Sunoco Partners Mktg. v. U.S. Venture, Inc.

339 F. Supp. 3d 803
CourtDistrict Court, E.D. Illinois
DecidedOctober 6, 2018
DocketNo. 15 C 8178
StatusPublished
Cited by5 cases

This text of 339 F. Supp. 3d 803 (Sunoco Partners Mktg. v. U.S. Venture, Inc.) is published on Counsel Stack Legal Research, covering District Court, E.D. Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Sunoco Partners Mktg. v. U.S. Venture, Inc., 339 F. Supp. 3d 803 (illinoised 2018).

Opinion

REBECCA R. PALLMEYER, United States District Judge

Plaintiff Sunoco Partners Marketing and Terminals L.P. ("Sunoco") is the holder of five patents covering a system and method for blending butane into gasoline immediately before the mixture is distributed to the tanker trucks that supply retail gas stations. Sunoco sued Defendant U.S. Venture, Inc. and its subsidiary, U.S. Oil Co. (together, "Venture"), for infringing Sunoco's patents at six of Venture's fuel terminals. (Am. and Supp. Compl. for Patent Infringement [161] ("Sunoco's Am. Compl."), 4.) Venture filed numerous counterclaims in response, seeking declaratory judgments of non-infringement, invalidity, and unenforceability based on the inventors' allegedly inequitable conduct before the U.S. Patent and Trade Office ("PTO") during the patents' prosecution. (Venture's Answer, Aff. Defenses, and Countercls. to Pl.'s Am. Compl. [174] ("Venture's Am. Answer"), 52-89.) In a previous opinion, this court granted partial summary judgment in favor of Sunoco on several of its infringement claims. Sunoco Partners Marketing & Terminals L.P. v. U.S. Venture, Inc. , No. 15 C 8178, 2017 WL 4283946, at *1 (N.D. Ill. Sept. 27, 2017) (" Sunoco SJ Opinion I ").

The parties have now filed additional, opposing motions for summary judgment. Venture seeks summary judgment of non-infringement, a declaration of invalidity of certain claims in Sunoco's patents, and a ruling barring an award of lost profits damages. (Venture's SJ Mot. [363], 1-2.) Sunoco's cross-motion for summary judgment does not seek further rulings on the question of infringement, but does ask the court to dismiss certain of Venture's counterclaims before trial. To this end, Sunoco moves for an order declaring that (1) three *813references identified by Venture are not prior art under 35 U.S.C. § 102 ; and (2) Sunoco's patents are not unenforceable due to inequitable conduct. (Sunoco's SJ Mot. [354], 1.) For the reasons stated below, Sunoco's motion is granted and Venture's motion is granted in part and denied in part.

BACKGROUND

Sunoco is the holder of five patents on systems that blend butane and gasoline: U.S. Patent No. 6,679,302 (the "'302 Patent") ; No. 7,032,629 (the "'629 Patent") ; No. 7,631,671 (the "'671 Patent") ; No. 9,494,948 (the "'948 Patent") ; and Patent 9,606,548 (the "'548 Patent"). The court has already described the invention in detail in its claim construction opinion, see Sunoco Partners Marketing & Terminals L.P. v. U.S. Venture, Inc. , No. 15 C 8178, 2017 WL 1550188, at *1-3 (N.D. Ill. Apr. 28, 2017) (" Sunoco Markman Opinion "), and first summary judgment opinion, see Sunoco SJ Opinion I , 2017 WL 4283946, at *1-7. The court presumes the reader's familiarity with those opinions and provides only a brief summary of the relevant facts here.

The court's previous summary judgment opinion explained that

[c]ommercial purveyors of gasoline-those that sell gasoline by the tankload to consumer-facing retail gas stations-add butane because it is more volatile than gasoline, allowing cars to start consistently in colder weather. Because adding lower-priced butane to gasoline improves profit margins, commercial sellers are motivated to blend as much butane as possible into gasoline before selling it to retail stations.
That goal, however, is complicated by United States Environmental Protection Agency ("EPA") regulations. As noted, adding butane to gasoline increases the volatility of the blended gasoline, but gasoline with higher volatility contributes to smog, a particular concern in warmer climates and during summer months. Gasoline Reid Vapor Pressure , EPA.GOV, https://www.epa.gov/gasoline-standards/gasoline-reid-vapor-pressure (last accessed Oct. 6, 2017). The EPA therefore imposes limits on the allowable volatility of gasoline, measured by "Reid Vapor Pressure" or RVP, based on the month and the state where the gasoline is sold. Limits range from an RVP of 7.8 pounds per square inch to 15....
The patented systems allow the patent holder to blend butane into gasoline at the last point of distribution before the gas is taken by tanker trucks to retail gas stations; called "terminals" or "tank farms," these facilities receive gasoline from refineries and store it in large tanks for distribution. (See '302 Patent col. 4 ll. 38-60.) In an exemplary embodiment, the system blends butane into gasoline immediately before it is dispensed into a tanker truck: butane and gasoline are drawn from a tank of each, blended to the desired RVP in a blending unit, and dispensed to the truck. (E.g. , '302 Patent col. 3 ll. 14-27.)

Sunoco SJ Opinion I , 2017 WL 4283946, at *1 (internal citations to record omitted).

Variations on these systems, as described in Sunoco's later patents, relate to "in-line processes for blending butane into a gasoline stream, that allow butane to be blended into a gasoline stream at any point along a petroleum pipeline." ( '948 Patent, col. 1 ll. 22-25; '548 Patent, col. 1 ll. 22-25.) The invention described in these patents "combin[es] the advantages of in-line vapor pressure monitoring both upstream and downstream of a butane blending operation," thereby allowing users "to blend butane with petroleum products at practically any point along a petroleum pipeline, regardless of variations in the flow rate of gasoline through the pipeline, the time of *814year in which the gasoline is delivered, or the ultimate destination to which the gasoline is delivered." ( '948 Patent, col. 3 ll. 18-26; '548 Patent, col. 3 ll. 18-26.)

Steven Vanderbur and Larry Mattingly are named as the inventors on all five patents at issue in this case. For an unidentified period before February 2001, both Vanderbur and Mattingly worked with a company called Texon Terminals to install and operate gasoline and butane blending equipment. (Sunoco's 2016 Statement of Material Facts [132] (hereafter "Sunoco's 2016 SOF"), at ¶ 11.) On February 9, 2001, Mattingly and Vanderbur filed the provisional application that resulted in each of the five patents. (Venture's 2017 Statement of Material Facts [371] (hereafter "Venture's SOF"), at ¶ 3; '302 Patent.) Mattingly and Vanderbur subsequently assigned the patents to Texon, and Sunoco became the patents' sole owner when it purchased Texon's butane blending business in 2010. Sunoco SJ Opinion I

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