Download - B. Administrative Patent Judges. Administrative Patent Judge ......2015/08/04  · Before CHUNG K. P AK, RICHARD M. LEBOVITZ, and JEFFREY B. ROBERTSON, Administrative Patent Judges.

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  • UNITED STATES PATENT AND TRADEMARK OFFICE

    BEFORE THE PATENT TRIAL AND APPEAL BOARD

    NALCO COMPANY Requester and Respondent

    v.

    BAKER HUGHES, INC. Patent Owner and Appellant

    Appeal2014-003628 Reexamination Control95/000,524 and 95/001,399

    Patent 7,497,943 B2 Teclmology Center 3900

    Before CHUNG K. P AK, RICHARD M. LEBOVITZ, and JEFFREY B. ROBERTSON, Administrative Patent Judges.

    LEBOVITZ, Administrative Patent Judge.

    DECISION ON APPEAL

    This is a decision on the appeal by the Patent Owner from the Patent

    Examiner's decision to reject pending claims 1, 5, 6, 17, 26, and 32 in the above-

    identified inter partes reexamination of US 7,497,943 B2. The Board's

    jurisdiction for this appeal is under 35 U.S.C. §§ 6(b ), 134, and 315. We affirm.

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  • Appeal2014-003628 Reexamination Control95/000,524 and 95/001,399 Patent 7,497,943 B2

    I. BACKGROUND

    The patent in dispute in this appeal is US 7,497,943 B2 ("the '943 patent")

    which issued March 3, 1999. The named inventors are Tran M. Nguyen, Lawrence

    N. Kremer, and Jerry J. Waters. The Patent Owner is Baker Hughes Inc. ("Patent

    Owner"). Appeal Brief("Appeal Br.") 4 (June 11, 2013).

    Requests for inter partes reexamination of the '943 patent were filed

    December 12,2009 and July 16,2010 under 35 U.S.C. §§ 311-318 and 37 C.P.R.

    §§ 1.902-1.997. Right of Appeal Notice ("RAN") 2 (March 11, 2013). The Third

    Party Requesters are Assateague Oil Inc. and Nalco Company, respectively. !d.

    The inter partes reexaminations were subsequently merged. !d. at 2-3.

    Patent Owner appeals the Examiner's decision to reject claims 1, 5, 6, 17,

    26, and 30-32. Appeal Br. 4. Nalco ("Requester") filed a Respondent Brief

    ("Resp't Br.") on July 11,2013 in response to Patent Owner's Appeal Brief.

    Assateague did not file a respondent brief.

    An oral hearing was held August 6, 2014 with both Patent Owner and

    Requester in attendance. A transcript of the hearing will be entered into the record

    in due course.

    Claim 1 is representative and reads as follows:

    A method of transferring metals and/or amines from a hydrocarbon phase to a water phase in a refinery desalting process consisting of:

    adding to a wash water, an effective amount of a composition to transfer metals and/or amines from a hydrocarbon phase to a water phase comprising at least one water-soluble hydroxyacid selected from the group consisting of glycolic acid, gluconic acid, CTC4 alpha-hydroxy acids, malic acid, lactic acid, poly-hydroxy carboxylic acids, thioglycolic acid, chloroacetic acid, polymeric forms of the above hydroxyacids, poly-glycolic esters, glycolate ethers, and ammonium salt and alkali metal salts of these hydroxyacids, and mixtures thereof,

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    lowering the pH of the wash water to 6 or below, before, during and! or after adding the composition;

    adding the wash water to crude oil to create an emulsion; and

    resolving the emulsion into hydrocarbon phase and an aqueous phase using electrostatic coalescence, where at least a portion of the metals and/or amines are transferred to the aqueous phase.

    Claim 26 is also an independent claim. Claims 5, 6, 17, and 30-32 are

    dependent claims.

    The claims stand rejected by the Examiner as follows:

    1. Claims 1, 5, 6, 17, 26, and 30-32 as obvious under 35 U.S.C. § 103(a) in

    view of Reynolds '463 1 and Hart.2

    2. Claim 1, 5, 6, 17, 26, and 30-32 as obvious under 35 U.S.C. § 103(a) in

    view ofReynolds'463 and SU '520.3

    3. Claims 1, 17, 26 and 32 as obvious under 35 U.S.C. § 103(a) in view

    Patent Owner Admissions, 4 and Hickok. 5

    4. Claims 1, 17,26 and 32 as obvious under 35 U.S.C. §103(a) in view of

    Reynolds'463 and Patent Owner Admissions.

    We AFFIRM Rejections 1 and 3 of all the rejected claims 1, 5, 6, 17, 26, and

    30-32. Because we have affirmed the rejections of all the claims which stand

    rejected, we do not reach Rejections 2 and 4.

