[00:00:00] Speaker 03:
20-1719, Sunoco Partners Marketing versus Magellan Midstream Partners.

[00:00:07] Speaker 03:
Mr. Kevil, welcome back.

[00:00:09] Speaker 03:
Please proceed.

[00:00:11] Speaker 01:
Thank you, Your Honor.

[00:00:13] Speaker 01:
In this IPR, the panel made a broad and unreasonable construction.

[00:00:20] Speaker 01:
It construed gasoline

[00:00:22] Speaker 01:
so that the claims encompass a different invention than the invention that is described and was prosecuted by the inventors in all of these patents.

[00:00:32] Speaker 01:
Starting with the 302 patent, it always talks about the invention being downstream at a tank farm or at a location downstream.

[00:00:44] Speaker 01:
And it talks about, such as Appendix 143, the benefits of the invention

[00:00:51] Speaker 01:
by blending downstream at the tank farm.

[00:00:55] Speaker 01:
And then when you move to the later 948 patents, it talks about in the background butane often being blended with other components at the refinery.

[00:01:05] Speaker 01:
And while it does mention gasoline at the refinery, it talks about for the first time, and I'm at appendix 110,

[00:01:12] Speaker 01:
Petroleum vendors and distributors are able to take optimum advantage of the many cost saving and performance enhancements that butane blending offers and to do so without regard to where the blending occurs along the pipeline.

[00:01:27] Speaker 01:
And that 111 appendix, it says the same thing, it may be practiced at any point on a pipeline downstream of a refinery.

[00:01:35] Speaker 01:
This whole invention was predicated upon the EPA regulations that came out in 1989 that now said you can at different locations meet different RVP levels so you have the ability to add butane.

[00:01:54] Speaker 01:
And what the inventors came up with was an automated way downstream of the refinery to add gasoline, to add butane to the gasoline

[00:02:04] Speaker 01:
to the maximum extent allowable, regardless of whether it's in the pipeline or at the tank farm.

[00:02:10] Speaker 01:
In any event, it's the same invention where what we're dealing with is gasoline, not the pre-gasoline components that are at the refinery.

[00:02:20] Speaker 03:
And that's where... Mr. Kevil, this is Judge Crost.

[00:02:23] Speaker 03:
Doesn't, as the specification described, the prior art is disclosing, quote, a system for automatically adjusting the amount of butane added to a gasoline stream at a petroleum refinery?

[00:02:37] Speaker 03:
And isn't that using gasoline to refer to gasoline at a refinery?

[00:02:45] Speaker 01:
Gasoline streams referred to there at the refinery are the component streams, and that's what you see if you look at the prior art.

[00:02:54] Speaker 01:
And that makes sense in the context of what they're talking about.

[00:02:57] Speaker 01:
So you have the refinery where you take these different components and you blend them together, along with butane being one of the components, and the output of the refinery is gasoline.

[00:03:09] Speaker 03:
And then that's what.

[00:03:11] Speaker 03:
But Mr. Kevill, it says this for more than one reference, right?

[00:03:16] Speaker 03:
It talks about another reference by saying it's, quote, a system for blending butane and gasoline at a petroleum refinery.

[00:03:24] Speaker 03:
That's at 948, column 2, lines 40 to 42.

[00:03:29] Speaker 01:
Yes.

[00:03:30] Speaker 01:
It says that, yeah, that's correct.

[00:03:32] Speaker 01:
It says that it discloses a system for blending butane and gasoline at a refinery.

[00:03:37] Speaker 01:
And what it talks about,

[00:03:38] Speaker 01:
is that it blends in the very next sentence a low-octane gasoline stream with a high-octane gasoline stream.

[00:03:45] Speaker 01:
So we're talking different components that go into the output of the refinery.

[00:03:52] Speaker 01:
The expert for the other side even admitted that all of the players in this industry understand that you're acting under EPA regulations, and so you would follow those.

