United States Court of Appeals 

for the Federal Circuit 

__________________________ 

TRANSOCEAN OFFSHORE DEEPWATER 

DRILLING, INC., 

Plaintiff-Appellant, 

v. 

MAERSK CONTRACTORS USA, INC., 

Defendant-Appellee. 

__________________________ 

2009-1556 

__________________________ 

Appeal from the United States District Court for the 

Southern District of Texas in case No. 07-CV-2392, Judge 

Kenneth M. Hoyt. 

___________________________ 

Decided: August 18, 2010 

___________________________ 

GREGORY A. CASTANIAS, Jones Day, of Washington, 

DC, argued for plaintiff-appellant. With him on the brief 

was THOMAS J. DAVIS. Of counsel was KARLA R.

GOLDMAN. Of counsel on the brief were CHARLES B.

WALKER, JR., MICHAEL S. MCCOY and WARREN S. HUANG, 

Fulbright & Jaworski L.L.P., of Houston, Texas. 

WILLIAM H. FRANKEL, Brinks Hofer Gilson & Lione, of 

Chicago, Illinois, argued for defendant-appellee. With 

him on the brief were GLEN P. BELVIS, MARK H. REMUS 
TRANSOCEAN v. MAERSK CONTRACTORS 2

and DAVID P. LINDNER. Of counsel on the brief was LEE L.

KAPLAN, Smyser Kaplan & Veselka, L.L.P., of Houston, 

Texas. 

__________________________ 

 Before, GAJARSA, MAYER, and MOORE, Circuit Judges. 

MOORE, Circuit Judge. 

Transocean Offshore Deepwater Drilling, Inc. (Transocean) appeals from a final judgment of the U.S. District 

Court for the Southern District of Texas. The district 

court, on summary judgment, held that the asserted 

claims of the patents-in-suit are invalid, not infringed, 

and that defendant Maersk Contractors USA, Inc. 

(Maersk USA) did not act willfully. For the reasons set 

forth below, we reverse-in-part, vacate-in-part, affirm-inpart, and remand. 

BACKGROUND

Transocean asserted claims 10-13 and 30 of U.S. Patent No. 6,047,781 (’781 patent), claim 17 of U.S. Patent 

No. 6,068,069 (’069 patent), and claim 10 of U.S. Patent 

No. 6,085,851 (’851 patent) against Maersk USA. The 

patents-in-suit share a common specification. The patents 

relate to an improved apparatus for conducting offshore 

drilling. In order to exploit oil and other resources below 

the sea floor, the disclosed rig must lower several components to the seabed including the drill bit, casings (metal 

tubes that create the wall of the borehole), and a blow-out 

preventer (BOP) that sits atop the well to prevent rupture 

during extended drilling. Id. col.8 l.40-col.9 l.30. The 

structure for lowering these elements and rotating the 

drill is called the derrick. Id. col.4 l.66-col.5 l.3. The 

derrick includes a top drive to rotate the drill and drawworks to move components (such as the drill, casing, and 
3 TRANSOCEAN v. MAERSK CONTRACTORS

BOP) to and from the sea floor. Id. col.6 ll.52-61; col.7 

ll.65-67. 

The derrick lowers and raises the drill bit and other 

components on the drill string. The drill string is a series 

of pipe sections, or “joints,” that the rig assembles on the 

surface. To begin the drilling process, the rig lowers the 

drill bit into the water toward the sea floor, adding more 

and more pipe sections or “joints” to the top of the drill 

string. For example, if the joints are each 30’ long, the 

drawworks would lower the drill 30’ and then pause to 

attach a new 30’ joint of pipe before proceeding. Once the 

drill reaches the seabed, the top drive turns the drill 

string to create the borehole. Again, when the drill bit 

moves 30’ into the seabed, the rig must add a new joint of 

pipe at the surface in order to continue drilling. Once the 

drill bit creates a portion of the borehole, the derrick 

retracts it to the surface. This means that the rig must 

remove each joint of pipe it added during the drill’s descent. This is a time-consuming process. 

