Trials@uspto.gov
`Tel: 571-272-7822
`
`IPR2017-01242, Paper 30
`IPR2017-01241, Paper 30
`Entered: October 20, 2017
`
`UNITED STATES PATENT AND TRADEMARK OFFICE
`
`BEFORE THE PATENT TRIAL AND APPEAL BOARD
`
`ASPHALT PRODUCTS UNLIMITED, INC.
`Petitioner,
`
`v.
`
`BLACKLIDGE EMULSIONS, INC.,
`Patent Owner.
`
`Case IPR2017-01241 (Patent 7,503,724 B2)
`Case IPR2017-01242 (Patent 7,918,624 B2)
`
`Before MITCHELL G. WEATHERLY, JAMES A. TARTAL, and
`TIMOTHY J. GOODSON, Administrative Patent Judges.
`
`GOODSON, Administrative Patent Judge.
`
`ORDER
`Denying Patent Owner’s Motion to Disqualify Alan James, Ph.D. as
`Petitioner’s Expert Witness and to Strike His Declaration
`37 C.F.R. §§ 42.5, 42.20
`
`

`

`IPR2017-01241 (Patent 7,503,724 B2)
`IPR2017-01242 (Patent 7,918,624 B2)
`
`INTRODUCTION
`I.
`After receiving authorization (see Paper 121), Patent Owner filed a
`motion to disqualify Alan James, Ph.D. as Petitioner’s expert witness and to
`strike Dr. James’ declaration. Paper 15 (“Mot.”). Patent Owner argues that
`as part of a collaboration between Patent Owner and Akzo Nobel Surface
`Chemistry LLC (“Akzo”), Patent Owner provided to Dr. James confidential
`information relating to Patent Owner’s manufacturing processes and
`materials. Id. at 1. Further, according to Patent Owner, the work Dr. James
`did for Patent Owner is “inextricably linked” with his testimony in these
`proceedings. Id. at 1–2. Petitioner opposes the Motion, arguing that
`Dr. James has not used any of Patent Owner’s confidential information in
`these proceedings. Paper 18 (“Opp.”), 1.2 For the reasons discussed below,
`we deny Patent Owner’s Motion to Disqualify Dr. James as Petitioner’s
`Expert Witness and to Strike His Declaration.
`LEGAL STANDARD
`II.
`In evaluating motions to disqualify the opposing party’s expert, we
`require the moving party to show (1) that “it is objectively reasonable for the
`moving party to believe that it had a confidential relationship with the
`expert” and (2) that “the moving party disclosed confidential information to
`the expert that is relevant to the current proceeding.” Agila Specialties Inc.
`v. Cephalon, Inc., Case IPR2015-00503, slip op. at 4–5 (PTAB Aug. 19,
`2015) (Paper 13) (citing Lacroix v. BIC Corp., 339 F. Supp. 2d 196, 199 (D.
`Mass. 2004); Mayer v. Dell, 139 F.R.D. 1, 3 (D.D.C. 1991)); see also
`
`
`1 Unless indicated otherwise, citations in this Order refer to the papers and
`exhibits in Case IPR2017-01242. Similar or identical documents to those
`referenced herein exist in IPR2017-01241.
`2 A redacted, public version of Petitioner’s Opposition was filed as Paper 19.
`
`2
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`IPR2017-01241 (Patent 7,503,724 B2)
`IPR2017-01242 (Patent 7,918,624 B2)
`
`FujiFilm Corp. v. Sony Corp., Case IPR2017-01267, slip op. at 2–3 (PTAB
`July 10, 2017) (Paper 9) (applying same standard); Solenis LLC v. Ecolab
`USA, Case IPR2016-01281, slip op. at 2–5 (PTAB Oct. 5, 2016) (Paper 29)
`(applying same standard). The Board’s decisions indicate that
`“[d]isqualification of an expert witness is a drastic measure” that must be
`supported by specific information from the movant regarding what
`confidential information was disclosed and how it pertains to the proceeding.
`FujiFilm, slip op. at 6–7; Solenis, slip op. at 4.