    1 John Reynolds, US 4,789,463 issued December 6, 1988. 2 Rosalie B. Hart et al., US 5,078,858 issued January 7, 1992. 3 V.Kh. Shaimardanov et al., SU 1,666,520 Al August 8, 1989. 4 Testimony by Jerry Weers, Ph.D., in the Transcript from the Preliminary Injunction Hearing on September 1, 2009. Dr. Weers is one of the named inventors of the '943 patent and is an employee of the Patent Owner. Weers Decl. 1 (dated July 23, 2012). 5 J.E. Hickok et al., US 2,767,123 issued October 16, 1956.

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  • Appeal2014-003628 Reexamination Control 95/000,524 and 95/001,399 Patent 7,497,943 B2

    DESALTING CRUDE OIL

    The claims are drawn to a refinery desalting process for crude oil. In the

    "BACKGROUND OF THE INVENTION" of the '943 patent, it is stated that "the

    desalting of crude oil has been practiced for many years." '943 patent, col. 1, ll.

    21-22. The patent explains that "[ d]esalting is necessary prior to further processing

    [of crude oil] to remove [contaminant salts] and other inorganic materials that

    would otherwise cause fouling and deposits in downstream heat exchanger

    equipment and/or form corrosive salts detrimental to crude oil processing

    equipment." !d. at col. 1, ll. 38-42.

    During the hearing for a preliminary injunction, Dr. Jerry Weers, an inventor

    of the subject matter of the '943 patent, testified about the desalting process:

    A desalting process is the first step in the refinery process. Crude oil comes out of a storage tank, and the desalter is the first unit in the refinery that this crude oil sees.

    This oil comes to the units; it is heated; it is treated with various chemicals to help this process happen. Water is mixed in with the crude oil. It goes through then a mix valve, is the terminology. It's basically like a blender that creates an emulsion out of the oil and water so you get very good contact and very good removal of contaminants into the water phase. This mixture then goes into a big vessel where you have an electric grid.

    Weers Transcript 37:13-25.

    Q. What are the parts of the standard desalting process that everybody performs?

    A. Well, crude oil will come from the storage tanks in the refinery .... [After heating, it is] then blended with water from some source in the refinery. It goes through a mix valve; so, you make the emulsion out of the water and oil. It gives you a very good dispersion so you get good contact of the different materials. And then it goes into a vessel

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    that has the grids and the electric field as part of the technology that's used to separate again the water and oil once they've been mixed.

    Id. at 40: 1-16

    A. In every desalter that I've ever seen there's always a demulsifier; there's always heating going on; there's always a mix valve to create the oil/water emulsions that basically give you the good contact of the oil and water phases; there is always an electrostatic field in these, electric grid. The electricity and the electric field helps that water and oil break again.

    !d. at 70:16-22.

    Q. Now, adding an acid to the wash water was known prior to filing your patent, right?

    A. Adding different acids, yes. I mean, addition of an acid to change pH is a known process.

    !d. at 123:19-23.

    Thus, Dr. Weers acknowledged that the prior art desalting process involves

    mixing water with crude oil in a desalter to make an emulsion, and then resolving

    the emulsion into water and oil using an electrostatic grid.

    REJECTION 3. PATENT OWNER ADMISSIONS AND HICKOK

    With respect to claim 1, the Examiner found that the "only limitation

    missing from the Patent Owner Admissions [in the Weers Declaration] is the

    specific hydroxyl-carboxylic acid [the latter term is used by the Examiner

    interchangeably with "hydroxyacid," the term recited in the claims] required to

    chelate the metal ions in the crude oil." RAN 14. However, the Examiner found

    that "Hickok discloses the extraction of metal ions from gasoline (hydrocarbon

    phase) using a 5% to 1 0% by volume amount of a wash water containing a

    hydroxycarboxylic acid (glycolic acid, malic acid, or lactic acid at 2:64-72). See

    [Hickok], column 5, lines 38-42." !d.

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    The Examiner concluded that it would have been obvious to one of ordinary

    skill in the art "to have modified the teachings of Patent Owner Admissions by

    adding a water-soluble hydroxyacid such as lactic acid to the wash water at a pH of

    6 or below to the wash water as taught by Hickok in the standard crude oil

    desalting process as taught in the Patent Owner Admissions in order to improve the

    efficiency of transferring metal ions from crude oil into the wash water." !d. at 15.

    Patent Owner contends that Hickok is non-analogous prior art. Appeal Br.

    26. According to Patent Owner, Hickok concerns the treatment of gasoline, not

    "crude oil desalting [as claimed], and does not contain, much less discuss, concepts

    and terms used by Patent Owner Admissions such as 'desalter,' 'desalting,' 'crude

    oil,' 'emulsion,' 'electrostatic field' or 'wash water.'" !d. Patent Owner argues

    that the Examiner did not explain why the skilled worker looking at the Patent

    Owner Admissions would have been "motivated to look to Hickok to improve the

    desalting process." !d. Rather, Patent Owner contends that the Examiner

    improperly used hindsight in reaching the obviousness determination. !d.