Once the drill bit is back on the surface, the derrick 

lowers a casing on another drill string, adding joints of 

pipe in the same manner. The casing is a metal tube that 

creates the wall of the borehole. Once the casing is in 

place, cement is pumped down through the drill string 

through and around the casing to hold it in place; the rig 

then retracts the drill string. This casing forms the first 

section of the borehole; the rig must drill through this 

casing to greater depth to reach the oil reservoir. Before 

the next round of drilling, the rig lowers a BOP on a large 

diameter drill string called a riser. The BOP prevents oil 

and gas from escaping from the borehole. The rig then 

drills through the riser, BOP, and first casing to create a 

new portion of the borehole that is smaller in diameter 

than the first portion. The casing process occurs for this 

new section and this entire process continues until the 
TRANSOCEAN v. MAERSK CONTRACTORS 4

borehole resembles a telescope of several sections of 

decreasing diameter. 

A conventional rig utilized a derrick with a single top 

drive and drawworks. Because it could only lower one 

element at a time, the rig performed the many steps 

involved in drilling a well in series. Transocean attempted to improve the efficiency of this time-consuming 

process with the system described in the patents-in-suit. 

The patents describe a derrick that includes two stations—a main advancing station and an auxiliary advancing station—that can each assemble drill strings and 

lower components to the seabed. ’781 patent fig.2; col.3 

ll.58-66. Each advancing station includes a top drive for 

rotating the drill string and drawworks for raising and 

lowering the drill string. The auxiliary advancing station 

performs the initial drilling and casing. Id. col.9 l.66-

col.10 l.2. While the auxiliary advancing station cases the 

first portion of the borehole, the main advancing station 

lowers the BOP. Id. col.9 ll.21-23. Once the casing is 

complete, the auxiliary advancing station retracts the 

drill string and begins supporting the main advancing 

station by preparing lengths of the drill string in advance. 

See id. col.9 ll.25-30. For example, the auxiliary advancing station may take three or four joints of pipe, assemble 

them, and set them aside so that while the main advancing station is lowering a drill bit or casing, it does not 

have to connect every joint. Id. While the auxiliary 

advancing station is performing this function, the main 

advancing station is drilling and casing additional portions of the well. Id. col.9 ll.35-40. This “dual-activity” rig 

can significantly decrease the time required to complete a 

borehole. Id. col.11 ll.56-67. 

Transocean appeals the district court’s grant of summary judgment of (1) invalidity of all asserted claims 

based on obviousness and lack of enablement, (2) nonin-
5 TRANSOCEAN v. MAERSK CONTRACTORS

fringement, and (3) no willfulness. We have jurisdiction 

under 28 U.S.C. § 1295(a)(1). 

DISCUSSION

We review a district court’s grant of summary judgment de novo. ICU Med., Inc. v. Alaris Med. Sys. Inc., 558 

F.3d 1368, 1374 (Fed. Cir. 2009). Summary judgment is 

appropriate when, drawing all justifiable inferences in the 

nonmovant’s favor, there exists no genuine issue of material fact and the movant is entitled to judgment as a 

matter of law. Fed. R. Civ. P. 56(c); Anderson v. Liberty 

Lobby, Inc., 477 U.S. 242, 255 (1986). 

I. Invalidity 

The district court held that all asserted claims are invalid. Claim 17 of the ’069 patent is an example of the 

independent claims at issue: 

A multi-activity drilling assembly operable to be 

supported from a position above the surface of a 

body of water for conducting drilling operations to 

the seabed and into the bed of the body of water, 

said multi-activity drilling assembly including: 

a drilling superstructure operable to be 

mounted upon a drilling deck for simultaneously supporting drilling operations for 

a well and operations auxiliary to drilling 

operations for the well; 

a first tubular advancing station connected to said drilling superstructure for 

advancing tubular members to the seabed 

and into the bed of body of water; 

a second tubular advancing station connected to said drilling superstructure for 
TRANSOCEAN v. MAERSK CONTRACTORS 6

advancing tubular members simultaneously with said first tubular advancing 

station to the seabed and into the body of 

water to the seabed; and 

an assembly positioned adjacent to said 

first and second tubular advancing stations operable to transfer tubular assemblies between said first tubular advancing 

station and said second tubular advancing 

station to facilitate simultaneous drilling 

operations auxiliary to said drilling operations, wherein drilling activity can be conducted for the well from said drilling 

superstructure by said first or second tubular advancing stations and auxiliary 

drilling activity can be simultaneously 

conducted for the well from said drilling 

superstructure by the other of said first or 

second tubular advancing stations. 

