UNITED STATES PATENT AND TRADEMARK OFFICE...

UNITED STATES PATENT AND TRADEMARK OFFICE

____________

BEFORE THE PATENT TRIAL AND APPEAL BOARD

____________

ATLANTA GAS LIGHT COMPANY Petitioner

v.

BENNETT REGULATOR GUARDS, INC. Patent Owner

____________

Case IPR2013-00453

Patent 5,810,029

____________

REPLY IN SUPPORT OF PETITION

Filed: July 30, 2014

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TABLE OF CONTENTS

I. Introduction. ..................................................................................................... 1

II. The Level of Ordinary Skill in the Art. ........................................................... 2

III. The Bennett and Prahl Declarations Are Unreliable. ...................................... 4

IV. The Board Should Decline To Read Limitations Into The ‘029 Patent. ....................................................................................... 6

A. Internally Relieved Regulator. .............................................................. 6 B. Large Vent Tube. ................................................................................... 7 C. Minimum Gap Between Baffle And Side Wall Of Skirt. ..................... 7

V. Claims 1 and 5 Of The ‘029 Patent Are Anticipated By Peterson. ................. 8

VI. Claims 2-8 Are Obvious Over Peterson In View Of Prior Art InThe ‘029 Patent, Ferguson, and/or Ohmae Under 35 U.S.C. § 103(a). ............................................................................. 10

VII. Claims 1 and 4 Of The ‘029 Patent Are Anticipated By Ward. .................... 12

VIII. Claims 2-8 Are Obvious Over Ward In View Of Prior Art in ‘029 Patent, Ferguson, and/or Ohmae Under 35 U.S.C. § 103(a). ................ 15

IX. AGLC’s Petition Identified The Correct Real Party-In-Interest And Was Timely Submitted. ......................................................................... 15

A. MRC Global, Inc. and McJunkin Red Man Corp. .............................. 15 B. AGL Resources, Inc. and AGL Services Co. ...................................... 17

X. Conclusion. .................................................................................................... 20

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TABLE OF AUTHORITIES

Cases Page(s)

Bell & Howell Document Mgmt. Prod. Co. v. Altek Sys., 132 F.3d 701 (Fed. Cir. 1997) .............................................................................. 4

Broadcom Corp. v. Telefonaktiebolaget L. M. Ericsson, IPR2013-00601, Paper 23 ................................................................................... 16

CAE Screenplates Inc. v. Heinrich Fiedler GmbH & Co. KG, 224 F.3d 1308 (Fed. Cir. 2000) ............................................................................ 9

In re Donohue, 766 F.2d 531 (Fed. Cir. 1985) ................................................................ 10, 13, 15

Douglas Dynamics, LLC v. Buyers Prods. Co., 745 F. Supp. 2d 876 (W.D. Wis. 2010) ................................................................ 5

Macauto U.S.A. v. BOS GmbH & KG, IPR2012-00004, Paper No. 18 ............................................................................ 20

Motorola Mobility LLC v. Arnouse, IPR2013-00010, Paper 20 ................................................................................... 17

MPT, Inc. v. Marathon Labels, Inc., Case No. 1:04-cv-2357, 2006 U.S. Dist. LEXIS 38980 (N.D. Ohio Jun. 13, 2006) .................................................................................... 5

Nichia Corp. v. Emcore Corp, IPR2012-00005, Paper 68 ..................................................................................... 3

Nystrom v. Trex Co., 424 F.3d 1136 (Fed. Cir. 2005) ............................................................................ 5

Okajima v. Bourdeau, 261 F.3d 1350 (Fed. Cir. 2001) ............................................................................ 3

Synopsys, Inc. v. Mentor Graphics Corp., IPR2012-00042, Paper 60 ..................................................................................... 3

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Strickling v. Joe Behr Plumbing and Heating, Inc., Case No. 98CA104, 1999 Ohio App. LEXIS 4254 (Ohio App. Aug. 27, 1999) ................................................................................... 5

Statutes

35 U.S.C. § 103(a) ............................................................................................. 11, 15

35 U.S.C. § 315(e) ................................................................................................... 20

Other Authorities

37 CFR § 42.104 ........................................................................................................ 4

37 CFR § 42.106(b) ................................................................................................. 20

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LISTING OF EXHIBITS

Exhibit 1001: U.S. Patent No. 5,810,029





Exhibit 1006: Canadian Meter Company Quality Communiqué

Exhibit 1007: Patent Owner Proposed Claim Construction

Exhibit 1008: Prosecution History, Ex Parte Control No. 90/006,314

Exhibit 1009: Barnett Affidavit in Bennett Regulator Guards, Inc. v. Canadian Meter Company, Inc. et al., Case No. 1:04-cv-00177-JRA (N.D. Ohio)

Exhibit 1010: Royce Affidavit in Bennett Regulator Guards, Inc. v. Canadian Meter Company, Inc. et al., Case No. 1:04-cv-00177-JRA (N.D. Ohio)

Exhibit 1011: Waddell Affidavit in Bennett Regulator Guards, Inc. v. Canadian Meter Company, Inc. et al., Case No. 1:04-cv-00177-JRA (N.D. Ohio)

Exhibit 1012: Images of Accused Product in Bennett Regulatory Guards, Inc. v. McJunkin Red Man Corp. and Atlanta Gas Light Company, Civil Action 5:12-cv-1040 (N.D. Ohio)

Exhibit 1013: Plaintiff Infringement Contentions in Bennett Regulatory Guards, Inc. v. McJunkin Red Man Corp. and Atlanta Gas Light Company, Civil Action 5:12-cv-1040 (N.D. Ohio)