    We do not agree that Hickok is non-analogous prior art. Prior art which is

    pertinent to the claimed invention is referred to as "analogous" prior art. It is well-

    established that there are two criteria to be applied when determining whether a

    reference is analogous prior art: (1) whether the reference is from the "same field

    of endeavor" as the claimed invention, and (2) if the reference is not within the

    same field of endeavor, "whether the reference is reasonably pertinent to the

    particular problem with which the inventor is involved." In re Clay, 966 F.2d 656,

    658-59 (Fed. Cir. 1992). "References are selected as being reasonably pertinent to

    the problem based on the judgment of a person having ordinary skill in the art." In

    re Kahn, 441 F.3d 977, 986-87 (Fed. Cir. 2006). When neither criterion is met

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    from the perspective of a person having ordinary skill in the art, the reference is

    deemed "non-analogous" and is not considered pertinent to the§ 103

    determination.

    In this case, the'943 patent is concerned with same problem as Hickok:

    removing iron and other metals from a hydrocarbon. Specifically, the '943 patent

    identifies iron as a contaminant which is to be removed by desalting.

    As mentioned, much of the solids encountered during crude oil desalting consists of iron, most commonly as particulate iron such as iron oxide, iron sulfide, etc.

    '943 patent, col. 2, 11. 21-23.

    In addition to complicating the desalter operation, iron and other metals are of particular concern to further downstream processing. This includes the coking operation since iron and other metals remaining in the processed hydrocarbon yields a lower grade of coke. Removing the metals from the crude oil early in the hydrocarbon processing stages is desired to eventually yield high quality coke as well as to limit corrosion and fouling processing problems.

    Id. at col. 2, 11. 28-36.

    Hickok's process also involves removing metals from a liquid hydrocarbon:

    The present invention is concerned with an improved process for producing stable gasoline. The invention is concerned with an operation wherein peroxides and other deleterious constituents present in a hydrocarbon mixture boiling in the motor fuel or gasoline boiling range are selectively removed by treating the hydrocarbon mixture with an acid. Among the deleterious constituents are small amounts of copper and iron introduced into the gasoline during ordinary refining processes.

    Hickok, col. 1, 11. 16-25.

    Because Hickok is concerned with the same problem as the inventors of the

    '943 patent, it is reasonably pertinent to the claimed subject matter and was

    properly cited by the Examiner as analogous prior art.

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    Patent Owner further distinguishes Hickok on several bases. First, Patent

    Owner states "there is no mention of an acid in the Patent Owner Admissions cited

    by the Examiner, so there can be no improvement of efficiency by using the

    Hickok acids-there is nothing to improve." !d. at 27. Second, Patent Owner states

    "there is no reasonable likelihood of success in transferring metal salts to the water

    phase because Hickok's motor fueVgasoline is fundamentally different from crude

    oil .... Because of this crucial difference, there is no reason to believe that the

    Hickok approach would work at all with crude oil .... " !d. Patent Owner

    contends that gasoline and crude oil are "vastly different in composition," and

    identify differences between the two. !d.

    As to the first argument, it is admitted in the background of the '943 patent

    that contamination with iron and other metals is problem during the desalting

    process. '943 patent, col. 2, 11. 7-36. Since Hickok teaches treating a hydrocarbon

    with a hydroxycarboxylic acid to remove iron, the skilled worker would have

    reasonably looked to Hickok to improve the efficiency of iron removal from a

    hydrocarbon during the desalting process. Hickok, col. 1, 11. 16-30.

    While gasoline may not be identical to crude oil, it is not disputed that both

    are liquid hydrocarbons. Patent Owner identifies differences between gasoline and

    crude oil, but does not provide sufficient evidence that such differences would

    have led one of ordinary skill in the art to reasonably expect that Hickok's acid

    would not work in a crude oil when both are hydrocarbon liquids. Indeed, it was

    well know that gasoline is derived from crude oil. Gary, 6 p. 49 (Table 4.2) and 54.

    ~James H. Gary et al., Petroleum Refining, Teclmology and Economics, 3d. Marcel Dekker, Inc., 1994.

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    Furthennore, in one of the examples in which Hickok employed lactic acid

    to treat gasoline, Hickok stated: "since other deleterious constituents were

    simultaneously removed by the lactic acid, which has an affinity for ions of copper

    or iron, the actual stability of the gasoline in normal storage was improved, as

    shown by the following example." Hickok, col. 5, 11. 1-8. Lactic acid is one of the

    claimed acids and is specifically recited in claim 1. '943 patent, original claim 1.

    In other words, deleterious constituents, such as iron and other metal ions, common

    to both liquid hydrocarbons, according to Hickok, can be extracted (desalted) via

    reaction with a hydroxycarboxylic acid, such as lactic acid, in a wash water as

    indicated supra. Thus, one of ordinary skill in the art would have had a reasonable

    expectation that the same deleterious metal ions in crude oil or gasoline would

    react to the acid taught by Hickok for the desalting purposes. On this record,

    Patent Owner has not provided an adequate explanation and/or evidence as to why

    the acid in Hickok would be expected to behave differently in the crude oil from

    which the gasoline is derived. Nor is there any objective evidence before us to

    doubt that chemistry in the crude oil hydrocarbon would be sufficiently different

    than the chemistry in the gasoline hydrocarbon such that lactic acid would

    completely lose its affinity for iron as taught by Hickok.

