Nabors Drilling Technologies USA, Inc.

Patent Trials and Appeals Board

Dec 9, 2021

IPR2021-01018 (P.T.A.B. Dec. 9, 2021)

Trials@uspto.gov Paper 11
571-272-7822 Date: December 9, 2021

UNITED STATES PATENT AND TRADEMARK OFFICE
______________________________

BEFORE THE PATENT TRIAL AND APPEAL BOARD
______________________________

HELMERICH & PAYNE INTERNATIONAL DRILLING COMPANY,
HELMERICH & PAYNE TECHNOLOGIES, LLC, and MOTIVE
DRILLING TECHNOLOGIES, INC.,
Petitioner,

v.

NABORS DRILLING TECHNOLOGIES USA, INC.,
Patent Owner.
______________________________

IPR2021-01018
Patent 7,802,634 B2
______________________________

Before KEN B. BARRETT, MATTHEW S. MEYERS, and
SEAN P. O’HANLON, Administrative Patent Judges.

O’HANLON, Administrative Patent Judge.

DECISION
Denying Institution of Inter Partes Review
35 U.S.C. § 314

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I. INTRODUCTION
A. Background
Helmerich & Payne International Drilling Company, Helmerich &
Payne Technologies, LLC, filed a Petition for inter partes review of
claims 1–12 (“the challenged claims”) of U.S. Patent No. 7,802,634 B2
(Ex. 1001, “the ’634 patent”). Paper 2 (“Pet.”), 1. Nabors Drilling
Technologies USA, Inc. (“Patent Owner”) filed a Preliminary Response.
Paper 7 (“Prelim. Resp.”). With our authorization (see Paper 8), Petitioner
filed a Preliminary Reply to the Preliminary Response (Paper 9) and Patent
Owner filed a Preliminary Sur-reply to the Preliminary Reply (Paper 10,
“Prelim. Sur-reply”).
Institution of an inter partes review is authorized by statute only when
“the information presented in the petition . . . and any response . . . shows
that there is a reasonable likelihood that the petitioner would prevail with
respect to at least 1 of the claims challenged in the petition.” 35 U.S.C.
§ 314(a) (2018). We have authority, acting on the designation of the
Director, to determine whether to institute an inter partes review under
35 U.S.C. § 314 and 37 C.F.R. § 42.4(a). For the reasons set forth below,
upon considering the Parties’ briefs and evidence of record, we conclude
that the information presented in the Petition fails to establish a reasonable
likelihood that Petitioner would prevail in showing the unpatentability of
any of the challenged claims. Accordingly, we decline to institute inter
partes review.
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B. Real Parties in Interest
Petitioner identifies its three constituent entities and Helmerich &
Payne, Inc. as sole real parties in interest. Pet. 1. Petitioner asserts that
Helmerich & Payne International Drilling Company and Helmerich & Payne
Technologies, LLC are subsidiaries of and wholly owned by Helmerich &
Payne, Inc. Id.
Patent Owner identifies itself and Nabors Corporate Services, Inc. as
real parties in interest. Paper 5, 2.
C. Related Matters
The parties indicate that the ’634 patent is the subject of the following
district court proceeding:
Nabors Drilling Technologies USA Inc. v. Helmerich & Payne
International Drilling Co., No. 3-20-cv-03126 (N.D. Tex. filed
October 14, 2020) (“the Texas litigation”).
Pet. 2; Paper 5, 2. Patent Owner further asserts that one patent, US
8,528,663 B2 (“the ’663 patent”), is related to the ’634 patent. Paper 5, 2.
We note that the ’663 patent is the subject of a petition for inter partes
review filed by Petitioner in IPR2021-01044.
D. The Challenged Patent
The ’634 patent relates to underground wellbore drilling. Ex. 1001,
1:14–16. There are two modes of drilling: rotary drilling, in which the drill
bit is rotated by a rotary drive means at the surface with a quill connecting
and transferring torque between the rotary drive means and the drill string,
and slide drilling, in which the drill string is not rotated and the drill bit is
rotated exclusively by a drilling motor mounted in the drill string proximate
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the drill bit. Id. at 1:16–22, 1:38–40. Drilling operations can include
vertical drilling, in which trajectory of the drill string is inclined at less than
about 10° relative to vertical, horizontal drilling, in which the drill string
trajectory is inclined about 90° from vertical, and directional drilling, in
which the trajectory of the drill string is being deliberately controlled to
maintain the wellbore on a planned course. Id. at 1:23–33. “Directional
drilling requires real-time knowledge of the angular orientation of a fixed
reference point on the circumference of the drill string in relation to a
reference point on the wellbore.” Id. at 2:3–6. “Obtaining, monitoring, and