Exhibit 1014: U.S. Patent No. 5,810,029 (corrected)


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Exhibit 1019: Canadian Meter Company Quality Communiqué (corrected)

Exhibit 1020: Patent Owner Proposed Claim Construction (corrected)

Exhibit 1021: Prosecution History, Ex Parte Control No. 90/006,314 (corrected)

Exhibit 1022: Barnett Affidavit in Bennett Regulator Guards, Inc. v. Canadian Meter Company, Inc. et al., Case No. 1:04-cv-00177-JRA (N.D. Ohio) (corrected)

Exhibit 1023: Royce Affidavit in Bennett Regulator Guards, Inc. v. Canadian Meter Company, Inc. et al., Case No. 1:04-cv-00177-JRA (N.D. Ohio) (corrected)

Exhibit 1024: Waddell Affidavit in Bennett Regulator Guards, Inc. v. Canadian Meter Company, Inc. et al., Case No. 1:04-cv-00177-JRA (N.D. Ohio) (corrected)

Exhibit 1025: Images of Accused Product in Bennett Regulatory Guards, Inc. v. McJunkin Red Man Corp. and Atlanta Gas Light Company, Civil Action 5:12-cv-1040 (N.D. Ohio) (corrected)

Exhibit 1026: Plaintiff Infringement Contentions in Bennett Regulatory Guards, Inc. v. McJunkin Red Man Corp. and Atlanta Gas Light Company, Civil Action 5:12-cv-1040 (N.D. Ohio) (corrected)

Exhibit 1027: Declaration of Bob Schnorr

Exhibit 1028: Declaration of Brian K. Shore

Exhibit 1029: Order, D.I. 68, Bennett Regulator Guards, Inc. v. Atlanta Gas Light Company, et al., Northern District of Ohio Case No. 5:12-cv-1040 (Jul. 3, 2013)

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Exhibit 1030: Declaration of James Petersen

Exhibit 1031: Excerpts of the June 17, 2014 Dep. Tr. of Gregory Bennett

Exhibit 1032: Excerpts of the June 18, 2014 Dep. Tr. of Dr. Joseph Prahl

Exhibit 1033: U.S. Patent No. 417,135




Exhibit 1037: Aug. 30, 2012 Declaration of Barbara Christopher

Exhibit 1038: Notice of Service, D.I. 4, Bennett Regulator Guards, Inc. v. Atlanta Gas Light Company, et al., Northern District of Ohio Case No. 5:12-cv-1040 (Jul. 18, 2012)

Exhibit 1039: Plaintiff’s Motion for Leave to File First Amended Complaint, D.I. 18, Bennett Regulator Guards, Inc. v. Atlanta Gas Light Company, et al., Northern District of Ohio Case No. 5:12-cv-1040 (Nov. 6, 2012)

Exhibit 1040: Feb. 25, 2013 Declaration of Barbara Christopher

Exhibit 1041: Fisher Bulletin 71.1:S250


Exhibit 1043: U.S. Patent No. ELECTRAFIL® G-50/SS/5 Data Sheet


Exhibit 1045: 1941 RegO LP GAS Pocket Guide

Exhibit 1046: Rockwell Gas Regulator Handbook

Exhibit 1047: Itron B24 Regulator Description

Exhibit 1048: Excerpts of Swapan K. Bhattacharya, Metal-Filled Polymers (1986)

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Exhibit 2001: Protective Order, D.I. 39, Bennett Regulator Guards, Inc. v. Atlanta Gas Light Company, et al., Northern District of Ohio Case No. 5:12-cv-1040 (Dec. 12, 2012)

Exhibit 2002: Complaint, D.I. 1, Bennett Regulator Guards, Inc. v. Atlanta Gas Light Company, et al., Northern District of Ohio Case No. 5:12-cv-1040 (Apr. 26, 2012)

Exhibit 2003: Notice of Service, D.I. 3, Bennett Regulator Guards, Inc. v. Atlanta Gas Light Company, et al., Northern District of Ohio Case No. 5:12-cv-1040 (Apr. 27, 2012)

Exhibit 2004: First Amended Complaint, D.I. 24, Bennett Regulator Guards, Inc. v. Atlanta Gas Light Company, et al., Northern District of Ohio Case No. 5:12-cv-1040 (Nov. 21, 2012)

Exhibit 2005: Parties’ Joint Notice, D.I. 23, Bennett Regulator Guards, Inc. v. Atlanta Gas Light Company, et al., Northern District of Ohio Case No. 5:12-cv-1040 (Nov. 21, 2012)

Exhibit 2006: Order, D.I. 68, Bennett Regulator Guards, Inc. v. Atlanta Gas Light Company, et al., Northern District of Ohio Case No. 5:12-cv-1040 (Jul. 3, 2013)

Exhibit 2007: Yahoo! Finance Report on MRC Global Inc.