[00:04:04] Speaker 01:
And one of the ways that the board erred in this

[00:04:08] Speaker 01:
was to say, yes, it's EPA-defined gasoline, and then ignored the fact that that same regulation says the things that are at the refinery are blend stock or gasoline components, they fall outside the gasoline definition.

[00:04:24] Speaker 01:
And then search through that one statement in the background, talking about Bejic, which, by the way, is owned by one of the licensees of Sunoco,

[00:04:36] Speaker 01:
And obviously that licensee didn't think Bayecek was applicable or didn't apply Bayecek downstream of the refinery.

[00:04:43] Speaker 01:
It instead agreed into a license with Sanoco.

[00:04:47] Speaker 01:
But the search to find some reference where I could say, okay, here's a point where gasoline is used in a way that I think can put it into refinery.

[00:05:01] Speaker 01:
conflicts with the entire invention.

[00:05:04] Speaker 01:
And it's not reasonable to say if the whole purpose of the invention is to blend in pipelines or blend at tank farms downstream where you have finished gasoline that is used as fuel, I can search to find one place or two places in the background where gasoline is mentioned at a refinery and then broaden the definition so that I incorporate the very refinery art

[00:05:30] Speaker 01:
that the background says is distinct and is not what the invention is.

[00:05:39] Speaker 01:
So on the gasoline the proper construction is refined petroleum that's used as fuel and then there's an express addition to that in the 302 where it says as used herein

[00:05:57] Speaker 01:
gasoline also includes diesel and jet fuel.

[00:05:59] Speaker 01:
So in any event, it's always the fuel.

[00:06:01] Speaker 01:
It's always the finished product.

[00:06:04] Speaker 01:
And that makes sense in the, in the context of the invention, that's all this invention was.

[00:06:08] Speaker 01:
And so where the board aired in the first point is to go and to try and find a way to broaden that, to encompass the very thing that the inventors were saying, here's the background and here's why we're different than what we're doing.

[00:06:25] Speaker 01:
The second place, unless the court has any questions, where the board erred is in gasoline and pre-blended gasoline.

[00:06:36] Speaker 01:
If you look at the 948 patent, it specifically says in the claims, specifically claim one, that it's a system for blending butane with gasoline in a pipe when the gasoline has a vapor pressure and

[00:06:53] Speaker 01:
then says down in claim three, the system of claim one wherein said processor receives the vapor pressure of a blend of gasoline and butane.

[00:07:03] Speaker 01:
So the claim language is very clear that in the first, you're talking about the gasoline, that would be the pre blend because otherwise claim three makes no sense where it says a blend of gasoline and butane.

[00:07:16] Speaker 03:
And so... Councillor, this is... Go ahead.

[00:07:23] Speaker 00:
I was going to say that your friend on the other side argues that your attempt to limit gasoline to pre-blended gasoline is incorrect because the intrinsic record, according to them, repeatedly refers to gasoline both pre- and post-blended streams.

[00:07:42] Speaker 01:
In every place, and I think we pointed this out in our brief, in every place where gasoline is used in either the specification or like here in the claims in particular, when it says the gasoline, it's referring back to before the blending.

[00:08:00] Speaker 01:
And often, or it's referring back to the blend, but it specifically refers to the blend.

[00:08:05] Speaker 01:
And that's what happens in these claims that were challenged where you say,

[00:08:10] Speaker 01:
you have a vapor pressure of the gasoline and then you say where you take the vapor pressure of a blend of gasoline and butane.

[00:08:19] Speaker 03:
But Mr. Kevil, this is Judge Prost.

[00:08:21] Speaker 03:
Isn't it still gasoline if you blend butane into it?

[00:08:26] Speaker 03:
Isn't that the ordinary meaning?

[00:08:28] Speaker 03:
Kind of like if you put cream in a cup of coffee, it's still a cup of coffee.

[00:08:34] Speaker 03:
And why is this a similar situation?

[00:08:37] Speaker 03:
Isn't your claim construction, which you relied on for the first gasoline argument, an admission that gasoline ordinarily includes the blends we use as fuel?