The district court found the claims obvious under 35 

U.S.C. § 103(a) and not enabled under 35 U.S.C. 

§ 112 ¶ 1. 

A. Obviousness 

A patent shall not issue “if the differences between 

the subject matter sought to be patented and the prior art 

are such that the subject matter would have been obvious 

at the time the invention was made to a person having 

ordinary skill in the art to which said subject matter 

pertains.” 35 U.S.C. § 103(a); see KSR Int’l Co. v. Teleflex 

Inc., 550 U.S. 398, 406-07 (2007). Obviousness is a question of law with underlying fact issues. Id. at 427; Dennison Mfg. Co. v. Panduit Corp., 475 U.S. 809, 811 (1986). 

What a particular reference discloses is a question of fact, 
7 TRANSOCEAN v. MAERSK CONTRACTORS

see Para-Ordnance Manufacturing, Inc. v. SGS Imports 

International, Inc., 73 F.3d 1085, 1088 (Fed. Cir. 1995), as 

is the question of whether there was a reason to combine 

certain references, see McGinley v. Franklin Sports, Inc., 

262 F.3d 1339, 1352 (Fed. Cir. 2001). Under the four part 

test for obviousness detailed in Graham v. John Deere Co. 

of Kansas City, 383 U.S. 1, 17-18 (1966), the court must 

consider (1) the scope and content of the prior art; (2) the 

difference between the prior art and the claimed invention; (3) the level of ordinary skill in the art; and (4) any 

objective evidence of nonobviousness. The objective 

evidence relevant to this appeal includes industry skepticism, long-felt industry need, commercial success, and 

copying. See Agrizap, Inc. v. Woodstream Corp., 520 F.3d 

1337, 1344 (Fed. Cir. 2008); Iron Grip Barbell Co. v. USA 

Sports, Inc., 392 F.3d 1317, 1324 (Fed. Cir. 2005). 

Relevant to this appeal, the asserted claims generally 

require (1) a first advancing station capable of advancing 

tubular members to the seabed, (2) a second advancing 

station also capable of advancing tubular members to the 

seabed, and (3) a transfer assembly to move tubular 

members between the first advancing station and the 

second advancing station. 

The district court held that the claims would have 

been obvious over two references: U.K. patent application 

GB 2 041 836 to Horn (Horn) and U.S. Patent No. 

4,850,439 to Lund (Lund). The parties did not dispute the 

teachings of the references below. The district court noted 

that Horn discloses a single derrick that supports two 

advancing stations that each advance tubular members to 

the seabed, but fails to disclose a transfer assembly that 

will move tubular members between them. The district 

court then noted that Lund discloses this missing element. The court pointed to the transfer mechanism of 

Lund that transfers pre-assembled pipe sections from a 
TRANSOCEAN v. MAERSK CONTRACTORS 8

preparation station to an advancing station. The court 

held that based on the undisputed teachings of these 

references, the asserted claims would have been obvious 

to one of ordinary skill in the art. 

Transocean argues on appeal that the combination of 

Horn and Lund would not result in the claimed invention, 

but in a rig with two advancing stations, two preparation 

stations, and two transfer assemblies. Transocean also 

argues that the claims would not have been obvious over 

any combination with Horn because the claimed invention 

must operate on a single well and Horn only discloses two 

advancing stations operating on two wells. 