adjusting the drilling direction conventionally requires that the human
operator must manually scribe a line or somehow otherwise mark the drill
string at the surface to monitor its orientation relative to the down-hole tool
orientation.” Id. at 2:29–33. “Consequently, the relationship between
toolface and the quill position can only be estimated by the human operator.”
Id. at 2:35–37.
The ’634 patent purports to improve upon known drilling systems by
“visibly demonstrating a relationship between toolface orientation and quill
position.” Ex. 1001, 2:46–48. Human-machine interface (“HMI”) 100 is
presented to the operator during drilling operations to allow the operator to
monitor the bottom hole assembly in three-dimensional space. Id.
at 5:67–6:3, 6:29–31. Figure 1 illustrates the HMI and is reproduced below.
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Figure 1 is a schematic view of HMI 100. Id. at 5:22–23. The HMI includes
“a dial or target shape having a plurality of concentric nested rings 105.” Id.
at 6:62–64. The rings display current data measurements and a history of
recent prior measurements with each ring representing a data measurement
iteration. Id. at 7:13–25. The most recent data measurements are depicted
closest to the edge of the dial, and older measurements step toward the
middle of the dial. Id. at 8:37–41. A variety of symbols are positioned on
the rings. Id. at 6:64–7:7. Circular symbols 110 represent magnetic-based
toolface orientation data, rectangular symbols 115 represent gravity-based
toolface orientation data, and triangular symbols 120 represent quill position.
Id. The HMI also includes indicators to display data from a variety of
sensors, including toolface mode indicator 130, toolface orientation
indicator 135, inclination indicator 140, and azimuth indicator 145. Id.
at 7:34–8:35.
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E. The Challenged Claims
Petitioner challenges claims 1–12 of the ’634 patent. Pet. 1. Claim 1
is the sole independent challenged claim and is reproduced below.
1. A method of visibly demonstrating a relationship
between toolface orientation and quill position, such method
comprising:
operating a drilling apparatus comprising a bit with a
steerable motor with toolface and a top drive;
steering the steerable motor and bit with the top drive;
receiving electronic data on a recurring basis, wherein the
electronic data includes quill position data and at least one of
gravity-based toolface orientation data and magnetic-based
toolface orientation data; and
displaying the electronic data on a user-viewable display
in a historical format depicting data resulting from a most
recent measurement and a plurality of immediately prior
measurements.
F. Asserted Grounds of Unpatentability
The Petition relies on the following prior art references:
Name Reference Exhibit
Haci US 7,810,584 B2, issued October 12, 2010 1006
Jones US 7,152,696 B2, issued December 26, 2006 1007
Maidla Step Change in Directional Drilling Control
and Efficiency When Using Motor Steerable
System, U.S. Dept. of Energy, June 2006
1008
Leder New Real-Time Anticollision Alarm Improves
Drilling Safety, 1995 SPE Annual Technical
Conference and Exhibition 507–15, October
22–25, 1995
1009
Cobern US 4,761,889 issued August 9, 1988 1010
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Petitioner asserts the following grounds of unpatentability:
Claim(s) Challenged 35 U.S.C. § Reference(s)
1, 4–7, 9, 10, 12 103(a)1 Haci, Cobern, Jones
2–3 103(a) Haci, Cobern, Jones, Leder
8, 11 103(a) Haci, Cobern, Jones, Maidla
Pet. 10. Petitioner submits a declaration of Robert Schaaf (Ex. 1005,
“Schaaf Declaration”) in support of its contentions.
II. ANALYSIS
A. Principles of Law
Petitioner bears the burden of persuasion to prove unpatentability, by
a preponderance of the evidence, of the claims challenged in the Petition.
35 U.S.C. § 316(e). This burden never shifts to Patent Owner. Dynamic
Drinkware, LLC v. Nat’l Graphics, Inc., 800 F.3d 1375, 1378 (Fed. Cir.
2015). The Board may authorize an inter partes review if we determine that
the information presented in the Petition and Patent Owner’s Preliminary
Response shows that there is a reasonable likelihood that Petitioner would
prevail with respect to at least one of the claims challenged in the Petition.
35 U.S.C. § 314(a).
A patent claim is unpatentable under 35 U.S.C. § 103(a) if the
differences between the claimed subject matter and the prior art are such that
the subject matter, as a whole, would have been obvious at the time the