[00:08:48] Speaker 01:
Right.

[00:08:48] Speaker 01:
And that's why in these claims, what the inventors, what the patentee did in your analogy would say, I have a cup of coffee, and then I add cream to the coffee,

[00:09:01] Speaker 01:
And in one, I take the temperature of the coffee and in the other, I take the temperature of the blend of cream and coffee.

[00:09:07] Speaker 01:
It's still the coffee in both cases.

[00:09:09] Speaker 01:
I don't dispute that.

[00:09:11] Speaker 01:
But in this claim language, the patentee made clear what is being measured, right?

[00:09:25] Speaker 01:
The third point

[00:09:27] Speaker 01:
on the vapor pressure is the vapor pressure was by all testimony, by all the experts, everyone understands the vapor pressure and the vapor liquid ratio are different measurements.

[00:09:45] Speaker 01:
And based on that, everyone understood that these patents and these claims give you two different ways to measure the vapor pressure.

[00:09:55] Speaker 01:
There is an ambiguity created by a mistake in the wording where the patentee should have said volatility means in terms of these patents and instead said vapor pressure means.

[00:10:09] Speaker 01:
And that simple misunderstanding of one word or a mistake in one word is what caused all this, but it's very clear that

[00:10:21] Speaker 01:
the patentee means throughout.

[00:10:23] Speaker 01:
And if you look at the claims, it's very clear that the claims say... Well, Mr. Cavill, this is Judge Proce.

[00:10:28] Speaker 03:
Just on that point, it may be that the 302 specification uses the term vapor pressure to refer to more general category volatility, which can be measured by a vapor-liquid ratio.

[00:10:41] Speaker 03:
But the specification tells us what it's doing.

[00:10:45] Speaker 03:
And that's the point of lexicography, defining something to mean something different than its ordinary meaning.

[00:10:52] Speaker 03:
So how do you get around that in terms of complying with the public notice function?

[00:11:00] Speaker 01:
The language is clear lexicography, I agree, but it's lexicography where everyone that has read this has understood what was intended.

[00:11:10] Speaker 01:
What was intended was to say, you can look at volatility in different ways.

[00:11:15] Speaker 01:
You can look at it as the vapor pressure, or you can look at it as the vapor-liquid ratio.

[00:11:22] Speaker 03:
Let me just ask you.

[00:11:23] Speaker 03:
You made a statement like everyone who has read this.

[00:11:26] Speaker 03:
How do we know that?

[00:11:28] Speaker 03:
How do you ever?

[00:11:29] Speaker 03:
And that's a pretty high hurdle.

[00:11:30] Speaker 03:
I wouldn't expect for you to have to prove that.

[00:11:33] Speaker 03:
But how would you support that?

[00:11:36] Speaker 03:
Everyone who has read this reads it this way?

[00:11:41] Speaker 01:
You have 14 licensees that are sophisticated companies and no one has ever raised this issue that says the prior art reads on this because you've interpreted, you know, you've defined vapor pressure to mean something other than vapor pressure to also include vapor-liquid ratio.

[00:12:01] Speaker 01:
And I think the point is a person of skill in the art, right, is deemed to read

[00:12:08] Speaker 01:
in terms of the patent as a whole.

[00:12:11] Speaker 01:
And then the patent as a whole, it's clear what you're talking about.

[00:12:16] Speaker 01:
There's also, we cite in our page 53 of our principal brief, the testimony of two experts who made clear their understanding of this issue was that it was talking about two separate measurements.

[00:12:32] Speaker 01:
And even the board found that they're different measurements.

[00:12:35] Speaker 01:
So, you know, even the board recognized

[00:12:39] Speaker 01:
Okay, I understand they're different measurements, but the opposing council agreed they're different measurements.

[00:12:48] Speaker 01:
So, read in the context of the entire specification and the invention, it's clear that you're talking about different measurements.

[00:12:58] Speaker 03:
If my colleagues have nothing further, I think I heard the bell getting into your rebuttal.