Exhibit 2008: Businessweek.com McJunkin Red Man Corp. Company Overview

Exhibit 2009: MRCglobal.com Corporate Biographies

Exhibit 2010: MRCglobal.com Company Overview

Exhibit 2011: LinkedIn Profile of Dedi Wilson

Exhibit 2012: Texas Secretary of State website McJunkin Red Man Corporation Inquiry

Exhibit 2013: McJunkin Red Man Corporation Registration Application

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Exhibit 2014: Defendant McJunkin Red Man Corporation Answer and Counterclaims to Plaintiff’s First Amended Complaint, D.I. 37, Bennett Regulator Guards, Inc. v. Atlanta Gas Light Company, et al., Northern District of Ohio Case No. 5:12-cv-1040 (Dec. 10, 2012)

Exhibit 2015: MRC August 1, 2013 Press Release

Exhibit 2016: Defendant McJunkin Red Man Corporation’s Motion to Dismiss, D.I. 14, Bennett Regulator Guards, Inc. v. Atlanta Gas Light Company, et al., Northern District of Ohio Case No. 5:12-cv-1040 (Aug. 31, 2012)

Exhibit 2017: Confidential Contract

Exhibit 2018: Confidential Agreement

Exhibit 2019: Patent Owner’s Amended First Discovery Requests to Petitioner

Exhibit 2020: E-mail exchange

Exhibit 2021: Aug. 1, 2012 letter from R. Issac to R. Schnorr

Exhibit 2022: E-mail








Exhibit 2030: Jul. 23, 2013 letter from R. Issac to R. Schnorr

Exhibit 2031: Aug. 5, 2013 letter from R. Schnorr to R. Issac

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Exhibit 2032: Oct. 13, 2013 letter from R. Issac to R. Schnorr

Exhibit 2033: Nov. 25, 2013 e-mail R. Schnorr to R. Issac

Exhibit 2034: Leadferret.com profile of Byrony Hodges

Exhibit 2035: aglresources.com About Us Other Officers

Exhibit 2036: Declaration of Joseph M. Prahl

Exhibit 2037: Declaration of Gregory Bennett

Exhibit 2038: Excerpts of the Oct. 23, 2012 Dep. Tr. of Barbara Christopher

Exhibit 2039: Jun. 16, 1995 Transmittal of Patent Application

Exhibit 2040: Correspondence

Exhibit 2041: Redaction Log

Exhibit 2042: LinkedIn Profile of Brian Hannon

Exhibit 2043: Uncertified Dep. Tr. of Bob Schnorr

Exhibit 2044: List of Deposition Exhibits

Exhibit 2045: LinkedIn Profile of Bob Schnorr

Exhibit 2046: Second Declaration of Barbara Christopher

Exhibit 2047: Selected AGLR Officer’s Bios

Exhibit 2048: Business Card of Bob Schnorr

Exhibit 2049: Service Mark Registration No. 3,786,639

Exhibit 2050: Service Mark Registration No. 3,218,549

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I. Introduction.

The Patent Owner’s Response (Paper 55 (“Resp.”)) follows the common

path of attempting to preserve patentability by reading new limitations into claims

that are unpatentably broad. These phantom limitations – an internally relieved

regulator, a large vent tube, and a minimum baffle-skirt gap for high mass flow of

gas – are not stated in the claims or supported by the specification of the ‘029

Patent. Rather, the Patent Owner relies on a declaration from a named inventor

hoping to profit from the ‘029 Patent and an expert whose analysis is unreliable on

its face. In contrast, the intrinsic evidence shows that these purported limitations –

which the Patent Owner touts as preserving patentability – simply do not exist.

The Patent Owner also relies on an overly narrow reading of the prior art.

For example, the Patent Owner argues that the devices disclosed in the Peterson

and Ward patents only allowed air to breathe and would not be capable of venting

gas. On the contrary, both patents make clear that they are used in connection with

breathing and venting a gas regulator. The Patent Owner also erroneously asserts

that internally relieved regulators were not known at the time of Peterson and

Ward. Again, the ‘029 Patent does not claim an internally relieved regulator, but

regardless, numerous internally relieved regulators pre-date Peterson and Ward.

Faced with weak support for patentability, the Patent Owner has instead

focused on various real party-in-interest and privity arguments. Even after

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multiple rounds of additional discovery, these arguments are still based on nothing

more than the Patent Owner’s conjecture and misunderstanding of AGLC’s

corporate structure. The simple facts remain that the Patent Owner sued AGLC

alleging infringement of the ‘029 Patent, AGLC timely filed its Petition, no entity

other than AGLC has funded or controlled AGLC’s role in the lawsuit or this IPR,

and AGLC has not funded or controlled any other entity in the lawsuit or this IPR.

The Patent Owner obscures these basic facts with a narrative cloud designed

to create the impression that third parties – such as AGLC’s parent holding

company or a sister company that provides support services – are the real parties-

in-interest. Not only is that factually incorrect, it is illogical that a holding

company or support services company would be the real parties-in-interest when

AGLC is the operating utility company that uses the accused devices and was sued

by the Patent Owner. The Board has already rejected similar arguments from the

Patent Owner in its institution decision and should do so again here.

Petitioner respectfully requests that the Board proceed to a final

determination that claims 1-8 of the ‘029 Patent are unpatentable over the prior art.

II. The Level of Ordinary Skill in the Art.

The Patent Owner’s argument that the Petition should be dismissed because

the Petitioner did not explicitly state the level of ordinary skill in the art has no

merit. “An invention may be held obvious without a specific finding of a

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particular level of skill where the prior art itself reflects an appropriate level [of

skill].” See Okajima v. Bourdeau, 261 F.3d 1350, 1355 (Fed. Cir. 2001); see also

In re Major, 2013 Pat. App. LEXIS 4370, 10-11 (Pat. App. 2013).1

Here, the level of ordinary skill in the art is reflected in the ‘029 Patent and

the cited prior art references and would be on the level of someone with a few

years of experience with designing, maintaining, or otherwise working with the

functional aspects of gas pressure regulators. (See Ex. 1030 at ¶ 6). Any

differences between the level of ordinary skill that is apparent from the prior art

and the level of skill identified by the Patent Owner (Resp. at 45) would not affect

the outcome in favor of patentability. If anything, the more stringent requirements

proposed by the Patent Owner make an obviousness result even more likely.