We agree that Horn and Lund establish a prima facie

case that the claims would have been obvious. In combination, Horn and Lund teach all of the limitations of the 

claims, two advancing stations that can advance tubular 

members to the seabed as well as a transfer assembly to 

move tubular members between the stations. But it is 

not enough to simply show that the references disclose the 

claim limitations; in addition, “it can be important to 

identify a reason that would have prompted a person of 

ordinary skill in the art to combine the elements as the 

new invention does.” KSR, 550 U.S. at 401. In this case, 

the reason to combine comes directly from the Horn 

reference. Discussing the benefits of combining two 

advancing stations in a single derrick, Horn states “[o]f 

other obvious advantages, there is the possibility of 

concentrating common auxiliary equipment . . . .” Horn 

p.1 ll.119-21. The transfer assembly of Lund is just the 

type of “auxiliary” equipment that one could concentrate 

for two advancing stations under a single derrick.1 We 

 1 Though it is not clear what the district court intended when it stated: “[t]o be an invention, the combining of the timesavings element [sic] would need to be 
9 TRANSOCEAN v. MAERSK CONTRACTORS

hold that the teachings of the references as well as this 

reason to combine support a prima facie case that the 

claims would have been obvious to one of ordinary skill in 

the art. 

Transocean’s first argument that the combination 

would result in two advancing stations, two preparation 

stations, and two transfer assemblies asks us to improperly turn the person of ordinary skill in the art into an 

“automaton” that can only add pieces of prior art. See

KSR, 550 U.S. at 421. Transocean’s second argument 

that Horn cannot render these claims obvious in any 

combination is similarly unavailing. Horn and Lund in 

combination, not individually, support the prima facie

case. It would have been obvious to one of ordinary skill 

in the art that the dual well system of Horn could be 

combined with the single well system of Lund to result in 

two advancing stations operating on a single well with a 

transfer assembly moving tubular members between 

them. 

Although we hold that Horn in view of Lund present a 

prima facie case of obviousness, this is not the end of the 

analysis. At the district court, Transocean presented 

significant objective evidence of nonobviousness. First, 

Transocean presented evidence of industry skepticism. A 

Transocean competitor, in an article discussing simultaneous drilling operations, stated that dual drill strings 

would be a “radical departure” from conventional systems 

 

expressed in a manner that distinguishes, mathematically 

or scientifically, the time saved by comparing a Transocean rig from the time saved using other rigs that also 

claim timesaving features,” we note that the focus must 

be on whether the claimed invention would have been 

obvious to one of skill in the art, not whether it is an 

improvement over the prior art. Ryco, Inc. v. Ag-Bag 

Corp., 857 F.2d 1418, 1424 (Fed. Cir. 1988). 
TRANSOCEAN v. MAERSK CONTRACTORS 10

and that there was a high potential for underwater collision. Others in the field described dual activity as “not 

being realistic” for the same reasons. Second, Transocean 

presented evidence of industry praise for its dual activity 

rig. An industry publication called the invention one of 

the top 50 innovations in offshore drilling history. Transocean also cites other examples of praise from clients and 

competitors, including Maersk USA. Third, Transocean 

presented evidence that its implementation of the dual 

activity invention has been a commercial success. It 

showed that its dual activity rigs command a higher 

licensing premium than standard rigs. Finally, Transocean presented evidence that the success of its invention 

caused others to copy it, including Maersk USA. 

Maersk USA disputes each of these pieces of evidence 

arguing that they do not have a nexus to the claimed 

invention. Regarding industry skepticism, Maersk USA 

points to several prior art references that described dual 

side-by-side drill strings with no concern for collision. On 

industry praise, Maersk USA argues that the relevant 

articles and statements refer to the entire rig, not to the 

dual activity of the invention specifically. On commercial 

success, Maersk USA argues that Transocean negotiated 

its licenses under threat of litigation and the terms are 

not relevant. Finally, Maersk USA argues that there is 

no evidence that any party copied the claimed invention, 

only that others intended to implement some sort of dual 

drilling system. 