1 The application resulting in the ’634 patent was filed prior to the date when
the Leahy-Smith America Invents Act (“AIA”), Pub. L. No. 112–29, 125
Stat. 284 (2011), took effect. Thus, we refer to the pre-AIA version of
section 103.
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invention was made to a person having ordinary skill in the art to which the
subject matter pertains. KSR Int’l Co. v. Teleflex Inc., 550 U.S. 398, 406
(2007). The question of obviousness is resolved on the basis of underlying
factual determinations including (1) the scope and content of the prior art,
(2) any differences between the claimed subject matter and the prior art,
(3) the level of skill in the art, and (4) when in evidence, any objective
evidence of nonobviousness.2 Graham v. John Deere Co., 383 U.S. 1,
17–18 (1966).
B. Level of Ordinary Skill in the Art
The level of ordinary skill in the art is “a prism or lens” through which
we view the prior art and the claimed invention. Okajima v. Bourdeau, 261
F.3d 1350, 1355 (Fed. Cir. 2001). The person of ordinary skill in the art is a
hypothetical person presumed to have known the relevant art at the time of
the invention. In re GPAC Inc., 57 F.3d 1573, 1579 (Fed. Cir. 1995). In
determining the level of ordinary skill in the art, we may consider certain
factors, including the “type of problems encountered in the art; prior art
solutions to those problems; rapidity with which innovations are made;
sophistication of the technology; and educational level of active workers in
the field.” Id. (internal quotation marks and citation omitted).
Petitioner contends that a person having ordinary skill in the art at the
time of the invention (“POSITA”) “would have had a Bachelor’s of Science
degree in engineering (e.g., mechanical, petroleum, or chemical engineering)
or an equivalent degree” and through education or experience, would have