    In sum, Patent Owner did not provide sufficient evidence to rebut the

    Examiner's determination that Hickok's acid would have been expected to be

    effective in a conventional crude oil desalting process as claimed.

    Wash water additional and removal

    Patent Owner contends "the Nguyen '943 claims recite adding the

    composition to the wash water; Patent Owner Admissions do not recite that a water

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    soluble hydroxyacid, or any acid, is always added to wash water." Appeal Br. 24.

    Patent Owner further states "that while Dr. Weers acknowledged that adding acids

    to wash water was known, he did not admit that it was a known claim element.

    Nor did Dr. Weers state that the pH of the wash water should be lowered to 6 or

    below before, during, or after adding the composition." !d. at 26. Patent Owner

    also argued that there is "no teaching, disclosure or hint in Hickok that this

    aqueous solution water is removed from the gasoline so treated." Appeal Br. 28.

    These arguments are not persuasive.

    Hickok's acids are added to the fuel hydrocarbon in an aqueous solution.

    Hickok, col. 3, 11. 13-14. "The motor fuel is treated with about 0.1% to 10% by

    volume of the acid solution, preferably with from about 1 %to 5% by volume." !d.

    at col. 3, 11. 23-26. In a conventional desalting process, an aqueous solution- the

    wash water- is added to crude oil hydrocarbon. It would have been obvious,

    therefore, to have added the acid to the wash water in the conventional process

    since wash water is aqueous as is Hickok's acid solution. Addition of the acid

    would lower the pH, meeting the corresponding step of the claim.

    After treatment with the acid solution, Hickok teaches:

    The treated oil is withdrawn from zone 6 by means of line 9 and passed to an acid contacting zone 10 wherein the same is contacted with acid which is introduced by means of line 11 and removed by means of line 12. This acid treatment removes from the gasoline or motor fuel the objectionable copper and iron as well as the peroxides.

    Hickok, col. 2, 11. 45-51 (emphasis added).

    Line 12 is shown in Hickok's figure as removing "spent acid" from the

    "product." Thus, contrary to Patent Owner's argument, there is an express

    teaching in Hickok to remove the aqueous acid solution from the treated oil.

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    Patent Owner also argues that Hickok adds metal materials to the fuel, while

    the'943 patent is drawn to removing such metals. Appeal Br. 28. However,

    Hickok expressly teaches that it is not necessary to add metals:

    While the invention has been described specifically with respect to the deliberate addition of either iron or copper, and in the treatment of oil with an oxygen containing gas, it is to be understood that the motor fuel may have sufficient copper and iron dissolved therein. Under these conditions the feed oil is passed directly to zone 6 by means of lines 14 and 15.

    Hickok, col. 2, 11. 54-61. This step bypasses line 3 where the addition of the

    cooper and iron occurs. Id. at col. 2, 11. 30-33.

    REJECTION 1. REYNOLDS '463 AND HART

    The Examiner found that Reynolds '463 describes adding a hydroxyacid to

    wash water, lowering the pH, mixing the wash water with the crude oil, and then

    separating the wash water phase from the crude oil. RAN 6-7. The Examiner

    acknowledged that "Reynolds does not explicitly disclose the use of a mixing

    value to create an emulsion or an electrostatic dehydrator in a desalter to separate

    the aqueous phase from the crude oil phase." !d. at 7. However, the Examiner

    found that "Hart does disclose using a desalter that contains a mixing valve to

    create an emulsion of crude oil and wash water which is then resolved in a

    desalting apparatus by electrostatic coalescence." !d.

    The Examiner concluded that it would have been obvious to one of ordinary

    skill in the art "to modify the method of Reynolds by specifically using a mixing

    valve in a commercial desalter to form an emulsion between crude oil and wash

    water containing a hydroxycarboxylic acid (malic acid, lactic acid or citric acid) at

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    around pH 6, and then to resolve the emulsion by electrostatic coalescence as

    taught by Hart." !d.

    Emulsions

    Although Reynolds '463 did not expressly teach that an emulsion was made

    when its oil and water was shaken or mixed (Reynolds '463, col. 3, 1. 68 to col. 4,

    1. 1 ), the Examiner concluded that its description of intimate and thorough mixing

    of the oil with an aqueous phase indicated an emulsion was formed. RAN 23. The

    Examiner argued that this finding is "supported by the traditional definition of an

    emulsion: 'a mixture of two or more liquids that are immiscible' (Wikipedia)." Id.