The Patent Owner’s related argument that the Petition is deficient because it

does not include an expert declaration is equally without merit. The basis for the

non-patentability of the ‘029 Patent is readily apparent from the prior art identified

in the Petition. Expert declarations are not required, and petitions are regularly

1 IPR2012-00005, Paper 68 and IPR2012-00042, Paper 60 (Resp. at 50-51)

do not require a petitioner to explicitly state a level of skill in the art. Rather, in

those decisions, the Board held that the patent owners had not sufficiently

addressed the prior art to meet the standard for a motion to amend.

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submitted without them. See, e.g., 37 CFR § 42.104. The Board found that the

Petitioner demonstrated a reasonable likelihood of prevailing on almost every

ground of unpatentability asserted in the Petition. (Paper 31 at 30-31). Any

factual disputes raised in Patent Owner’s Response are addressed by the

Declaration of James Petersen submitted herewith. (Ex. 1030). Petitioner has met

its burden to identify why the claims of the ‘029 Patent are unpatentable.

III. The Bennett and Prahl Declarations Are Unreliable.

The Patent Owner relies on the declarations of Mr. Gregory Bennett (Ex.

2037) and Dr. Joseph Prahl (Ex. 2036). Neither of these declarations is reliable.

Mr. Bennett is a named inventor on the ‘029 Patent and therefore his

testimony is given little weight. See Bell & Howell Document Mgmt. Prod. Co. v.

Altek Sys., 132 F.3d 701, 706 (Fed. Cir. 1997). Indeed, Mr. Bennett has

acknowledged that he has a financial interest in preserving the validity of the ‘029

Patent. (See Ex. 1031 at 12:25-13:8 (“Q. Do you stand to benefit financially based

on the outcome of this case? A. I would absolutely say yes.”).

Dr. Prahl opines on the mass flow of gas through vent skirts, but his

declaration is riddled with fatal errors. For example, Dr. Prahl purported to

calculate the mass flow for an embodiment disclosed in Peterson based on

dimensions he “measured” from the figures. (Ex. 1032 at 61:4-62:21). Dr. Prahl

acknowledges that the Peterson figures are not to scale. (Id. at 62:9-16). As such,

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his entire calculation is unreliable on that basis alone. See Nystrom v. Trex Co.,

424 F.3d 1136, 1149 (Fed. Cir. 2005) (“arguments based on drawings not

explicitly made to scale in issued patents are unavailing”).

Dr. Prahl also purported to compare the result he “measured” from the

Peterson figures with the mass flow of the device claimed in the ‘029 Patent. (Ex.

2036 ¶ 6). His declaration included no calculation for the ‘029 Patent, and at his

deposition, Dr. Prahl acknowledged that the comparison was to a purported

physical embodiment – not the ‘029 Patent. (Ex. 1032 at 137:3-139:12). And,

despite his conclusion focusing on the space between the baffle and skirt, the

device Dr. Prahl “measured” did not include a baffle. (Id. at 137:22-138:6).

These deficiencies unfortunately are not surprising as Dr. Prahl’s testimony

has been discounted in at least three previous proceedings. See, e.g., Douglas

Dynamics, LLC v. Buyers Prods. Co., 745 F. Supp. 2d 876, 882 (W.D. Wis. 2010)

(finding that Dr. Prahl offered “mere conclusory statements”); MPT, Inc. v.

Marathon Labels, Inc., Case No. 1:04-cv-2357, 2006 U.S. Dist. LEXIS 38980, at

*8 (N.D. Ohio Jun. 13, 2006) (striking testimony as inconsistent with the court’s

claim construction); Strickling v. Joe Behr Plumbing and Heating, Inc., Case No.

98CA104, 1999 Ohio App. LEXIS 4254, at *8-12 (Ohio App. Aug. 27, 1999)

(affirming finding that “Dr. Prahl’s opinions were not based upon a reliable

foundation”). The Board should likewise give his testimony no weight here.

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IV. The Board Should Decline To Read Limitations Into The ‘029 Patent.

Patent Owner attempts to distinguish the prior art through limitations that are

not stated in the claims. The Board should decline to read in these limitations.

A. Internally Relieved Regulator.

The Patent Owner’s Response includes an extensive discussion on internally

relieved and externally relieved gas pressure regulators. This discussion is not

supported by the claims or specification of the ‘029 Patent, however. Indeed,

despite a detailed recitation in the ‘029 Patent of the components found in a

“typical” gas pressure regulator, the ‘029 Patent includes no reference to internal

relief or internal relief mechanisms. (See Ex. 1014 at 3:1-4, 9-36).

The Patent Owner argues that the regulator profile shown in the figures of

the ‘029 Patent indicates internal relief. But, at his deposition, Mr. Bennett could

not identify any internal relief mechanism. (Ex. 1031 at 83:7-18 (“I got to admit

the drawing on Number 2 it’s not a fair drawing to actually show you that.”);

77:25-78:8; 79:18-80:3; 154:17-22). And, as Mr. Petersen explains, regulators

may have the same profile with or without internal relief. (Ex. 1030 ¶¶ 14-15).