[00:13:04] Speaker 03:
Anything from my colleagues further?

[00:13:06] Speaker 03:
If not, why don't we hear from Ms.

[00:13:09] Speaker 03:
Fiorella and we'll keep your rebuttal time.

[00:13:13] Speaker 00:
I'm fine.

[00:13:18] Speaker 03:
Okay.

[00:13:19] Speaker 03:
Ms.

[00:13:19] Speaker 03:
Fiorella.

[00:13:22] Speaker 02:
Good morning, Your Honor.

[00:13:23] Speaker 02:
May I please support Natika Fiorella on behalf of the Appellee Magellan and Powder Springs Logistics.

[00:13:29] Speaker 02:
Your Honor, I'd like to just jump right into the main claim construction issue here, which is on the term gasoline.

[00:13:36] Speaker 02:
Now, the board correctly found that the 548 and 9-plate patents use this term broadly, without restriction on location.

[00:13:45] Speaker 02:
And in doing so, the board properly rejected two different attempts by Sunoco to kind of narrow the scope of the claim term.

[00:13:54] Speaker 02:
First, it rejected Sunoco's attempt to draw this arbitrary line

[00:13:58] Speaker 02:
between gasoline inside a refinery and gasoline outside a refinery.

[00:14:03] Speaker 02:
And it did that by properly recognizing that the patent repeatedly described both as just gasoline.

[00:14:12] Speaker 02:
So in the colloquy Your Honor had with my friend on the other side, we talked a little bit about these prior art references that talk about blending butane with gasoline in a refinery.

[00:14:25] Speaker 02:
And I believe what Mr. Keppel said was, well,

[00:14:27] Speaker 02:
What they meant, what the patentee meant when they said that was gasoline components.

[00:14:33] Speaker 02:
But that supports the board's construction, because what term did the patentee choose to use when describing gasoline components?

[00:14:41] Speaker 02:
The patentee used the word gasoline.

[00:14:43] Speaker 02:
And that's the same word that's in the claim.

[00:14:46] Speaker 02:
So therefore, it suggests that the claim term gasoline is broad enough to encompass both.

[00:14:53] Speaker 02:
Just to preview the second issue, the second

[00:14:56] Speaker 02:
ways that Sonoco is trying to limit the scope of gasoline is by saying, actually, not even all gasoline downstream of the refinery is gasoline.

[00:15:09] Speaker 02:
Instead, Sonoco wants to exclude from the term gasoline the gasoline that is actually used as fuel, the one that's blended.

[00:15:18] Speaker 02:
As the board properly recognized, that is not supported by the intrinsic record either.

[00:15:25] Speaker 02:
When we look at the claims, we see that there is no limitation in the 9.8 or 5.8 claims to downstream of the refinery.

[00:15:33] Speaker 02:
And what Sanoco is trying to do is pack that limitation into the word gasoline.

[00:15:38] Speaker 02:
We already talked about why that's not appropriate, and we go through in our brief the many places in the spec that describe gasoline as both.

[00:15:47] Speaker 02:
Ms.

[00:15:48] Speaker 03:
Fiorella, this is Judge Prost.

[00:15:49] Speaker 03:
Let me just go going back to the pre blend gas issue.

[00:15:53] Speaker 03:
On the claim construction, the claim language of claims one and seven seems to use gasoline and blend to refer to different substances.

[00:16:06] Speaker 03:
So why should we conclude that gasoline can also include blend?

[00:16:13] Speaker 02:
So, Your Honor, what I'd say is that the claims describe gasoline, and they describe a blend of gasoline, and we agree they have different scopes.

[00:16:21] Speaker 02:
But that doesn't mean they have mutually exclusive scope.

[00:16:25] Speaker 02:
Gasoline is broad enough to encompass both blended gasoline and pre-blended gasoline.

[00:16:31] Speaker 02:
And simply what the claims are describing in the preamble is to say, here's a method for adding butane into gasoline to form more gasoline that also has butane.