    The Examiner stated that the "shaking of two immiscible liquids in a separatory

    funnel forms an emulsion just as surely as a mixing valve in a desalter creates an

    emulsion. The former emulsion is a temporary emulsion ... , while the latter

    intensive emulsion requires the resolving power of electrostatic coalescence." !d.

    Patent Owner argues the Examiner's finding is inconsistent with other

    disclosure in Reynolds '463 which teaches away from making emulsions (Resp't

    Br. 6-7): "[ o ]ne difficulty with the addition of base, however, is the formation of

    emulsions, which can interfere with effective separation. Therefore the most

    preferred pH is around 6, especially for naphthenic acid crudes." Reynolds '463,

    col. 3, ll. 33-37.

    Nonetheless, we need not resolve this issue because emulsions made of oil

    and aqueous solutions comprising acid are described by Hart. 7 RAN 31. As found

    7 We note that another Reynolds patent, US 4,853,109, which was cited by Hart as teaching adding acids in the form of aqueous solutions to oil, and then forming emulsions, has a substantially identical disclosure as Reynolds' 463. Hart, col. 1, 11. 48-56.

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    Appeal2014-003628 Reexamination Control 95/000,524 and 95/001,399 Patent 7,497,943 B2

    by the Examiner, Hart describes using a hydroxyacid (citric acid and oxalic acid)

    to remove iron from crude oil, and performs the process on an emulsion made of

    the crude oil and water, as recited in the claims. Hart, Abstract; col. 2, 11. 18-23,

    32-38, and 43-47; col. 6, 11. 62-68.

    Methods of extracting iron species, such as iron naphthenate, and iron sulfides, from a liquid hydrocarbon, such as crude oil are disclosed. A chelant selected from oxalic or citric acid is added directly to the liquid hydrocarbon and mixed therewith. Then, wash water is added to form a water in oil emulsion. The emulsion is resolved, with iron laden aqueous phase being separated.

    Hart, Abstract.

    Thus, a preponderance of the evidence supports the finding that hydroxyacid is

    capable complexing iron, and other metals, in both emulsions (Hart) and mixtures

    (Reynolds). Thus, even if Reynolds is found not to describe an emulsion, there is

    still the teaching by Hart that the claimed hydroxyacids reduce the amounts of

    metals when an emulsion step is carried out. The Examiner specifically cited

    Hart's teaching of a making an oil and water emulsion. RAN 7, 30-31, and 33.

    Although the Examiner relied upon Hart for teaching electrostatic grids to facilitate

    separation of an oil and water emulsion, the Examiner also found:

    Hart discloses the extraction of iron from crude oil using hydroxyacids as the chelating agents. Hart further discloses the addition of the hydroxyacid directly to the crude oil as wep as adding a wash water containing sajd hydroxyacid (6:58 to 7:40). Hart further discloses the resolution of an emulsion in a desalter using electrostatic coalescence (2:43-52; 6:58- 7:40).

    RAN 33.

    Furthennore, Hart clearly teaches the use of electrostatic coalescence to separate the crude oil phase from the aqueous phase (wash water) containing a hydroxyacid (citric acid) and the chelated metal ions (Abstract, 2:43-52; claims 1, 7 and 17).

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    RAN 41.

    Based on this disclosure, it does not appear that the Examiner ignored Hart's

    disclosure and used the '943 claims as a blueprint. See Appeal. Br. 20. Patent

    Owner's analysis appears to overlook the fact that the prior art in both

    Reynolds'463 and Hart teach that hydroxyacids are effective in removing metals

    from crude oil, and that this process works for both emulsions and non-emulsions.

    Wash water

    Patent Owner distinguishes the claimed subject matter from Reynolds '463

    on the basis that the claims comprise adding wash water to the crude oil, where

    Reynolds '463 describes adding an "aqueous solution." Appeal Br. 13. Patent

    Owner explains what the term "wash water" means, asserting that it is not "pure

    water" as used in Reynolds '463. !d. However, Patent Owner did not provide

    adequate evidence that Reynolds '463 's "aqueous solution" would be understood

    by one of ordinary skill in the art to mean only "pure water" or that it would

    exclude wash water from being used. Furthermore, as pointed out by the

    Examiner, Hart discloses utilized wash water in its emulsion. Hart, col. 6, 11. 62-

    68; RAN 33. For example Hart teaches:

    Methods of extracting iron species, such as iron naphthenate, and iron sulfides, from a liquid hydrocarbon, such as crude oil are disclosed. A chelant selected from oxalic or citric acid is added directly to the liquid hydrocarbon and mixed therewith. Then, wash water is added to form a water in oil emulsion. The emulsion is resolved, with iron laden aqueous phase being separated.

    Hart, Abstract.

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    Thus, it was reasonable for the Examiner to conclude that the aqueous

    solution taught by Reynolds '463, as further explained by Hart, includes wash

    water.

    Base

    Patent Owner argues that Reynolds '463 requires the addition of a base,

    while a base is excluded by the "consisting of' language in claim 1. Appeal Br.

