Claim