2 The parties have not directed us to any such objective evidence.
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“familiarity with directional drilling principles.” Pet. 16 (citing Ex. 1005
¶ 71).
Patent Owner does not contest Petitioner’s definition or offer a
definition of its own. See generally Prelim. Resp.
We find Petitioner’s description to be consistent with the problems
and solutions disclosed in the ’593 patent and prior art of record, and adopt it
as our own for purposes of this Decision. See, e.g., In re GPAC Inc., 57
F.3d at 1579 (approving the determination of the level of ordinary skill in
the art by appeal to the references of record).
C. Claim Construction
In an inter partes review, claims are construed using the same claim
construction standard that would be used to construe the claims in a civil
action under 35 U.S.C. § 282(b), including construing the claims in
accordance with the ordinary and customary meaning of such claims as
understood by one of ordinary skill in the art and the prosecution history
pertaining to the patent. 37 C.F.R. § 42.100(b). Thus, we apply the claim
construction standard as set forth in Phillips v. AWH Corp., 415 F.3d 1303
(Fed. Cir. 2005) (en banc). In addition to the specification and prosecution
history, we also consider use of the terms in other claims and extrinsic
evidence including expert and inventor testimony, dictionaries, and learned
treatises, although extrinsic evidence is less significant than the intrinsic
record. Id. at 1312–17. Usually, the specification is dispositive, and it is the
single best guide to the meaning of a disputed term. Id. at 1315.
The specification may reveal a special definition given to a claim term
by the patentee, or the specification may reveal an intentional disclaimer or
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disavowal of claim scope by the inventor. Phillips, 415 F.3d at 1316. If an
inventor acts as his or her own lexicographer, the definition must be set forth
in the specification with reasonable clarity, deliberateness, and precision.
Renishaw PLC v. Marposs Societa’ per Azioni, 158 F.3d 1243, 1249 (Fed.
Cir. 1998). A disavowal, if any, can be effectuated by language in the
specification or the prosecution history. Poly-America, L.P. v. API Indus.,
Inc., 839 F.3d 1131, 1136 (Fed. Cir. 2016). “In either case, the standard for
disavowal is exacting, requiring clear and unequivocal evidence that the
claimed invention includes or does not include a particular feature.” Id.
“Ambiguous language cannot support disavowal.” Id. (citing Omega Eng’g,
Inc. v. Raytek Corp., 334 F.3d 1314, 1324 (Fed. Cir. 2003)).
Only those terms that are in controversy need be construed, and only
to the extent necessary to resolve the controversy. Nidec Motor Corp. v.
Zhongshan Broad Ocean Motor Co., 868 F.3d 1013, 1017 (Fed. Cir. 2017)
(citing Vivid Techs., Inc. v. Am. Sci. & Eng’g, Inc., 200 F.3d 795, 803 (Fed.
Cir. 1999)).
Petitioner argues that “[t]he ’634 Patent defines the term ‘quill
position’ by broadly stating what it may include,” but Petitioner does not
state concisely what definition it ascribes to the term. Pet. 25–26 (quoting
Ex. 1001, 5:43–64).
Patent Owner does not address Petitioner’s contentions or otherwise
address claim construction. See generally Prelim. Resp.
For purposes of this Decision, and based on the record before us, we
determine that no construction of any term is necessary.
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D. Overview of the Asserted Prior Art
1. Haci
Haci discloses “a method of and an apparatus for directional drilling
with a steerable drilling motor.” Ex. 1006, 1:24–26. Typically, changing
the direction of the well bore is accomplished through slide drilling, in
which the drill string is not rotated and the direction of drilling is determined
by the tool face angle of the drilling motor. Id. at 1:66–2:3. Several
difficulties arise in this method of directional drilling, including friction
between the drill string and the well bore and controlling the orientation of
the drilling motor during slide drilling. Id. at 2:18–3:35. Haci purports to
provide a more efficient method and an apparatus for directional drilling
with a steerable drilling motor. Id. at 3:50–51. Haci discloses an iterative
method of drilling a bore hole that “comprises rotary drilling at a first
rotation rate until a first target value is substantially met, changing the first
rotation rate to a second rotation rate when a trigger is substantially met, and
then drilling at the second rotation rate until a second target value is
substantially met.” Id. at 3:58–67. The second rotation rate is less than the
first rotation rate, causing drilling to be concentrated in a particular
direction. Id. at 7:51–64. Additionally, the second rotation rate can be zero
such that the method alternates between rotary drilling and slide drilling. Id.
at 8:9–14. Targets for determining when to start checking for a trigger
include weight on bit, differential pressure, downhole reactive torque, and a
set time period. Id. at 7:38–47. Triggers for determining when to change
the rotation rate include tool face angle and torque. Id. at 7:65–67, 9:37–60.
The drilling control system includes a number of sensors for
measuring various drilling parameters, including directional sensor 51
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located on the bottom hole assembly, drill string torque sensor 53 located at
the surface, and drill string torque sensor 63 located at the surface.
Ex. 1006, 4:60–5:3, 5:58–67, Fig. 1. The system includes driller’s screen 71
that displays pertinent drilling information to the driller (drilling rig
operator) and provides a graphical user interface to the system. Id.
at 6:16–20. Figure 3 illustrates the driller’s screen and is reproduced below.