    14. The factual evidence does not support a finding that Reynolds '463 requires a

    base. As argued by Respondent, claim 1 of Reynolds '463 recites "mixing said

    hydro carbonaceous feedstock with an aqueous solution of a metals sequestering

    agent comprising hydroxocarboxylic acids, salts thereof' and does not recite a step

    ·of adding a base. Resp't Br. 10. Reynolds '463 also describes using acid only,

    albeit at lower removal efficiencies. Reynolds '463, col. 5, 11. 8-9. "A known or

    obvious composition does not become patentable simply because it has been

    described as somewhat inferior to some other product for the same use." In re

    Gurley, 27 F.3d 551, 553 (Fed. Cir. 1994). Moreover, Hart's process, which uses

    the same hydroxyacids as in Reynolds '463, and overlaps in pH, does not teach

    adding a base to adjust pH.

    pH

    The claims recite "lowering the pH of the wash water to 6 or below."

    Patent Owner argues the pH ranges disclosed in Reynolds '463 and Hart are basic,

    while the claimed range is acidic at pH 6 or below. Appeal Br. 18. Hart teaches a

    pH of 6-11. Hart, col. 2, 11. 13-14. Reynolds '463 teaches a pH range about 2,

    preferably 5-9, and "the most preferred pH is around 6. Reynolds '463, col. 3, 11.

    31-37. Any of these pHs would therefore have been obvious to pick, including pH

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    6 as recited in the claims, a value which is disclosed by both Reynolds and Hart.

    Patent Owner's contention that Hart teaches a pH well above the claim range

    ignores the fact that Hart describes pH 6 as suitable, and that such pH is taught by

    Reynolds as preferred. Appeal Br. 19.

    With respect to the specifically claimed range, the "law is replete with cases

    in which the difference between the claimed invention and the prior art is some

    range or other variable within the claims .. .in such a situation, the applicant must

    show that the particular range is critical, generally by showing that the claimed

    range achieves unexpected results relative to the prior art range." In re Woodruff,

    919 F.2d 1575, 1578(Fed. Cir. 1990). Patent Owner has not provide adequate

    evidence that the claimed range produces unexpected results, rather than simply

    being routine optimization as taught by Reynolds '463 to achieve iron binding.

    Reynolds'463, col. 3, 11. 31-33 ("in order for the iron to bind appropriately to the

    citric acid, the pH should be above 2, and preferably 5 to 9.")

    Addition of acid to crude oil

    Hart adds the acid directly to the crude oil, in contrast to what is claimed and

    described in Reynolds '463. Based on this and other differences, Patent Owner

    contends the teachings in Reynolds '463 and Hart are conflicting and "that to

    combine the references would destroy them for their intended purpose since they

    are at odds with one another." Appeal Br. 19. Patent Owner contends that the

    Examiner is cherry picking the teachings, while ignoring other teachings in the

    publications. Id.

    Hart cited a different Reynolds patent (US 4,853,109) than the one cited in

    this reexamination which, like Reynolds '463, dissolves the acid in an aqueous

    solution and then adds it to the liquid hydrocarbon. Hart teaches:

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    - --- - -----------------------

    The present invention provides enhanced iron removal by the use of oxalic acid or by citric acid. In contrast to the Reynolds patent, the chelant is added directly to the liquid hydrocarbon instead of being added to the hydrocarbon in the form of an aqueous solution.

    Hart, col. 2, ll. 5-11.

    Hart teaches that an emulsion is formed:

    After the [oxalic acid or citric acid] chelant is added to and mixed with the liquid hydrocarbon, water is added to the resulting mixture ofhydrocarbon-chelant in an amount of about 1-15% water based on the weight of the liquid hydrocarbon. Preferably, water is added in an amount of about 5-10 wt.%. The w/o emulsion thus formed is resolved with iron laden aqueous phase being separated.

    !d. at col. 2, 11. 32-38.

    Thus, Hart considered itself an improvement over Reynolds prior art process

    in which the hydroxyacid is added to the aqueous solution and then combined with

    the crude oil. It is obvious to use a prior art process, even if such process was

    taught to be inferior. See Gurley, 27 F.3d at 553.

    Significantly, the hydroxyacid in each case- Reynolds, Hart, and the claims

    -is still being used for the same purpose, i.e., to form a complex with iron and

    other contaminants in the crude oil. The evidence indicates that the acid is

    effective in complexing with the iron in the crude oil whether the acid is 1)

    introduced into the crude oil by combining it with an aqueous solution (Reynolds

    '463) or 2) by direct addition (Hart). Either step works, and with only two choices,

    either alternative would have been obvious. 8

    8 We are aware that during the prosecution of the '943 patent a declaration by inventor Nguyen was filed in which Mr. Nguyen stated "where the glycol was added in the method made a significant difference in how much iron was removed." Nguyen Decl. 4 (February 7, 2007). Mr. Nguyen stated that when the glycolic acid was added to the wash water it was more effective then when added

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    Weers Declaration

    A declaration by Dr. Weers was provided by Patent Owner as objective

    evidence in support of non-obviousness. Dr. Weers testified that a commercial

    embodiment of the technology described and claimed in '943 patent is known as

    EXCALIBUR Technology. Weers Decl. 3.

