WesternGeco Damages Case Before SCOTUS in Doubt After Fed Circuit Ruling

A recently-issued decision from the Court of Appeals for the Federal Circuit may have implications on a pending case before the U.S. Supreme Court.  That case, WesternGeco LLC v. ION Geophysical Corp.,[1] was issued May 7, 2018, and may affect how the Supreme Court rules in a related case involving the same parties and patents at-issue, the ruling of which is expected at any moment before the Court’s term ends in June.

That case, also entitled WesternGeco LLC v. ION Geophysical Corp.,[2] dealt with four patents owned by WesternGeco – U.S. Patent Nos. 7,080,607 (‘607), 7,162,967 (‘967), 7,293,520 (‘520), and 6,691,038 (‘038) – and to what extent do damages extend for infringement of U.S. patents when the component elements are made in the U.S. but assembled overseas into the patented device pursuant to 35 U.S.C. §271(f).  All of the patents are directed to technologies for controlling movement and positioning of streamers towed in an array behind a ship for geological measurement purposes.

This current case before the Fed Circuit was several appeals from IPRs initiated at the PTAB by ION against three of WesternGeco’s patents (excluding the ‘038 patent).  The Fed Circuit panel, composed of Judges Wallach, Chen, and Hughes, with Judge Chen writing for the court, affirmed the PTAB’s findings that the ‘607, ‘967, and ‘520 patents were unpatentable as anticipated or obvious.  Further, the panel affirmed the PTAB’s finding that the IPR proceedings were not time-barred under 35 U.S.C. §315(b).

The Fed Circuit case sets up a looming problem for the Justices on the Supreme Court: how will their impending decision on the patent damages will be affected by the Fed Circuit ruling finding the patents at-issue are now invalidated?  We will not delve into a full analysis of the Fed Circuit opinion since the ruling from SCOTUS, if any, may render it moot.

For now, there are a number of scenarios that could play out.  First, the Supreme Court can just issue its ruling regardless of the decision from the Fed Circuit.  After all, WesternGeco can always petition for en banc review and/or writ of certiorari before SCOTUS; these procedural processes need to be fully entertained before there is finality on the patentability of the WesternGeco patents.  Further, a decision on the damages need not necessarily be predicated on the patentability decision.  On the other hand, SCOTUS may just issue a per curiam order finding WesternGeco moot because of the patentability issue and may opt to wait until the full patentability process is played out before deciding the §271(f) damages issues.

We will continue to follow the developments and report back on the blog.

[1] ___F.3d___ (Fed. Cir. 2018), aff’g Petroleum Geo-Servs., Inc. v. WesternGeco LLC, Case Nos. IPR2015-00565, IPR2015-00566, and IPR2015-00567 (P.T.A.B. Mar. 17, 2016), Case Nos. IPR2014-01475, IPR2014-01477, IPR2014-01478 (P.T.A.B. Mar. 16, 2016), and Case Nos. IPR2014-00687, IPR2014-00688, and IPR2014-00689 (P.T.A.B. Dec. 15, 2015).

[2]See WesternGeco LLC v. ION Geophysical Corp., Case No. 4:09-cv-01827 (S.D. Tex. Jun. 19, 2013), aff’d-in-part, rev’d-in-part, and remanded, 791 F.3d 1340, 1344 (Fed. Cir. 2015), aff’d-in-part, rev’d-in-part, vacated-in-part and remanded,837 F.3d 1358, 1364 (Fed. Cir. 2016), cert. granted138 S. Ct. 734 (2018).