Figure 3 is a pictorial view of driller’s screen 71. Id. at 4:10–11, 6:16–19.
The screen includes a number of indicators, including tool face indicator 73
that “displays the tool face angle derived from the output of the steering
tool,” pump pressure indicator 75, differential pressure indicator 79, and
actual trigger indicator 101. Id. at 6:25–7:2. The screen also includes
graphical display 113 that “shows plots of differential pressure vs. time 115
and torque vs. time 117 for the driller.” Id. at 7:5–7.
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2. Jones
Jones discloses “a method and apparatus for oscillatory control of a
drill string used for subterranean drilling.” Ex. 1007, 1:17–18. “During
straight path drilling, the drill string is continuously rotated in a single
direction about its longitudinal axis to reduce the effect of friction and
increase the penetration rate.” Id. at 1:51–54. During directional drilling,
“the continuous rotation of the drill string is terminated.” Id. at 1:57–58. To
reduce friction between the bore hole and the drill string during directional
drilling, “the drill string can alternate between rotation in forward (e.g.,
clockwise) and reverse (e.g., counterclockwise) directions.” Id. at 2:13–16.
These iterative clockwise and counterclockwise rotations are controlled such
that the drill bit is not rotated due to the length and torsional spring
properties of the drill string. Id. at 2:16–23. In this manner, friction is
reduced during directional drilling. Id. at 2:23–27. However, “it can be
difficult to achieve the desired back and forth rotation without affecting the
orientation of the toolface during directional drilling.” Id. at 2:27–29.
Jones purports to improve upon conventional directional drilling by
providing for adjustment of the times during which clockwise and
counterclockwise rotation take place. Ex. 1007, code (57). The absolute
angle of the drill string at the rig, which may be several revolutions from the
default position, is estimated using a rotation sensor on the top drive. Id.
at 6:23–34. An offset angle is determined by averaging the maximum and
minimum absolute rotation angles over several oscillation cycles and
calculating the difference between this average absolute angle value and the
target drill string rotation angle. Id. at 6:41–48. If the toolface was correctly
oriented prior to initiating oscillation, the offset angle is zero. Id.
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at 6:48–50. If the offset angle is not zero, the times of clockwise rotation
and counterclockwise rotation can be adjusted to correct the toolface
orientation. Id. at 6:56–7:7.
3. Maidla
Maidla provides “program facts” regarding a system for directional
drilling that employs robotics and software to automate rocking during slide
drilling. Ex. 1008, 1. Maidla purports that its system “controls torque from
the surface with a combination of hardware and software that integrates
surface and [measurement while drilling] data to automate rocking during
sliding.” Id. The system includes a user interface that presents various data
to the operator, including plots of torque data and pressure data. Id.
4. Leder
Leder discloses a directional drilling system that avoids collisions
while drilling on multi-well locations. Ex. 1009, 7. Leder describes a
software application that performs calculations based on measurement while
drilling data and provides a polar graph to the operator displaying relative
positions of the existing wells. Id. The system projects the drilling
trajectory beyond the current location and triggers an alarm if any of the
offset wells come within a specified proximity. Id.
5. Cobern
Cobern discloses a method “for use in borehole drilling, for correcting
errors in azimuth determination resulting from variations in the earth’s
magnetic field to which a measuring instrument is exposed.” Ex. 1010,
code (57). Cobern uses a microprocessor that “calculates various values,
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such as drillers’ angles (azimuth, inclination, gravity tool face reference
(GTF) or magnetic tool face reference (MTF))” as depicted in Figure 3. Id.
at 4:65–5:1. GTF values are typically used in the calculations, but MTF
values are used if the drill string is substantially aligned with the vertical
axis. Id. at 5:32–40. The outputs from the microprocessor are then
delivered to a valve driver to operate a valve to create mud pulse signals for
eventual display. Id. at 5:2–5.
E. Asserted Obviousness Based on Haci, Cobern, and Jones
Petitioner argues that claims 1, 4–7, 9, 10, and 12 would have been
obvious over the combination of Haci, Cobern, and Jones. Pet. 26–71. In
support of its showing, Petitioner relies upon the Schaaf Declaration. Id.
(citing Ex. 1005). We have reviewed Petitioner’s assertions and supporting
evidence. For the reasons discussed below, and based on the record before
us, we determine that Petitioner does not demonstrate a reasonable
likelihood of prevailing in showing that claims 1, 4–7, 9, 10, and 12 would
have been obvious over the combination of Haci, Cobern, and Jones.
Independent claim 1 recites, in relevant part,
receiving electronic data on a recurring basis, wherein the
electronic data includes quill position data and at least one of
gravity-based toolface orientation data and magnetic-based
toolface orientation data; and
displaying the electronic data on a user-viewable display
in a historical format depicting data resulting from a most
recent measurement and a plurality of immediately prior
measurements.
Ex. 1001, 10:39–46.
Petitioner argues that Haci discloses displaying toolface orientation
data in a historical format. Pet. 43–46. Petitioner presents an annotated
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version of Haci Figure 3, which is reproduced below, in support of its
arguments.