[00:16:42] Speaker 02:
Nothing in that language suggests that the gasoline you're blending butane in can't already have butane.

[00:16:47] Speaker 02:
And in fact, the specification in the industry

[00:16:50] Speaker 02:
all tell us that the gasoline that comes into these systems often already has B-tank.

[00:16:56] Speaker 02:
And the board looked at these claims and said, okay, well, these aren't telling us enough about how we could possibly limit gasoline to only pre-blended, so it looks at the specification.

[00:17:09] Speaker 02:
And in the specification, again, the word gasoline is used broadly.

[00:17:13] Speaker 02:
It is not used as just the pre-blended gasoline.

[00:17:18] Speaker 02:
It encompasses both.

[00:17:19] Speaker 02:
And we see that in multiple places.

[00:17:21] Speaker 02:
I think the example at Appendix 114 is particularly helpful because it describes, and this is Column 12, Line 64, going into Column 13, Line 1, it describes taking vapor pressure measurements of the gasoline both upstream of the blending unit and downstream of the blending unit.

[00:17:47] Speaker 02:
And it also talks about blending.

[00:17:49] Speaker 02:
So earlier in that same paragraph, it says you want to actually add the butane to the gasoline.

[00:17:55] Speaker 02:
Now, there would be no point in taking measurements upstream and downstream of the blending unit if you're not adding any butane, because they'd be the same.

[00:18:04] Speaker 02:
So what the board properly recognized is that the patentee chose to use the word gasoline to describe both pre-blended and post-blended and use that to inform what the claims need.

[00:18:20] Speaker 02:
If I could, I'd like to go back to the main gasoline refinery-based argument just for a minute and discuss this idea that the inventions are limited to downstream of the refinery based on the 302 specification.

[00:18:38] Speaker 02:
And the point I want to make there is simply that this issue is with respect to the 948 and 548 patents.

[00:18:48] Speaker 02:
are continuations in part from the 302 patent.

[00:18:52] Speaker 02:
So they are different.

[00:18:53] Speaker 02:
They removed the language, the locational language that Mr. Kevil referred to about downstream of a refinery, at a tank farm, at a rack.

[00:19:05] Speaker 02:
They removed all those limitations to try and claim something broader.

[00:19:09] Speaker 02:
And that's what the 948 and 548 did.

[00:19:11] Speaker 02:
And in doing so, read directly on the refinery art.

[00:19:16] Speaker 02:
I believe Mr. Kevil also said,

[00:19:18] Speaker 02:
that the 948 and 548 patents distinguished refinery blending.

[00:19:24] Speaker 02:
Well, if we look at what they actually distinguished, it wasn't that Bajek and Mayer, these refinery blending operations, were done in a refinery.

[00:19:34] Speaker 02:
What they distinguished is how that blending was done.

[00:19:37] Speaker 02:
So that also does not show that this entire invention was related to downstream of a refinery.

[00:19:42] Speaker 02:
Not the claims, not the intrinsic record, not the extrinsic record, none of that shows

[00:19:52] Speaker 02:
I'd just like to touch very, very briefly on vapor pressure.

[00:19:56] Speaker 02:
We think that this is a pretty straightforward issue.

[00:19:59] Speaker 02:
And it sounds like Mr. Kevil agrees that there is lexicography here.

[00:20:04] Speaker 02:
So that ends the inquiry.

[00:20:07] Speaker 02:
The patentee chose the word they wanted to use and expressly told the public, when I say vapor pressure, I mean all of these things.

[00:20:16] Speaker 02:
And on his point that anyone who reads this, would it view it that way?

[00:20:20] Speaker 02:
Well, we certainly do.

[00:20:22] Speaker 02:
And the licensees that Mr. Kebbell referred to, there's plenty of reasons why people might enter into a license agreement.

[00:20:29] Speaker 02:
But certainly, we have seen no evidence that they looked at this issue, decided to do a deep dive into claim construction, and came out and said, no, I still want a license.

[00:20:38] Speaker 02:
So we disagree with that characterization.

