“The Patents relate to the use of CSEM for determining the nature of a subterranean reservoir, i.e. whether the reservoir contains hydrocarbons or water. Prior to EMGS, the prior art surveying method that was commonly used in subsea hydrocarbon exploration was seismic surveying (i.e. using sound waves to detect subterranean structures). However, as the 019 Patent explains, seismic surveying suffers from a serious flaw in that it is not able to distinguish between water and oil filled reservoirs. This meant that if a subterranean reservoir was detected using seismic surveying that was hoped to contain hydrocarbons, it was still necessary to drill a well to determine the nature of the reservoir. The success rate of finding oil in such reservoirs using seismics is stated in the 019 patent at 1 in 10. The 019 Patent puts the associated loss of US$25million for each of the 9 in 10 reservoirs that is drilled and found to contain water. This is a very costly exercise and meant that there was plainly a strong incentive to improve on the prior art seismic techniques.”
“31.8(1) A party’s duty to disclose documents is limited to documents which are or have been in his control. (2) For this purpose a party has or has had a document in his control if – (a) it is or was in his physical possession (b) he has or has had a right to possession of it; or (c) he has or has had a right to inspect or take copies of it.”
“Our client carried out searches of its corporate files at the following facilities in Sugar Land and Houston, Texas”, and it then sets out the addresses of four facilities in Texas. The letter continues: “These facilities house our client’s corporate patent files. No documents were found that are both relevant to the action and not protected by privilege (2) The personal files of the following individuals were also searched: (a) Jeff Griffin (an attorney at Schlumberger WesternGeco); (b) Charlotte Copperthite (an attorney at Schlumberger Ltd.); (c) James Kurka (an attorney at Schlumberger Technology Corp.); and (d) Jim Brady (a technical officer at Schlumberger WesternGeco).”
“Finally, please note that although our client, Schlumberger Holdings Limited, prepared the list having taken into account all documents that may exist in the Schlumberger group and with the cooperation of other group companies in this instance, it does not accept that it was under any obligation to extend disclosure beyond documents in its own custody, power or control, and maintains that this does not extend to group documents as a whole.”
“…. the expression ‘power’ must, in my view, mean a presently enforceable legal right to obtain from whoever actually holds the document inspection of it without the need to obtain the consent of anyone else.”
“For the reasons already indicated Shell Mocambique’s documents are not in my opinion within the ‘power’ of either Shell or BP within the meaning of RSC, Ord. 24. They could only be brought within their power either (1) by their taking steps to alter the articles of association …. or (2) by obtaining the voluntary consent of the board of Shell Mocambique to let them take copies of the documents. It may well be that such consent could be obtained; but Shell and BP are not required by Order 24 to seek it, any more than a natural person is obliged to ask a close relative or anyone else who is a stranger to the suit to provide him with copies of documents in the ownership and possession of that other person, however likely he might be to comply voluntarily with the request if it were made.”
“In general I expect group companies will provide documents requested by the Claimant, except where the documents are especially sensitive or the requests are onerous, but the Claimant has no power to force those companies to comply with its requests. In particular I would not expect group companies to allow a disclosure search of their records for due diligence documents arising in the context of corporate acquisitions because of the extremely commercially sensitive and highly confidential nature of those documents, unless there is a court order binding the company concerned.”
“Schlumberger has been active in the field of searching for undersea oil drilling sites for many years before the priority date of the patents in suit …. According to its website, Schlumberger spends hundreds of millions of dollars per year on research and development. On its website, Schlumberger describes its commitment to research and development and states that it has consistently invested significant time and money on research and development as a long-term strategy ‘to support and grow their technology leadership’. In 2004, for example, Schlumberger states that it invested US$467 million in research and development for their oilfield activities, this represented 5% of revenue. Schlumberger claims that it invests more each year in research and development than all other oilfield services companies combined.”