Haci Figure 3 is a pictorial view of driller’s screen 71, and Petitioner’s
annotations identify a “toolface (deg)” label on a Y-axis and asserted
toolface vs. time data having regions Petitioner describes as “flat line” and
“dispersed dots.” Id. at 44. According to Petitioner, Haci’s graphical
display 113 includes “an unlabeled plot composed of small dots” that an
ordinarily skilled artisan “would have recognized . . . as a plot of toolface vs.
time” for two reasons. Id. at 44–45 (citing Ex. 1005 ¶ 129). First, Petitioner
argues that “the unlabeled plot on Haci’s Figure 3 is consistent with the
expected behavior for a toolface vs. time plot” because it is “relatively flat”
during slide drilling and “randomly dispersed between 0 and 360 degrees”
during rotary drilling. Id. at 45 (citing Ex. 1005 ¶ 130). Second, Petitioner
argues that “the Y-Axis label of ‘toolface (deg)’ indicates that toolface is
plotted. . . . The other labeled axes have corresponding data, so a POSITA
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would have recognized the unlabeled plot was toolface vs. time.” Id.
at 45–46 (citing Ex. 1005 ¶ 131).
Patent Owner argues that Petitioner relies only on its declarant’s
“conclusory testimony” to support its contention that “the plot of toolface vs.
time in [Haci] Figure 3 corresponds to ‘an unlabeled plot composed of small
dots’ within a portion of a graphical display (113) in Haci’s driller’s screen.”
Prelim. Resp. 10–12 (citing Pet. 43–46; Ex. 1005 ¶¶ 129–132). Patent
Owner argues that Mr. Schaaf’s testimony is conclusory and “is therefore
entitled to little or no weight.” Id. at 12 (citing 37 C.F.R. § 42.65(a)).
Continuing, Patent Owner asserts that “neither Petitioner[] nor Mr. Schaaf
point[s] to any disclosure in Haci to corroborate their allegation that ‘Haci’s
graphical display [is] a plot of toolface vs. time’” and, thus, Petitioner’s
contentions are “purely speculative, based entirely on hindsight bias.” Id.
at 12–13 (third alteration in original).
We agree with Patent Owner. Haci does not discuss the “small dots”
identified by Petitioner at all, let alone as a plot of toolface orientation
versus time. Rather, Haci discloses that toolface orientation data is
displayed elsewhere on the driller’s screen: “Screen 71 includes a tool face
indicator 73, which displays the tool face angle . . . .” Ex. 1006, 6:25–26.
Haci also discloses what is shown in its display: “[G]raphical display 113
shows plots of differential pressure vs. time 115 and torque vs. time 117 for
the driller.” Id. at 7:5–7. To support its contentions, Petitioner does little
more than cite to its annotated version of Haci Figure 3 and the Schaaf
Declaration, which in large measure presents the same conclusory assertions
advanced in the Petition. See Pet. 43–46; Ex. 1005 ¶¶ 126–133. Such
speculation is inadequate to support Petitioner’s contentions. Neither