Both types of regulators were in use at the time the application that led to the

‘029 Patent was filed and are still in use today. (Ex. 1031 at 33:19-23, 34:10-13;

Ex. 1030 ¶ 20]. As explained below, the claimed device serves the same function

– including venting gas – regardless of whether the regulator includes internal

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relief. (Ex. 1030 ¶ 16; infra at 10). Thus, it is not surprising that the ‘029 Patent

claims are not limited to internally relieved regulators.

B. Large Vent Tube.

The Patent Owner implies that the claim terms “outlet vent tube” and “outlet

vent means” are used in a particular manner in the ‘029 Patent. (Resp. at 34).

However, the Patent Owner fails to provide a proposed construction for these

terms, or dispute the construction adopted in the Board’s institution decision.

(Paper 31 at 19 (“should be given their ordinary meaning”)).

The Bennett Declaration states that the ‘029 Patent requires a “large” vent

tube. (Ex. 2037 at 7). To the extent that is Patent Owner’s proposed construction,

it is unsupported by the intrinsic record. Neither the claims nor the specification

describe a “large” vent tube. On the contrary, the ‘029 Patent states that “the

atmospheric pressure chamber is vented to atmosphere through a small opening.”

(See Ex. 1014 at 1:43-44 (emphasis added); 3:29-30 (“small vent opening”). At

their depositions, both Bennett and Prahl acknowledged that a “large” vent tube

limitation is not in the claims. (See Ex. 1031 at 73:4-74:2; Ex. 1032 at 46:14-24).

C. Minimum Gap Between Baffle And Side Wall Of Skirt.

The Patent Owner likewise implies that the claim term “baffle

means…being spaced from the interior wall of said skirt to permit gas flow

therearound” is used in a particular manner in the ‘029 Patent. (Resp. at 34). But

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the Patent Owner again fails to provide a proposed construction.

The Patent Owner makes various references to “substantial space” and “high

mass flow” being required. (Resp. at 15, 34, 46, 50, 52, 53). These phrases do not

appear in the claims. Both Mr. Bennett and Dr. Prahl have acknowledged that the

‘029 Patent claims do not require a specific baffle-skirt space. (Ex. 1031 at 76:22-

77:12 (“it just needs to be the proportionate size to allow gas flow around”); Ex.

1032 at 81:7-15 (“I have to agree that [the ‘029 Patent] doesn’t specify a specific

dimension”)). Dr. Prahl further acknowledged that the phrase “to permit gas flow

therearound” could mean a very small amount of gas. (Ex. 1032 at 53:13-54:7).

V. Claims 1 and 5 Of The ‘029 Patent Are Anticipated By Peterson.

The only “elements” of claims 1 and 5 that the Patent Owner contends are

not present in U.S. Pat. No. 2,620,087 (“Peterson”) are an internally relieved gas

regulator, a large outlet vent tube, and space between the baffle and interior wall of

the skirt to permit a high mass flow of gas. (Resp. at 34). As discussed above,

these limitations are not stated in claims 1 or 5. The Board should find no genuine

dispute that these claims are anticipated by Peterson on that basis alone.

It also is worth noting, however, that the Patent Owner relies on an overly

narrow reading of Peterson. For example, the Patent Owner argues that Peterson

“is used with an externally relieved regulator [that] performs only a breathing

function and not a venting function.” (Resp. at 46). On the contrary, Peterson is

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titled “Weatherproof Breather And Relief Vent For Gas Regulators.” (Ex. 1015

(emphasis added)). Peterson further references a “breather and relief vent”

throughout and includes claims directed to a “breather cap” and to a “breather and

vent cap.” (See, e.g., id. at 1:1-10; 2:47-50 (emphasis added); compare, e.g.,

claims 1, 3 and 7 with claims 5 and 8). See CAE Screenplates Inc. v. Heinrich

Fiedler GmbH & Co. KG, 224 F.3d 1308, 1317 (Fed. Cir. 2000) (different terms

are presumed to have different meanings).

Moreover, even if the ‘029 Patent claimed an internally relieved regulator (it

does not), the Patent Owner is wrong in its contention that internally relieved

regulators did not exist at the time of the Peterson patent. Internally relieved

regulators have been known since at least 1889. (Ex. 1030 ¶¶ 10-13; Ex. 1033).

Notably, C.D. Peterson, the named inventor on the ‘087 Patent, was prosecuting

another application at the same time as the ‘087 Patent titled “Gas Pressure

Regulator with Internal Relief Valve.” (See Ex. 1035). In that application Mr.

Peterson described various known functions for a vent and breather, including

venting gas through a “pressure relief valve in the diaphragm” and out of “the

single outlet also serving to vent the housing should the diaphragm leak.” (Id. at

6:33-37; see also Ex. 1036 at 3:20-34 (noting, in another Peterson patent, that gas

from a ruptured diaphragm may be vented through a vent “fitted with a bug-proof

vent protector of known construction”). In sum, these references show that a

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person of ordinary skill would have understood that the Peterson device would be

compatible with breathing and venting for internally and externally relieved

regulators. See In re Donohue, 766 F.2d 531, 533-534 (Fed. Cir. 1985) (additional

references can be used to interpret anticipating reference).

In addition, the Peterson device will “permit gas flow” as in claims 1 and 5

of the ‘029 Patent even if not used with an internally relieved regulator. Most all

regulators are designed to vent at least some gas out of the atmospheric pressure

chamber because gas can leak around the diaphragm into that chamber. (Ex. 1030

¶ 16; Ex. 1035 at 6:36-37). The Prahl Declaration fails to establish that the

Peterson device would not “permit gas flow” as claimed in the ‘029 Patent. Not

only is his analysis unreliable as discussed above, Dr. Prahl considered only one

embodiment of Peterson and ignored others with non-specific baffle-skirt spacing.