“1. The Claimant, by [on or before 4.00 pm on [7 February] 2008] do carry out a reasonable and proportionate search for documents falling within the classes described below and disclose any documents located as a result of that search. Categories of Documents 2. Documents that are or have been in the control of those businesses that are in common ownership with the Claimant (including WesternGeco LLC and AOA Geomarine Operations Inc) together, the ‘Schlumberger Group’) and which businesses have been concerned with developing or evaluating methods to identify the nature of sub-sea reservoirs by any means including seismic or electromagnetic methods, being documents coming into existence in the period2 February 1998 to28 July 2005 recording: 2.1 the attempts by the members of the Schlumberger Group named in paragraph 2 above to develop or evaluate methods to identify the nature of sub-sea reservoirs using electromagnetic methods; and 2.2 the reactions of the staff of the members of the Schlumberger Group named in paragraph 2 above to: (a) The Angola Papers: (i) ‘Sea Bed Logging (SBL), a new method for remote and direct identification of hydrocarbon filled layers in deepwater areas’ Eidesmo et al, First Break volume 20.3 March 2002 ; (ii) ‘Remote detection of hydrocarbon filled layers using marine controlled source electromagnetic sounding’ Eidesmo et al, EAGE 64th Conference, Florence, 27-30 May 2002 ;. (iii) ‘Remote sensing of hydrocarbon layers by seabed logging (SBL): Results from a cruise offshore Angola’ Ellingsrud et al, The Leading Edge, October 2002; (b) their participation in the study giving rise to that paper; (c) Publication of the Defendant's inventions in published applications for EP 1256019, EP 1309887 and GB 2399640 (and their equivalents in other jurisdictions). A. Further or alternatively to paragraph 2.1 above and without prejudice to the Defendant’s right to make a further application for documents under that head, the Claimant shall by on or before 4.00 pm on [31 January 2008 ] serve on the Defendant: (i) a schedule setting out in relation to those companies identified in paragraph 2 above, which of those companies did in the period2 February 1998 to28 July 2005 inclusive, use, develop or evaluate any method for carrying out a survey using a CSEM to either (a) search for a hydrocarbon reservoir, or (b) determine the nature of a submarine or subterranean reservoir; and in each case identifying the relevant company and the method concerned. (ii) A schedule identifying all prior products and processes referred to in paragraph 2 of the first statement of Aaron Gatt Floridia made herein on12th July 2007 as being ‘products and processes already well established by the time the patents were filed’, and all documents which will be relied upon at trial as evidencing the same. 3. In relation to the paper ‘Recent and future developments in marine acquisition technology: An unbiased opinion’ by Nick Moldoveanu of Schlumberger, in so far as they relate to the discussion in the final paragraph of page 12: 3.1 drafts of the paper; 3.2 internal communications discussing the comments in the final paragraph of page 12; 3.3 preparatory materials. 4. The following documents relating to Schlumberger Group's acquisition of WesternGeco LLC, and AOA Geomarine Operations Inc and attempted acquisition of the Defendant (together, the ‘Targets’) : (a) documents relating to the assessment of each Target's technology for identifying the nature of sub-sea reservoirs using electromagnetic methods; (b) information memoranda or similar documents prepared by AOA Geomarine Operations Inc or WesternGeco LLC or their respective owners or advisers in connection with their proposed disposal to Schlumberger Group and relating to each of those Targets' technology for identifying the nature of sub-sea reservoirs using electromagnetic methods; and (c) documents relating to the assessment of EMGS' patents and patent applications concerning technology for identifying the nature of sub-sea reservoirs; 5. Documents stating technical reasons relevant to the decision by Arnold Orange Associates to incorporate AOA Geomarine Operations Inc to commercialise controlled source electromagnetic techniques for identifying the nature of sub-sea reservoirs.”
“40. In 2002, one year after taking part in the Norway survey, AOA Geomarine Operations Inc. (‘AGO’) was formed in order to commemorate CSEM. Relevant pages of the AGO website form Exhibit SDB13. I believe that documents generated by AOA and subsequently AGO in relation to the contemporaneous reactions to EMGS’ inventions and AOA’s and AGO’s attempts to solve the problems addressed by the patents in suit would assist in assessing the question of what was obvious to a person skilled in the art at the priority date. I also believe the decision to establish a new company to exploit a particular technology would have generated documents evaluating the technical merits of CSEM technology including whether it was an old and known or a significant new technology. 41. Schlumberger announced its acquisition of AGO at the annual meeting of the Society of Exploration Geophysicists (‘SEG’) on12 October 2004 . A press release detailing the acquisition is attached and marked Exhibit SDB14. AGO is described both in the press release and on the Schlumberger website as ‘a pioneer in CSEM and MMT (marine magnetotelluric) technologies’. As ‘pioneers’ in the CSEM field, I would expect those working at AGO would have been aware of the relevant art and common general knowledge in this field and that they would be considered to be persons skilled in the art. I believe that the documents recording the contemporaneous efforts and reactions of the AGO personnel would be of assistance in assessing the question of obviousness.”
“54. I am informed by Stale Johansen of EMGS that in 2004 Schlumberger was an unsuccessful bidder in the auction by Statoil of EMGS. I am aware from my involvement in bids made by clients of Lovells for other companies that the acquiring company will frequently carry out assessment of a target. 55. I would also expect there to be documents prepared by Schlumberger setting out the rationale for the purchase and commenting on the business need for the technology in question.”