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Petitioner nor Mr. Schaaf support adequately the contention that an
ordinarily skilled artisan would interpret the “small dots” identified by
Petitioner in Haci Figure 3 as “a plot of toolface vs. time.” Pet. 44–46;
Ex. 1005 ¶¶ 128–133. For example, neither Petitioner nor Mr. Schaaf
explains why Haci’s disclosure describes toolface orientation data being
displayed to the user via tool face indicator 73 (Ex. 1006, 6:25–26), but fails
to discuss the alleged toolface orientation data in graphical display 113.
Similarly, neither Petitioner nor Mr. Schaaf explains why Haci’s disclosure
describes graphical display 113 as presenting differential pressure data and
torque data (id. at 7:5–7), but fails to discuss the alleged toolface orientation
data.
Additionally, neither Petitioner nor Mr. Schaaf explain why the
asserted toolface orientation data is presented as “randomly dispersed” dots
rather than as a line graph in the manner that the differential pressure and
torque data is presented in Haci Figure 3. Nor does Petitioner or Mr. Schaaf
explain how the “randomly dispersed” dots would be useful to the operator.
It is difficult to imagine how any useful information could be conveyed by
the “randomly dispersed” dots identified by Petitioner in its annotated
version of Haci Figure 3. To this end, tool face indicator 73 shows that the
tool face is oriented at 242°, which is not readily determinable via the “small
dots” identified by Petitioner.
Furthermore, both Petitioner and Mr. Schaaf fail to reconcile the
asserted plot of toolface orientation data with Haci’s disclosure. Haci
discloses exemplary values of approximately 10 seconds for each iteration of
rotary drilling and slide drilling (even when the target values are based on
differential pressure). Ex. 1006, 9:24–28, 10:30–35. At 40 rpm drill string
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rotation during rotary drilling (id. at 7:51–55), the toolface would rotate
approximately 6.6 revolutions during each iteration of rotary drilling.
Petitioner fails to address this disclosure of Haci or explain how the
“randomly dispersed” dots convey this number of revolutions. Moreover,
the unlabeled dots relied upon by Petitioner would seem to indicate a much
faster rate of rotation than contemplated by Haci.
Finally, Petitioner’s arguments are inconsistent with the family
prosecution history of Haci. On September 11, 2007, the Haci applicant
submitted a PCT Request claiming priority to the application resulting in the
asserted Haci reference. Ex. 3002, 1–4. The U.S. Receiving Office
responded with an Invitation to Correct Defects, indicating that a new
drawing for Figure 3 was required. Id. at 5–8. In response, the applicant
submitted a substitute Figure 3. Id. at 9–10. This figure is reproduced
below.