`III. ANALYSIS
`Patent Owner asserts that it had a confidentiality agreement with Akzo
`that extends to Akzo’s employees, including Dr. James. Mot. 2–3 (citing
`Ex. 2012 ¶ 4). Petitioner does not contest that assertion, although it does
`argue that this is “neither a former-employee case nor a case of side-
`switching” because the confidentiality agreement was between Patent Owner
`and Akzo. See Opp. 6. The record supports Patent Owner’s contentions that
`Dr. James was involved in the negotiation of a confidentiality agreement
`between Patent Owner and Akzo, Dr. James’ employer, and that the
`confidentiality agreement was entered in April 2010. See Ex. 2011, 2–3;
`Ex. 2012, 1.3 The confidentiality agreement provides:
`The Receiving Party may disclose the Confidential Information
`to those of its . . . employees . . . (“Restricted Personnel”) on a
`strict need to know basis and subject to the terms and conditions
`of this Agreement. . . . The Receiving Party shall be responsible
`for any breach of this Agreement by such Restricted Personnel
`
`3 We note that this confidentiality agreement came well after the filing dates
`of the patents being challenged in these proceedings. The application that
`issued as the ’724 patent was filed on November 20, 2006, and the
`application that issued as the ’624 patent was filed on March 12, 2009 as a
`continuation of the ’724 patent. Ex. 1001, (22), (63).
`
`3
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`IPR2017-01241 (Patent 7,503,724 B2)
`IPR2017-01242 (Patent 7,918,624 B2)
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`described herein to whom the Receiving Party discloses
`Confidential Information.
`Ex. 2012 ¶ 4. Thus, Petitioner has made a sufficient showing on the first
`prong of the Agila test.
`Turning to the second prong, Patent Owner argues that it disclosed to
`Akzo and Dr. James proprietary information about manufacturing processes,
`selected base asphalts, and manufacturing facilities. Mot. 1. Using that
`information, Dr. James developed formulations and processes that he sent to
`Patent Owner for testing. Id. According to Patent Owner, the testing
`described in Dr. James’ declaration in these proceedings show the same
`parameters that Dr. James used in his confidential work with Patent Owner.
`Id. at 2. Thus, Patent Owner contends that “Dr. James received confidential
`information needed to arrive at a tack coat that successfully practices the
`claimed invention on the first try.” Id. at 3.
`The specific items of confidential information that Patent Owner
`identifies in its Motion are preferred suppliers of hard pen asphalt and
`certain characteristics of the emulsion formulation. Id. at 4–6. Patent
`Owner asserts that it disclosed to Dr. James three preferred sources of hard-
`pen asphalt that did not require a peptizer, and that one of those three was
`
`. Id. at 5–6. Further, according to Patent Owner, the testing in
`these proceedings used Redicote E-9 at 0.3% and soap pH from 1.7–1.8. Id.
`at 4–5 (citing Ex. 1013, 16–18). Those parameters match the recipe in a
`summary presentation from the collaboration between Patent Owner and
`Akzo, which calls for
` or
` and a soap pH of
`. Id. at 4 (citing Ex. 2009, 14). Patent Owner emphasizes that the pH
`scale is logarithmic, such that “the choice of pH—
`
`
`
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`IPR2017-01241 (Patent 7,503,724 B2)
`IPR2017-01242 (Patent 7,918,624 B2)
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`—can have substantial effects on the success of an
`asphalt emulsion.” Id. at 5.
`In response, Petitioner argues that the testing in these proceedings
`sought to faithfully replicate the emulsion recipes of Pasquier, the main prior
`art reference of Petitioner’s patentability challenges, and was not based on
`any information Dr. James received from Patent Owner. Opp. 1. Regarding
`the specific items of confidential information alleged by Patent Owner,
`Petitioner argues that asphalt suppliers advertise their products on their
`websites, including
`, which states on its website that its hard pen
`asphalts are produced at the plant in
`. Opp. 2.
`Further, Petitioner points to sworn declarations from both Dr. James and
`Steele Yeargain, Petitioner’s Vice President, that Dr. James had no
`involvement with the source of asphalt used in the testing for these
`proceedings. Id. at 2 (citing Ex. 1040 ¶¶ 9–18; Ex. 1040 ¶ 12).
`Specifically, Dr. James testifies that “I did not provide APU
`recommendations regarding the sourcing of the asphalt for the PRI testing,
`nor have I any recollection of ever providing APU recommendations on
`asphalt suppliers for use in their asphalt emulsion formulations.” Ex. 1040
`¶ 12. Mr. Yeargain testifies that “I was tasked by APU’s counsel with
`securing a supply of hard-pen base asphalt equivalent to the 10/20 hard-pen
`asphalt disclosed in Pasquier.” Ex. 1042 ¶ 11. Mr. Yeargain testifies that
`Petitioner has been purchasing medium-hard pen asphalt from Marathon’s
`plant in Garyville, Louisiana since the 1990’s, and has been purchasing
` plant since August 2010. Id.