(See, e.g., Ex. 1015 at 1:46-51; 5:34- 6:2 (claiming “a continuous uniform

clearance”)). Indeed, at his deposition, Dr. Prahl acknowledged that the Peterson

device would be capable of venting gas. (Ex. 1032 at 81:21-82:1).

Claims 1 and 5 are unpatentable as anticipated by Peterson.

VI. Claims 2-8 Are Obvious Over Peterson In View Of Prior Art In The ‘029 Patent, Ferguson, and/or Ohmae Under 35 U.S.C. § 103(a).

Prior Art Described In ‘029 Patent. The Patent Owner does not dispute that

the features of a gas pressure regulator included in claims 5-8 were acknowledged

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to be part of the prior art in the ‘029 Patent itself. (Ex. 1014 at 1:13-50).

The Patent Owner makes a separate argument that the Peterson device would

not be used with an internally relieved regulator because “there would be no reason

to change the baffle-skirt gap.” (Resp. at 52). On the contrary, to the extent a

“change” in the gap would be required, the Patent Owner admits that “[o]ne skilled

in the art…would know that an internally relieved gas regulator would require

substantial spacing in order to permit a venting function to occur….” (Id. at 52;

see also Ex. 1032 at 69:17-71:21, 132:23-133:17 (agreeing that making gap larger

would be obvious); Ex. 1031 at 130:25-131:7 (same); Ex. 1030 ¶ 35 (same)).

Thus, at the very least, the baffle-skirt gap that the Patent Owner says is required in

claims 1 and 5 would have been obvious to a person of ordinary skill.

Increasing the gap would not destroy the intended function of the Peterson

device. The objects of the invention stated in Peterson included “prevent[ing]

closure by insects or sealing by moisture or freezing.” (Ex. 1015 at 1:6-15). Both

objects are not required for every embodiment. And in any event, Peterson also

teaches a screen to keep out insects. (Id. at 1:38-46; Ex. 1030 ¶ 35).

Ferguson. As to claims 2 and 6, the Patent Owner does not dispute that

Ferguson teaches a skirt member formed of a molded plastic material. (Resp. at

37-38). As to claims 4 and 8, the Patent Owner implies that the screen – which is

plainly shown in Ferguson (Ex. 1017 at 2:53-54; 3:41-46; 4:33-40; Fig. 6) – must

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extend to the very bottom of the skirt. (Resp. at 38). The ‘029 Patent does not

require this. Moreover, a screen just inside the lower end opening serves the same

function as a screen at the very bottom of the lower end opening. (Ex. 1030 ¶ 50).

Ohmae. The Patent Owner does not dispute that Ohmae discloses an

electrically conductive molded plastic material. (Resp. at 38).2

VII. Claims 1 and 4 Of The ‘029 Patent Are Anticipated By Ward.

Patent Owner misunderstands the grounds for unpatentability based on U.S.

Pat. No. 2,494,679 (“Ward”) and improperly limits the claims to one embodiment.

The ‘029 Patent includes an embodiment with a vent tube that faces

downward, but is not limited to that embodiment and the claims do not require it.

(Ex. 1014 at 4:30-40). A person of ordinary skill would understand that the

elements included in the claims could be arranged in various ways depending on

the orientation of the vent tube. (Ex. 1030 ¶ 43). Ward discloses each element of

claims 1 and 4 arranged in a manner allowed by the claims (and not flipped

“upside down” (Resp. at 35, 52)). This is illustrated by Peterson, which shows that

the same structural elements can apply to vent tubes oriented upward or downward.

(Compare, e.g., Ex. 1016 Figs. 1-3 with Figs. 4-5; 4:11-42 (“All of the important

2 Petitioner does not rely on Ferguson or Ohmae for other elements that the

Patent Owner argues these references “[do] not disclose.” (Resp. at 38-39).

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features which lead to the satisfactory operation of the first embodiment are

incorporated in this one, but it is made to operate from the top of a standpipe rather

than at the lower end of a nipple.”)); In re Donohue, 766 F.2d at 533-534.

Also, the Patent Owner’s argument that Ward does not disclose “an upper

end opening” misreads the claims as requiring the upper end opening to be a hole

in the skirt member. The claims do not require a hole or even state that the upper

end opening connects the vent tube to the skirt member. Rather, the upper end

opening is the area defined by the skirt member that connects the “vent tube to

[the] interior space.” (Ex. 1016 at 4:48-49; Ex. 1030 ¶ 44). The upper end is

plainly “open” in Ward (indicated in yellow below) – and not “closed” as Patent

Owner argues – because if it were closed, then gas would not be able to exit the

vent tube, which is key to the functionality of the device. (Ex. 1030 ¶ 44).

The Patent Owner relatedly argues that the baffle in Ward “is not positioned

to underlie an upper vent opening.” (Resp. at 47). But the claims do not require

the baffle to underlie an “upper vent opening.” Rather, the claims state that the

skirt

lower end

upper end

interior space defined by skirt

14

baffle must “underlie said upper end opening.” The baffle in Ward (indicated in

red) underlies the upper end opening. (Ex. 1030 ¶ 45).