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Substitute Figure 3 is a formal version of Haci Figure 3. Notably, the
substitute figure does not contain the “unlabeled plot composed of small
dots” that Petitioner asserts to be a plot of toolface orientation data. If the
dots identified by Petitioner were, in fact, a plot of toolface orientation
versus time, it seems likely that the dots would not have been deleted in the
formal version of Figure 3.
For at least these reasons, the arguments and evidence presented in the
Petition fail to provide sufficient support for Petitioner’s contentions that
Haci discloses toolface orientation data as recited in claim 1 and
incorporated into its dependent claims 4–7, 9, 10, and 12. Petitioner relies
on Cobern to teach receiving toolface data that is gravity-based or magnetic-
based depending on drill string orientation and on Jones to teach displaying
quill data in a historical format, but does not assert that these secondary
references disclose displaying toolface orientation data in a historical format.
See Pet. 26–49, 65–71. Therefore, Petitioner does not demonstrate a
reasonable likelihood of prevailing in showing that claims 1, 4–7, 9, 10,
and 12 would have been obvious over the combination of Haci, Cobern, and
Jones.
F. Asserted Obviousness Based on Haci, Cobern, Jones, and Leder
Petitioner argues that claim 2 and 3 would have been obvious over the
combination of Haci, Cobern, Jones, and Leder. Pet. 71–76. Petitioner
relies on Haci, Cobern, and Jones as set forth in § II.E above and relies on
Leder to teach displaying azimuth data and inclination data in a historical
format. Id.
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Claims 2 and 3 depend from claim 1. As Petitioner has failed to
establish that Haci, Cobern, and Jones satisfy the recitations of claim 1 as
discussed above, Petitioner has likewise failed to establish how these
recitations are satisfied with respect to these dependent claims. Thus, the
Petition has not demonstrated a reasonable likelihood of prevailing in
showing that claims 2 and 3 would have been obvious over the combination
of Haci, Cobern, Jones, and Leder.
G. Asserted Obviousness Based on Haci, Cobern, Jones, and Maidla
Petitioner argues that claims 8 and 11 would have been obvious over
the combination of Haci, Cobern, Jones, and Maidla. Pet. 76–84. Petitioner
relies on Haci, Cobern, and Jones as set forth in § II.E above and relies on
Maidla to teach graphically displaying older data as a target-shaped
representation. Id.
Claims 8 and 11 depend from claim 1. As Petitioner has failed to
establish that Haci, Cobern, and Jones satisfy the recitations of claim 1 as
discussed above, Petitioner has likewise failed to establish how these
recitations are satisfied with respect to these dependent claims. Thus, the
Petition has not demonstrated a reasonable likelihood of prevailing in
showing that claims 8 and 11 would have been obvious over the
combination of Haci, Cobern, Jones, and Maidla.
H. Discretionary Denial
Patent Owner argues that we should exercise our discretion under
35 U.S.C. § 314(a) to deny institution of inter partes review in view of the
Texas litigation. Prelim. Resp. 30–51; Prelim. Sur-reply 1–5. Because we
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Patent 7,802,634 B2

22
have considered the merits of Petitioner’s challenges and decline to institute
inter partes review on that basis, we need not determine whether it would be
appropriate to exercise our discretion to deny institution of inter partes
review under § 314(a).
III. CONCLUSION
For the foregoing reasons, we are not persuaded that the Petition
establishes a reasonable likelihood that Petitioner would prevail in any of its
challenges to claims 1–12 of the ’634 patent.
IV. ORDER
In consideration of the foregoing, it is hereby ordered that the Petition
is denied, and no trial is instituted.
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Patent 7,802,634 B2

23
For PETITIONER:
Chad C. Walters
Douglas M. Kubehl
Clarke W. Stavinoha
BAKER BOTTS L.L.P.
chad.walters@bakerbotts.com
doug.kubehl@bakerbotts.com
clarke.stavinoha@bakerbotts.com
For PATENT OWNER:
David M. O’Dell
Jonathan R. Bowser
Jeffrey A. Wolfson
Vera L. Suarez
HAYNES AND BOONE, LLP
david.odell.ipr@haynesboone.com
jon.bowser.ipr@haynesboone.com
jeff.wolfson.ipr@haynesboone.com
vera.suarez.ipr@haynesboone.com