Transocean Offshore Deepwater Drilling, Inc. v. Maersk Drilling USA, Inc.
By Suzanne Van Arsdale – Edited by Sounghun Lee
Transocean Offshore Deepwater Drilling, Inc. v. Maersk Drilling USA, Inc., No. 2011-1555 (Fed. Cir. Nov. 15, 2012) (Transocean II)
The Court of Appeals for the Federal Circuit reversed the Southern District of Texas’s ruling that U.S. Patent Nos. 6,047,781, 6,085,851, and 6,068,069 held by plaintiff Transocean Offshore Deepwater Drilling, Inc. (“Transocean”) were invalid for obviousness and lack of enablement, that defendant Maersk Drilling USA, Inc. (“Maersk”) did not infringe some claims, and that Transocean was not entitled to damages. The court of appeals also reversed the district court’s conditional grant of a new trial.
The Federal Circuit held that a person of ordinary skill in the art could practice the claims without undue experimentation and objective evidence was sufficient to rebut a prima facie case of obviousness. As such, the court further held that the jury’s findings and award of $15 million to Transocean were sound, and the district court erred in granting Maersk’s motion for judgment as a matter of law for insufficient evidence. In so holding, the court noted that “we have rarely held that objective evidence is sufficient to overcome a prima facie case of obviousness.” Transocean II at 21.
Transocean’s patents, issued in 2000, claimed multi-activity derrick technology that allows a single derrick to perform parallel drilling operations with multiple tubular activity stations, thus reducing the amount of time required to complete a borehole. Transocean filed suit in 2007, claiming that the three patents were infringed by a rig that Maersk was building for Norway’s Statoil ASA.
The district court previously granted Maersk’s motion for summary judgment of obviousness and lack of enablement, concluding that the claims would have been obvious over the combination of prior art described in U.K. patent application GB 2,041,836 (Horn) and U.S. Patent No. 4,850,439 (Lund), and that the specification did not adequately describe claim limitations related to pipe transfer assembly. Transocean Offshore Deepwater Drilling, Inc. v. Maersk Contractors USA, Inc., 617 F.3d 1296, 1303, 1307–08 (Transocean I). In an opinion of August 18, 2010 (previously covered by the Digest), the Federal Circuit reversed the summary judgment of invalidity for obviousness because the district court failed to consider objective evidence, Id. at 1304, mentioned in Graham as secondary considerations. Graham v. John Deere Co. 383 U.S. 1 (1966). The court also reversed on enablement and remanded for resolution on whether a person of ordinary skill in the art could practice the claims without undue experimentation. Transocean I at 1305–07.
On remand, the jury found that the patent specification was enabling and also found the claims nonobvious after considering seven types of objective evidence: commercial success, industry praise, unexpected results, copying, industry skepticism, licensing, and long-felt but unresolved need. Id. at 10–11. The jury determined that Maersk infringed the patents and awarded $15 million in compensatory damages to Transocean. The district court granted Maersk’s motion for judgment as a matter of law, and Transocean appealed to reinstate the jury verdict.
This ruling reinforced the importance of secondary considerations in determining obviousness under 35 U.S.C. § 103, stating that such evidence may be “‘the most probative and cogent evidence in the record.’” Transocean II at 10 (quoting Stratoflex, Inc. v. Aeroquip Corp., 713 F.2d 1530, 1538 (Fed. Cir. 1983)). The court confirmed that all four Graham factors must be considered, as even if the first three — scope and content of prior art, differences between claimed invention and prior art, and level of ordinary skill in prior art — establish a prima facie case for obviousness, a party must be free to introduce evidence relevant to the fourth Graham factor, objective evidence of nonobviousness. Id. at 9–10.