`hard-pen asphalt from
`¶¶ 13–16. Mr. Yeargain further testifies:
`For the PRI testing, in October 2016, I pulled about 5 gallons
`from APU’s existing inventory of 0-pen base asphalt previously
`
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`IPR2017-01241 (Patent 7,503,724 B2)
`IPR2017-01242 (Patent 7,918,624 B2)
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`
`purchased from
`and about 5 gallons of PG 67-22 base asphalt previously
`purchased from Marathon Petroleum (Garyville, Louisiana), and
`shipped these samples to PRI. The decision to provide
`
` base asphalts used in the testing conducted at PRI
`was my decision alone.
`Id. ¶¶ 17–18.
`
`With respect to the emulsion formulation characteristics, Petitioner
`argues that Patent Owner has not established that the emulsion recipe in
`Exhibit 2009 constitutes Patent Owner’s confidential information under the
`confidentiality agreement. Opp. 5–6. Petitioner contends that the
`presentation in Exhibit 2009 on which Patent Owner relies indicates that
`Akzo was the disclosing party for that recipe, not Patent Owner. Id. at 6.
`Moreover, Petitioner argues that it was known before 2010 that a pH target
`range of 1.5–2.0 is typical for a stable asphalt emulsion using Redicote E-9.
`Opp. 5. To support that assertion, Petitioner points to a 2006 publication by
`Dr. James which lists a soap pH range of 1.5–2.5 for a cationic rapid set
`emulsion in a table of “Typical Emulsion Recipes.” See id. at 3; Ex. 1037,
`9. The 2001 product data sheet for Redicote E-9 lists the following “Typical
`Emulsion Formulations:”
`
`
`Ex. 1036, 2. Petitioner also cites the testimony of Mr. Yeargain that in May
`2000 and November 2007, Akzo provided Petitioner with technical service
`reports describing testing of emulsion formulations using Redicote E-9
`having pH targets of 1.8 and 1.5. Opp. 3–4; Ex. 1042 ¶¶ 28–29.
`
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`IPR2017-01241 (Patent 7,503,724 B2)
`IPR2017-01242 (Patent 7,918,624 B2)
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`After reviewing the parties’ arguments and evidence, we agree with
`Petitioner that Patent Owner has not made a sufficient showing under the
`second prong of the Agila test. We do not find adequate support for Patent
`Owner’s contention that Dr. James improperly used Patent Owner’s
`confidential information in the testing for these proceedings. The evidence
`currently of record indicates that the base asphalt used in the testing was
`simply what Petitioner had in its inventory, that Petitioner had been
`purchasing that base asphalt since 2010, and that Dr. James was not involved
`in selecting the base asphalt.
`Further, Patent Owner has not established that an emulsion
`formulation employing
` at
` or
` and a soap pH of
` constitutes Patent Owner’s confidential information that it disclosed to
`Dr. James. The presentation containing that recipe appears with Akzo’s logo
`and is attached to an email from Dr. James stating “I also attach the
`presentation I gave at the meeting. . . .” Ex. 2009, 1, 14. Under the
`confidentiality agreement between Akzo and Patent Owner, the “Disclosing
`Party” is the party that conveys information and the “Receiving Party” is the
`recipient of that information. Ex. 2012 ¶ 1. The confidentiality agreement
`imposes restrictions on the Receiving Party’s disclosure or use of
`confidential information. Id. ¶ 2 (“With regard to any Confidential
`Information disclosed hereunder, the Receiving Party shall not disclose
`Confidential Information to any third party, or use Confidential Information
`for any purpose other than the purpose of this Agreement.”). However,
`Patent Owner does not direct us to, and we do not find, restrictions in the
`confidentiality agreement on the Disclosing Party’s ability to disclose its
`own information to others. Moreover, Petitioner has presented evidence that
`
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`IPR2017-01241 (Patent 7,503,724 B2)
`IPR2017-01242 (Patent 7,918,624 B2)
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` at
`
` and soap pH from
`an emulsion formulation using
`, was within the
`, as was
`range of what was typical and generally known before 2010. Ex. 1037, 9;
`Ex. 1036, 2; Ex. 1042 ¶¶ 28–29.