[00:20:43] Speaker 02:
I would be happy to rest on my brief at this point, unless there are further questions from the court that I can answer.

[00:20:52] Speaker 03:
Thank you.

[00:20:53] Speaker 03:
Hearing none, we'll turn back to Mr. Kevil for a rebuttal.

[00:20:58] Speaker 03:
Thank you.

[00:21:00] Speaker 01:
Thank you, Your Honor.

[00:21:01] Speaker 01:
Your Honor, in essence, this is a CIMED case.

[00:21:04] Speaker 01:
The invention was always described clearly as downstream of refinery, whether they used the words tank farm or in a pipeline, refinery blending is what the invention is not.

[00:21:17] Speaker 01:
And my friend on the other side just said, that's not how

[00:21:22] Speaker 01:
They distinguished Bajac.

[00:21:23] Speaker 01:
Well, that's exactly what they said in distinguishing Bajac.

[00:21:26] Speaker 01:
At Appendix 1470, the patentee said, however, the technology disclosed in Bajac is limited to blending gasoline streams as part of the refining process.

[00:21:40] Speaker 01:
The various gasoline streams the refiner works with are part of the refining process and are not the end product that is distributed to retailers.

[00:21:50] Speaker 01:
And then at 1471, it says, in contrast to the raw components at the refinery, the tank farm distributes finished gasoline ready for consumption.

[00:22:02] Speaker 01:
So throughout the specifications, the prosecution history, and all of the arguments, it's always been very clear what the invention is not.

[00:22:13] Speaker 01:
The invention is not refinery blending.

[00:22:17] Speaker 01:
And that's where the board

[00:22:19] Speaker 01:
made the clear error in trying to find a snippet from the background, or I could say gasoline, can be interpreted broadly to include refinery when the invention was always, we are not the refinery.

[00:22:36] Speaker 01:
And US Venture also just said, well, there's no evidence that anybody took a deep dive into these patents.

[00:22:45] Speaker 01:
That evidence is that 3048

[00:22:49] Speaker 01:
where Chevron, who is the owner of the Bayject patent, actually put in a declaration that's cited here saying that they looked at the patents and decided to use Sunoco for their blending based in part on the strength of their patents.

[00:23:07] Speaker 01:
So there was a deep dive done.

[00:23:09] Speaker 01:
These are sophisticated companies that own this refinery art that have looked at it.

[00:23:15] Speaker 01:
There's record evidence that none of these refineries ever adapted any of these systems to be used downstream of a refinery.

[00:23:26] Speaker 01:
So it's hard to imagine.

[00:23:29] Speaker 03:
One quick point, Mr. Kevil, just to confirm because I don't think I mentioned it today.

[00:23:34] Speaker 03:
The board was still appropriately using the BRI standard in this case, right?

[00:23:40] Speaker 01:
That is correct.

[00:23:41] Speaker 01:
But the key in that is the R part of the BRI standard.

[00:23:45] Speaker 01:
And it has to be reasonable.

[00:23:47] Speaker 01:
And in view of an invention that is consistently described in ways downstream, it's unreasonable to say, let me find a way to include it upstream in the refinery.

[00:24:00] Speaker 01:
And one other point I want to make on the rejections on obviousness, this court couldn't affirm obviousness without a remand

[00:24:11] Speaker 01:
on the secondary considerations because the board misappropriately applied FOX in a way that just said, well, there's more than one patent on this issue without any looking into whether it is essentially the same invention, which it would be, because in every essence, what we're talking about is an invention that's automated butane and gasoline blending downstream of a refinery, whether it's in a pipeline or at a tank farm.

[00:24:41] Speaker 01:
So that was one other point I would make.

[00:24:45] Speaker 03:
OK.

[00:24:46] Speaker 03:
Hearing nothing more from my colleagues, we thank both sides, and the case is submitted.

[00:24:53] Speaker 01:
Thank you, Your Honor.

[00:24:54] Speaker 03:
Thank you.