In its opinion, the district court ignored this objective 

evidence of nonobviousness. Though the court cites 

Graham, it indicates that the court is required to consider 

only the first three factors. Transocean Offshore Deepwater Drilling, Inc. v. Maersk Contractors USA, No. 07-2392, 

D.I. 148, *16 (S.D. Tex. July 28, 2009) (Noninfringement/Invalidity Order). Transocean argues that this is 
11 TRANSOCEAN v. MAERSK CONTRACTORS

reversible error asserting that a district court must consider objective evidence of nonobviousness when a party 

presents it. Maersk USA responds that we have considered this type of evidence for the first time on appeal in 

prior cases and should do so here. 

We hold that the district court erred by failing to consider Transocean’s objective evidence of nonobviousness. 

Our case law is clear that this type of evidence “must be 

considered in evaluating the obviousness of a claimed 

invention.” Iron Grip, 392 F.3d at 1323; Ruiz v. A.B. 

Chance Co., 234 F.3d 654, 667 (Fed. Cir. 2000); Richardson-Vicks, Inc. v. Upjohn Co., 122 F.3d 1476, 1483 (Fed. 

Cir. 1997). While it is true that we have held in individual cases that objective evidence of nonobviousness did 

not overcome the strong prima facie case – this is a caseby-case determination. See Leapfrog Enters., Inc. v. 

Fisher-Price, Inc., 485 F.3d 1157, 1162 (Fed. Cir. 2007); 

Agrizap, 520 F.3d at 1344. To be clear, a district court 

must always consider any objective evidence of nonobviousness presented in a case. Iron Grip, 392 F.3d at 1323; 

Ruiz, 234 F.3d at 667; Richardson-Vicks, 122 F.3d at 

1483. 

Maersk USA is correct that in at least one instance, 

we considered this type of objective evidence for the first 

time on appeal and held that the failure to consider it 

below was not reversible error. See Iron Grip, 392 F.3d at 

1324. But in the context of summary judgment, this is 

only proper if, drawing all justifiable inferences in favor of 

the patent owner, the objective evidence cannot rebut the 

prima facie case. We decline to make that holding in this 

case. If all of the factual disputes regarding the objective 

evidence resolve in favor of Transocean, it has presented a 

strong basis for rebutting the prima facie case. Viewing 

the objective evidence of nonobviousness in a light most 
TRANSOCEAN v. MAERSK CONTRACTORS 12

favorable to Transocean, we cannot hold that the claims 

would have been obvious as a matter of law. 

Because of the failure to consider the objective evidence of nonobviousness and because there are genuine 

issues of material fact remaining, we reverse the grant of 

summary judgment of invalidity based on obviousness. 

B. Enablement 

Whether a claim satisfies the enablement requirement is a question of law that we review de novo. Sitrick 

v. Dreamworks, LLC, 516 F.3d 993, 999 (Fed. Cir. 2008). 

A patent specification must “contain a written description 

of the invention . . . to enable any person skilled in the 

art . . . to make and use the same.” 35 U.S.C. § 112, ¶1. 

The specification must “enable one of ordinary skill in the 

art to practice the claimed invention without undue 

experimentation.” Nat’l Recovery Techs., Inc. v. Magnetic 

Separation Sys., Inc., 166 F.3d 1190, 1196 (Fed. Cir. 

1999). Enablement under § 112 is a question of law with 

underlying questions of fact regarding undue experimentation. Liebel-Flarsheim Co. v. Medrad, Inc., 481 F.3d 

1371, 1377 (Fed. Cir. 2007); CFMT, Inc. v. Yieldup Int’l 

Corp., 349 F.3d 1333, 1338 (Fed Cir. 2003). 

On summary judgment, the district court held that 

the asserted claims did not satisfy the enablement requirement because the specification does not include 

sufficient description of the “assembly . . . operable to 

transfer tubular assemblies” or “means . . . for transferring tubular assemblies.” It determined that one of 

ordinary skill in the art could not practice the invention 

without undue experimentation. Noninfringement/Invalidity Order at *9. It relied on evidence regarding Transocean’s difficulty in building its first commercial 

embodiment of the claimed invention holding that “the 
13 TRANSOCEAN v. MAERSK CONTRACTORS

specifications fail to inform as to how this new arrangement works such that a person skilled in the art may take 

advantage of the objective of the invention – timesaving.” 