`
`Looking beyond the specifics of the testing that has already been
`conducted, we are not persuaded by Patent Owner’s more generalized
`argument that “Dr. James received confidential information needed to arrive
`at a tack coat that successfully practices the claimed invention on the first
`try” and may use that information against Patent Owner in these
`proceedings. See Mot. 3. The patents themselves must include disclosure
`sufficient to enable an ordinarily skilled artisan to practice the claimed
`inventions without undue experimentation. See 35 U.S.C. ¶ 112; Invitrogen
`Corp. v. Clontech Labs. Inc., 429 F.3d 1052, 1070–71 (Fed. Cir. 2005)
`(“Section 112 requires that the patent specification enable those skilled in
`the art to make and use the full scope of the claimed invention without
`undue experimentation.”). This enablement requirement “ensures that the
`public knowledge is enriched by the patent specification to a degree at least
`commensurate with the scope of the claims.” National Recovery Techs. Inc.
`v. Magnetic Separation Sys., Inc., 166 F.3d 1190, 1195–96 (Fed Cir. 1999).
`Assuming that the confidential information is that which allows the claimed
`invention to be practiced “on the first try” (versus the publicly disclosed
`information of how to practice the invention without undue
`experimentation), it is unclear why that “first try” capability would bear on
`the grounds of unpatentability asserted in these proceedings.
`
`Because Patent Owner has not shown any specific information that is
`both confidential and relevant to these proceedings, Patent Owner’s Motion
`
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`IPR2017-01241 (Patent 7,503,724 B2)
`IPR2017-01242 (Patent 7,918,624 B2)
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`is denied. However, we note that Patent Owner is currently pursuing a
`lawsuit against Dr. James and Akzo for trade secret misappropriation and
`breach of contract. See Ex. 2001, 7–8; Blacklidge Emulsions, Inc. v. Akzo
`Nobel Surface Chemistry LLC, Case No. 1:17-cv-173-LG-RHW (S.D.
`Miss.) (“Mississippi Case”). In the Mississippi Case, Patent Owner has filed
`a motion for a preliminary injunction, through which it seeks to preclude Dr.
`James from disclosing confidential information in these proceedings. Ex.
`2001, 7. Based on the publicly available docket sheet and the transcript of
`the hearing on the motion for a preliminary injunction (Ex. 2022), the
`evidentiary record in the Mississippi Case appears to be significantly more
`extensive than what has been presented in these proceedings. The parties
`should keep the Board apprised of developments in the Mississippi Case that
`impact these proceedings, including any rulings on the motion for a
`preliminary injunction or any other rulings that impact Dr. James’
`participation in these proceedings.
`
`Finally, this Order discusses information that is the subject of a
`pending motion to seal. See Paper 20. Accordingly, we have entered this
`Decision in the Board’s PRPS system as “Board and Parties Only.” If either
`Party believes that any portion of the Order should be maintained under seal,
`the Party must file, within five business days of the entry of this Order, a
`motion to seal portions of this Order. The motion must include a proposed
`redacted version of the Order, accompanied by an explanation as to why
`good cause exists to maintain under seal each redacted word or phrase. In
`the absence of a motion to seal by the specified deadline, the full version of
`this Order will become public.
`
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`IPR2017-01241 (Patent 7,503,724 B2)
`IPR2017-01242 (Patent 7,918,624 B2)
`
`IV. ORDER
`For the foregoing reasons, it is:
`ORDERED that Patent Owner’s Motions to Disqualify Alan James,
`Ph.D. as Petitioner’s Expert Witness and to Strike Dr. James’ Declaration in
`IPR2016-01241 and IPR2016-01242 are denied;
`FURTHER ORDERED that any motion to seal any portion of this
`Order must be filed within five business days.
`
`
`
`
`
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`IPR2017-01241 (Patent 7,503,724 B2)
`IPR2017-01242 (Patent 7,918,624 B2)
`
`PETITIONER:
`Robert Waddell
`Michael K. Leachman
`JONES WALKER LLP
`rwaddell@joneswalker.com
`mleachman@joneswalker.com
`
`PATENT OWNER:
`
`John F. Triggs
`Ryan D. Levy
`Seth R. Odgen
`William E. Seyki
`PATTERSON INTELLECTUAL PROPERTY LAW, P.C.
`jft@iplawgroup.com
`rdl@iplawgroup.com
`sro@iplawgroup.com
`wes@iplawgroup.com
`
`
`
`
`
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