    Dr. Weers testified: "Based on my personal knowledge, the EXCALIBUR

    Technology is an exact embodiment of claim 1 of the '943 patent, requiring the

    perfonnance of no additional steps not included in Claim 1 of the '943 patent."

    Weers Decl. at 5. While the Examiner required additional evidence to substantiate

    Dr. Weers's assertion (RAN 46), the Examiner did not provide sufficient reason to

    doubt it.

    Dr. Weers testified that the first full-scale trial of the claimed method to

    remove metals, including calcium, from crude oil was on May 10,2004. Weers

    Decl. 6. Dr. Weers testified that the '943 method was compared to a "competing

    method which uses polyacrylic acid." Id. at 7. The competing method, according

    to Dr. Weers, did not function for more than two days. !d. Dr. Weers further

    testified in his declaration that the technology was provided to "the Sunoco

    Refinery ... to process Doba crude oil using the Nguyen '943 Method Branded as

    the EXCALIBUR Technology." Id.

    Dr. Weers testified that Patent Owner "has developed approximately a 95+%

    market share in the United States, and worldwide, for both the processing of crude

    oil with high calcium concentrations and the processing of crude oil with high

    to the crude oil. !d. However, as discussed, Hart (in the background) discloses that Reynolds '463 teaches adding the acid in an aqueous solution as claimed.

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    amine concentrations through the use of the Nguyen '943 patent." Weers Decl. 7.

    Dr. Weers stated that that product was "very commercially successful" and would

    not have been possible without the Nguyen '943 patent as evidenced by the fact

    that no other competitor has been able to achieve any significant market share

    since the Nguyen '943 patent issued." Id.

    Legal principles

    "A nexus between commercial success and the claimed features is required.

    However, if the marketed product embodies the claimed features, and is

    coextensive with them, then a nexus is presumed and the burden shifts to the party

    asserting obviousness to present evidence to rebut the presumed nexus Brown &

    Williamson Tobacco Corp. v. Philip Morris Inc., 229 F.3d 1120, 1130 (Fed. Cir.

    2000) (internal citations omitted). "[T]he asserted commercial success of the

    product must be due to the merits of the claimed invention beyond what was

    readily available in the prior art." J.T. Eaton & Co. v. Atl. Paste & Glue Co., 106

    F.3d 1563, 1571 (Fed. Cir. 1997); see also Tokai Corp. v. Easton Enters., Inc., 632

    F.3d 1358, 1369 (Fed. Cir. 2011) ("If commercial success is due to an element in

    the prior art, no nexus exists."); Ormco Corp. v. Align Tech., Inc., 463 F.3d 1299,

    1312 (Fed. Cir. 2006) ("[I]f the feature that creates the commercial success was

    known in the prior art, the success is not pertinent.") "For objective evidence to be

    accorded substantial weight, its proponent must establish a nexus between the

    evidence and the merits of the claimed invention." In re GPAC, Inc., 57 F.3d

    1573, 1580 (Fed. Cir. 1995); see also Wyers v. Master Lock Co., 6UiJ.:.:_Jfl 1 2.3.L 1246 (Fed. Cir. 2010).

    Discussion

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    In this case, Dr. Weers testified that Baker Petrolite, the patent owner, has "a

    95+% market share in the United States, and worldwide, for both process of crude

    oil with high calcium concentrations and the processing of crude oil with high

    amine concentrations through the use ofNguyen '943 patent." Weers Decl. ~ 7.

    Accompanying Dr. Weers's declaration is a brochure titled "EXCALIBUR

    Contaminant Removal Technology." Exhibit 3. The brochure identifies

    contaminants such as "calcium naphthenates, inorganic iron, caustics, and other

    alkaline materials." Exhibit 3, p. 64. The EXCALIBUR technology is said to

    "involve[] injection of a water soluble complexing agent into the desalter wash

    water to increase the solubility of contaminants in the aqueous phase." !d. From

    the '943 patent, we understand the complexing agent to be a hydroxyacid. Patent

    Owner acknowledged this in the oral hearing. Hearing Transcript 23: 22-23. The

    brochure describes the efficiencies of the EXCALIBUR technology in removing

    calcium and iron from crude oils. !d. at 65.

    The brochure expressly characterizes the role of the "complexing agent" in

    the EXCALIBUR technology as removing the contaminants from the oil.

    However, this activity was known in the prior art.