Finally, Patent Owner argues that “Ward discloses a breather cap for an

externally relieved gas regulator (internally relieved regulators did not exist in

1948).” (Resp. at 35). As explained, the ‘029 Patent does not claim an internally

relieved regulator (which, regardless, was well known in 1948) or venting a

specific volume of gas. (See supra 6-8). Just as the ‘029 Patent claims a “baffle

means…spaced from the interior walls of said skirt,” Ward taught “the outer edge

of [the baffle] is spaced from the inner side of [the cap].” (Ex. 1016 at 3:7-8).

Moreover, the Patent Owner gives Ward an overly narrow reading. Ward is

titled “Vent Cap” and is directed to gas regulators “wherein, customarily, a vent or

stand pipe extends outdoors for connecting one side of a diaphragm chamber to the

atmosphere.” (Ex. 1016 at 1:6-10) (emphasis added). One of ordinary skill would

understand that a vent would only need to extend outdoors if it was venting gas.

(Ex. 1030 ¶ 38; see also Ex. 1036 at 3:28-34 (noting that vent pipes run outdoors to

vent gas “for obvious safety reasons”)). In re Donohue, 766 F.2d at 533-534.

Ward also states that it “is applicable as a safety fire, and clog-proof vent for all

sorts of receptacles containing inflammable fluids.” (Ex. 1016 at 1:34-41). These

references to fire safety features and inflammable fluids likewise indicate that the

“vent cap” in Ward was intended to vent gas and not just air. (Ex. 1030 ¶ 38).

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Claims 1 and 4 are unpatentable as anticipated by Ward.

VIII. Claims 2-8 Are Obvious Over Ward In View Of Prior Art in ‘029 Patent, Ferguson, and/or Ohmae Under 35 U.S.C. § 103(a).

Other than as addressed above, the Patent Owner does not address the prior

art in the ‘029 Patent, Ferguson, and/or Ohmae separately from Peterson in view of

these same references. Thus, for the reasons stated above, the Board should also

find the claims of the ‘029 Patent obvious over Ward in view of these references.

IX. AGLC’s Petition Identified The Correct Real Party-In-Interest And Was Timely Submitted.

AGLC is a utility company that constructs, operates, and maintains a natural

gas system infrastructure in Georgia. (Ex. 1037 ¶ 5). On July 18, 2012, Patent

Owner served AGLC with an Ohio lawsuit alleging infringement of the ‘029

Patent. (Ex. 1038). On July 3, 2013, the Ohio court dismissed AGLC on personal

jurisdiction. (Ex. 1029). AGLC filed its Petition on July 18, 2013. (Paper 2).

The Patent Owner’s privity and real party-in-interest allegations include an

alphabet soup of entities with any connection to AGLC. Nonetheless, the simple

facts remain that no entity other than AGLC has funded or controlled AGLC’s role

in the lawsuit or this IPR, and AGLC has not funded or controlled any other entity

in connection with the lawsuit or this IPR. (Ex. 1027).

A. MRC Global, Inc. and McJunkin Red Man Corp.

In its Response, the Patent Owner acknowledges – as AGLC has repeatedly

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stated – that neither MRC Global, Inc. (“MRCG”) nor McJunkin Red Man Corp.

(“MRMC”) has controlled Petitioner’s role in this IPR. (Resp. at 43). The Patent

Owner also fails to identify any evidence that MRCG or MRMC funded this IPR.

The Patent Owner’s only remaining Section 315(b) argument regarding

MRCG and MRMC stems from a “demand for indemnity” that Patent Owner says

was made by MRCG. (Resp. at 43-44). There is no indication that a “demand for

indemnity” creates a privity relationship. And, as the Patent Owner now implicitly

admits, no indemnification agreement actually existed. (See Resp. at 44

(theorizing that MRCG and MRMC “would have welcomed AGLR taking over

defense of the Ohio suit if the issues concerning indemnification could have been

resolved”) (emphasis added)). Thus, even if an indemnity agreement would be

sufficient to establish privity (and there is precedent to the contrary), there is no

such agreement here. Cf. Broadcom, IPR2013-00601, Paper 23 at 9.

In addition, the only entity that the Patent Owner served with a complaint

more than one year before AGLC filed its Petition was MRCG. The Patent Owner

cannot show privity between AGLC and MRCG for the additional reason that, as

the Patent Owner has acknowledged, “[MRCG] conducts no operations

and…MRMC is the operative party relative to facts and events alleged in the

complaint.” (Ex. 1039 at 2). At the time MRCG was served, MRMC would at

most have received notice of the complaint, but the key event under Section 315(b)

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is service. See Motorola Mobility, IPR2013-00010, Paper 20 at 2-6; (see also

Paper 27 at 14-19). There is no return of service showing that the Patent Owner

ever served MRMC. Thus, even if the Patent Owner could show privity between

AGLC and MRMC, there still would be no time bar.

B. AGL Resources, Inc. and AGL Services Co.

The Patent Owner recently expanded its search for a real party-in-interest

target to AGLC’s parent company – AGL Resources, Inc. (“AGLR”) – and a sister

company – AGL Services Co. (“AGLS”). The Patent Owner cannot argue that

AGLC’s Petition was time barred based on AGLR or AGLS because neither has

been served with a complaint. Instead, the Patent Owner argues that AGLR and

AGLS are the real parties-in-interest. This argument also lacks merit.

AGLR is a holding company that does not have employees and conducts

substantially all of its operations through its subsidiaries. (See Ex. 2043 at 51:24-

25, 59:11; Ex. 1039 ¶ 4). AGLR does not construct, operate, or maintain natural

gas system infrastructure. (Ex. 1039 ¶ 5). AGLR does not make, use, offer to sell,

or sell the device that the Patent Owner has accused of infringement. (Id. ¶ 6).

