Eldridge, a provider of industrial and marine ventilation solutions, expects to receive a little over $800,000 in a settlement of patent infringement lawsuit.
The U.S. Court of Appeals for the Federal Circuit in Washington, D.C., denied a request Sept. 30 by Jurong Shipyard Pte., Ltd., subsidiaries of Atwood Oceanics Inc. and Seadrill Limited, and Azen Manufacturing Pte. Ltd, for a rehearing of the patent suit, reaffirming the court’s decision that the defendants had infringed on Eldridge ENJET’s patent.
In November 2013, the U.S. District Court for the Eastern District of Texas ruled in Eldridge’s favor that the defendants had infringed upon their ENJET patent. The same court reaffirmed the ruling in September 2014. The defendants appealed the ruling to a three-judge panel of the U.S. Court of Appeals for the Federal Circuit in Washington, D.C., hoping the appellate court would overturn the previous rulings. The Court of Appeals affirmed July 17 the previous rulings in favor of Eldridge.
Houston-based Eldridge originally filed its lawsuit in November 2011.
ENJET is a technology that addresses a longstanding problem in the offshore drilling industry – that under certain engine load and weather conditions, diesel engine exhaust blows back into the drilling rig, coating the decks and side of the drilling rigs and lifeboats. The exhaust creates adverse working conditions and poses a health hazard to workers. ENJET creates a high velocity exhaust stream to capture and expel noxious gases away from the environments where people and equipment are in close proximity to the exhaust pipes of internal combustion engines. ENJET is installed at the end of existing engine exhaust pipe to supercharge the engine’s exhaust velocity away from the rig and work area.
Drilling contractor GlobalSantaFe Corporation – which merged with drilling contractor Transocean in 2007 – had originally approached Eldridge ENJET about a solution for diesel engine exhaust, said Gary Leseman, president of Eldridge, in an interview with Rigzone. The U.S. Coast Guard had told GlobalSantaFe they couldn’t operate rigs until the exhaust issue was addressed.
Leseman and Joe Davis, vice president of Eldridge ENJET, combined their experiences with fans and engine exhaust to come up with a technology to blow engine exhaust away from a drilling rig. The device was invented in 2005; the company received its U.S. patent for the technology in 2010.
Seadrill took proprietary Eldridge drawnings to Jurong Shipyard, requesting that the devices be installed on rigs. Jurong then gave the drawings to Azen, a Singapore-based company 70 percent owned by Minneapolis, Minn.-based Twin City Fan & Blower, asking if Azen could build a similar device. Azen made copycat devices for Jurong, then started manufacturing them for other shipyards.
The technology has primarily been used on jackups and semisubmersibles. To date, 250 of the engines have been installed on around 35 to 40 rigs, including ones furnished by Eldridge ENJET and copies of their technology.
Leseman estimates that the company has lost revenues of $7 million as a result of the patent infringement.
Eldridge was able to enforce its U.S. patent on the technology once three rigs that had engines that infringed on the patent came into the U.S. Gulf of Mexico. The three rigs were Seadrill’s West Sirius (UDW semisub) and West Capricorn (UDW semisub), and Atwood Oceanics’ Atwood Condor (UDW semisub).
The defendants tried to argue that U.S. patent enforcement did not apply to drilling rigs operating in the U.S. Extended Economic Zone (EEZ) of the U.S. Gulf, which extends out to 200 miles off the U.S. shoreline. The court ruled that the U.S. patent did apply to the rigs working in the EEZ. To the best of Eldridge’s knowledge, this marks the first time the jurisdiction of U.S. patent law has been applied to offshore drilling rigs operating in the EEZ.
Other rigs still have copies of the ENJET technology, but the patent can’t be enforced because those rigs haven’t entered U.S. waters. In September 2014, the judge presiding over the case not only affirmed Eldridge’s patent infringement win over the defendants, but granted Eldridge’s request for a permanent injunction barring Jurong and other defendants from bringing rigs carrying the infringing exhaust system into the U.S. Gulf.
The ruling sets a precedent for other companies because, if technology is installed on a rig that infringes on a U.S. patent, they will not be able to operate in the United States, a company spokesperson said in a statement.
Since its founding in 1946, Eldridge has supplied marine ventilation systems for mobile offshore drilling rigs, and holds seven total patents on equipment items associated with industrial and marine ventilation.
Jurong, Seadrill and Atwood did not respond to Rigzone’s request for comment on the lawsuit.
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