    As explained above, Hickok teaches that "deleterious constituents were

    simultaneously removed by the lactic acid, which has an affinity for ions of copper

    or iron." Hickok, col. 5, 11. 4-7. Since the lactic acid is described as having "an

    affinity" for copper or iron, the skilled worker would have reasonably understood

    from this disclosure that lactic acid binds to the copper or iron, and thus forms a

    complex with it. The "spent acid" is removed (see Hickok's figure); the copper

    and iron are removed (Hickok, col. 2, 11. 48-50); hence, the copper and iron are

    clearly removed in the aqueous "spent acid" after having complexed with the lactic

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    Appeal2014-003628 Reexamination Control95/000,524 and 95/001,399 Patent 7,497,943 B2

    acid. Thus, it is appears from the discussion in the brochure describing the

    EXCALIBUR technology that the mechanism responsible for EXCALIBUR's

    efficacy in removing iron is described in Hickok.

    Reynolds '463 has similar teachings. Reynolds '463 expressly teaches that

    its acids, which are the same as those which are claimed, form complexes with iron

    and are effective for removing organo-calcium compositions. Reynolds'463, col.

    2, 11. 49-50; col. 3, 5-25. Reynolds'463 also teaches the complexes are soluble in

    the aqueous phase of the mixture.

    The iron is readily-bound or chelated to the acid ion. This iron/hydroxo-carboxylate complex is ionic and is therefore soluble in the aqueous phase of the mixture. The two phases, the aqueous and the crude or hydrocarbonaceous phase, are separated or permitted to separate, and the aqueous solution is removed. The aqueous solution containing the iron contaminant is removed, resulting in an essentially iron-free hydrocarbon feed

    Reynolds' 463, col. 2, 11. 49-57.

    The success of the claimed invention therefore appears not to be due to the

    merits of the claimed invention, but rather to the use ofthe hydroxycarboxylic

    acids described in Hickok and Reynolds. RAN 47. As the Examiner found, the

    addition of a hydroxyacid to a conventional desalting process constitutes the

    predictable use of a prior art element according to its established functions. KSR

    Int'l Co. v. Telejlex Inc., 550 U.S. 398, 413 (2007).

    In addition to this, Dr. Weers did not disclose the amount of acid used, the

    pH, and other conditions9 utilized in EXCALIBUR. Nor did Dr. Weers state that

    EXCALIBUR does not involve any additional steps which are not recited in the

    9 Patent Owner's own arguments directed to the Examiner's prima facie case of obviousness discussed supra indicates a significant effect of process conditions on the claimed desalting process.

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    claims on appeal. Consequently, it cannot be determined if it is the acid alone

    responsible for the asserted success. In other words, Patent Owner, the proponent

    of commercial success, fails to carry its burden of establishing a nexus between the

    evidence and the merits of the claimed invention.

    SUMMARY

    Based on the totality of the evidence, we conclude that it would have been

    obvious to one of ordinary skill in the art at the time of the invention to have made

    the subject matter of claim 1 in view of Reynolds and Hart (rejection 1 ), and Patent

    Owners Admissions and Hickok (rejection 3). Claims 5, 6, 17, 26, and 30-32 were

    not argued separately and thus fall with claim1 for the reasons given by the

    Examiner.

    TIME PERIOD FOR RESPONSE

    In accordance with 37 C.P.R.§ 41.79(a)(l), the "[p]arties to the appeal may file a request for rehearing of the decision within one month of the date of: ... [t]he original decision of the Board under§ 41.77(a)." A request for rehearing must be in compliance with 37 C.P.R.§ 41.79(b). Comments in opposition to the request and additional requests for rehearing must be in accordance with 37 C.P.R. § 41.79(c) & (d), respectively. Under 37 C.P.R.§ 41.79(e), the times for requesting rehearing under paragraph (a) of this section, for requesting further rehearing under paragraph (d) of this section, and for submitting comments under paragraph (c) of this section may not be extended.

    An appeal to the United States Court of Appeals for the Federal Circuit under 35 U.S.C. §§ 141-144 and 315 and 37 C.P.R. § 1.983 for an inter partes reexamination proceeding "commenced" on or after November 2, 2002 may not be taken "until all parties' rights to request rehearing have been exhausted, at which time the decision of the Board is final and appealable by any party to the appeal to the Board." 37 C.P.R.§ 41.81. See also MPEP § 2682 (8th ed., Rev. 7, July 2008).

    In the event neither party files a request for rehearing within the time provided in 37 C.P.R.§ 41.79, and this decision becomes final and appealable

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    under 37 C.P.R. § 41.81, a party seeking judicial review must timely serve notice on the Director of the United States Patent and Trademark Office. See 3 7 C.F .R. §§ 90.1 and 1.983.

    ack CC:

    AFFIRMED

    Patent Owner:

    MOSSMAN, KUMAR AND TYLER, PC P.O. BOX 421239 HOUSTON, TX 77242

    Third Party Requester:

    DAVIDSON , DAVIDSON & KAPPEL, LLC 485 7TH A VENUE 14TH FLOOR NEW YORK, NY 10018

    K&L GATES LLP P.O. BOX 1135 CHICAGO, IL 60690

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