AGLR does not control the day-to-day activities of its subsidiaries and holds

separate corporate books and meetings. (Id. ¶¶ 7-9; Ex. 2043 at 148:12-149:7).

AGLS is a subsidiary of AGLR and a sister entity to AGLC. (See Paper 31

at 8). AGLS provides support services (e.g., legal, supply chain, facilities) to

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various subsidiaries of AGLR, such as AGLC.3 (Ex. 2043 at 38:15-25; 43:18-44:3;

125:24-126:2). Operating entities such as AGLC “dictate what they want and what

they need” in the form of support services from AGLS. (Id. at 92:13-22). Work

done by AGLS on behalf of an entity such as AGLC may get billed to the entity

receiving the service. (Id. at 93:5-22; 97:1-4). Likewise, the cost of materials –

such as the accused products in the litigation – is charged to the entity that uses the

materials. (Id. at 119:8-120:3). As a sister company, there is no indication that

AGLS could control AGLC’s operations.

The Patent Owner makes declarative statements throughout its Response and

Supplemental Response (Paper 61 (“Sup. Resp.”)) that, e.g., “the actual controlling

3 The Patent Owner devotes several pages in its Supplemental Response to

Mr. Schnorr’s job functions for AGLC. Mr. Schnorr serves as Vice President

Supply Chain and Fleet for AGLC, as well as other AGLR subsidiaries. (Ex. 2043

at 51:18-19; 56:9-14; 91:20-92:3). As part of the support services function, Mr.

Schnorr’s paycheck comes from AGLS. (Id. at 38:8-11). Contrary to the Patent

Owner (Sup. Resp. at 1), Mr. Schnorr has not “retracted” the description of his job

in his declaration. Rather, in the excerpt cited by Patent Owner, Mr. Schnorr states

that he is not a named officer of AGLC. (Id. at 79:8-13). This has no bearing on

the job description stated in his declaration, which is accurate. (Id. at 91:20-25).

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party in this matter is AGLR” (Resp. at 43) and “[t]he corporate parent and the

service company are real parties-in-interest because they directly controlled … the

filing and prosecution of the present IPR” (Sup. Resp. at 7). Such statements are

facially inconsistent with AGLC’s corporate structure and lack persuasive support.

For example, Patent Owner assumes that any mention of “AGL Resources”

is a reference specifically to AGLR. (Sup. Resp. at 2-3). That is not the case, as

Mr. Schnorr repeatedly made clear during his deposition. (Ex. 2043 at 59:1-60:3;

49:8-11; 50:25-51:3; 52:16-19; 66:19-24; 148:1-7). Similarly, the Patent Owner

relies on shorthand references to “AGL” made in correspondence and implies that

any imprecise use of “AGL” should have been corrected at the time. (Sup. Resp.

at 5). This impractical proposition ignores the reality that these communications

would have been focused on substance and not on precise corporate identification.

The Patent Owner also argues that AGLR and AGLS are real parties-in-

interest because they “have been involved in the IPR.” (Sup. Resp. at 4). But

AGLR or AGLS (which includes the legal department serving AGLC) having

“participated in discussions” and “received emails” does not make those entities

the real parties-in-interest. On the contrary, it is consistent with AGLC’s corporate

structure for AGLR and AGLS to be aware of this proceeding without controlling

or funding it because AGLC is the entity that uses and pays for the accused device.

Denying the Patent Owner’s real party-in-interest arguments would not

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unfairly allow “AGLR…two bites at the apple.” (Sup. Resp. at 7). This is the first

petition for IPR that has been filed on the ‘029 Patent. In the unlikely event of a

subsequent petition or further district court litigation, the Patent Owner would be

free to argue the estoppel provisions of 35 U.S.C. 315(e).

Finally, even if AGLR or AGLS were real parties-in-interest, the remedy is

not termination of the IPR. Rather, the Board could simply allow AGLC one

month to add other parties under 37 CFR § 42.106(b) and then proceed to a final

decision. There is no Section 315(b) bar under the facts here. AGLR and AGLS

have not been served with a complaint, and therefore the one year clock has not

started for these entities. Although AGLC was served more than one year ago, that

complaint was dismissed without prejudice. (Ex. 1029). A complaint dismissed

without prejudice is treated as though it had never been filed. See, e.g., Macauto

U.S.A. v. BOS GmbH & KG, IPR2012-00004 (Paper No. 18) at 15. Thus, the one

year clock for the Section 315(b) bar also has not started to run for AGLC, and any

additional real parties-in-interest (though there are none) could simply be added.

X. Conclusion.

For the reasons stated in its Petition and in this Reply, the Petitioner requests

that the Board cancel claims 1-8 of the ‘029 Patent as unpatentable.

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Respectfully submitted,

/Holmes J. Hawkins, III / Holmes J. Hawkins, III Registration No. 38,913 King & Spalding 1180 Peachtree St. NE Atlanta, GA 30309

Attorney for Petitioner Atlanta Gas Light Company

1

CERTIFICATE OF SERVICE

I hereby certify that on July 30, 2014 the foregoing REPLY IN SUPPORT

OF PETITION is being electronically transmitted to the Patent Trial and Appeal

Board via the Patent Review Processing System and is being served on counsel for

Patent Owner Bennett Regulator Guards, Inc. Wayne D. Porter, Jr.by email at

[email protected].

/Russell E. Blythe/ Russell E. Blythe Reg. No. 58,440

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