Id. The district court specifically faulted Transocean’s 

failure to include the “programming” of the transport 

mechanism and any required modifications to prior art 

transfer mechanisms in the specification. Noninfringement/Invalidity Order at *10. 

Transocean argues that the court erred because there 

is a genuine issue of material fact regarding undue experimentation. Transocean first argues that the state of 

the prior art is relevant to enablement and affects the 

level of experimentation that we will consider undue. See

In re Wands, 858 F.2d 731, 736-37 (Fed. Cir. 1988). It 

argues that pipe transferring equipment was well-known 

prior to filing the patent application as evidenced by 

Maersk USA’s own expert, George Boyadjieff.2 Mr. 

Boyadjieff admitted that it would not be “complex,” nor 

would it “take a lot of time” or “engineering effort” to alter 

a prior art transfer assembly to transfer between two 

advancing stations, as claimed, rather than an advancing 

station and a storage area. J.A. 4897. Mr. Boyadjieff 

agreed that it would be “trivial.” Id. Transocean argues 

that this shows that rail-mounted transport was wellknown in the art and this should have precluded summary judgment of nonenablement. 

Transocean also argues that the district court erred 

by requiring it to enable a commercial embodiment rather 

than the claimed invention. CFMT, Inc., 349 F.3d at 

 2 Mr. Boyadjieff testified in reference to his own 

patent that disclosed a rail-mounted transfer assembly 

between an advancing station and a storage area. Mr. 

Boyadjieff is the former CEO of Varco International, Inc., 

the company that designed the pipe handling system for 

Transocean’s own implementation of the patented system. 
TRANSOCEAN v. MAERSK CONTRACTORS 14

1338. It claims that 35 U.S.C. § 112 only requires that it 

enable “any mode of making and using the claimed invention.” Engel Indus., Inc. v. Lockformer Co., 946 F.2d 1528, 

1533 (Fed. Cir. 1991). 

Maersk USA argues that the district court is correct 

and that the invention is not enabled because it would 

require one of ordinary skill in the art to engage in undue 

experimentation to practice the invention as a matter of 

law. Nat’l Recovery Techs., 166 F.3d at 1196. Maersk 

USA relies heavily on Transocean’s attempts to build the 

first commercial embodiment of the claimed invention. 

Maersk USA argues that Transocean contracted with 

Varco International, Inc. (Varco) to build this embodiment 

because the inventors did not know how to construct the 

transferring equipment. Maersk USA points to inventor 

testimony that the embodiment included “software they 

had never done before,” and open issues such as “the 

weight it could handle,” “the speed it could travel,” “the 

hoisting range we needed,” “the size of the tubular it could 

handle,” and “the capability to rotate without friction.” 

J.A. 3999. 

We agree with Transocean that factual issues regarding undue experimentation remain in this case that 

preclude summary judgment of no enablement. As an 

initial matter, the district court erred in requiring Transocean to enable the invention to allow a person of ordinary skill in the art to take advantage of the “timesaving” 

aspect of the invention. A patent specification only must 

enable one of ordinary skill in the art “to practice the 

claimed invention without undue experimentation.” Nat’l 

Recovery Techs., 166 F.3d at 1196. It is not required to 

enable the most optimized configuration, unless this is an 

explicit part of the claims. In the present case, transferring tubular members from one location to another may 

be enabled by simply disclosing the use of a crane or a 
15 TRANSOCEAN v. MAERSK CONTRACTORS

rail-mounted system. It is irrelevant whether the enabling disclosure would provide the most efficient transfer. 

In requiring disclosure of “programming” and relying on 

the difficulty of constructing Transocean’s first dual 

activity rig, the district court erroneously required Transocean to enable the most efficient commercial embodiment, rather than the claims. CFMT, Inc., 349 F.3d at 

1338. 

The court also erred in its determination that there is 

no genuine issue of material fact regarding undue experimentation. The parties do not dispute that the specification discloses two different types of transfer 

mechanism: a rail-mounted system and a crane. ’781 

patent, col.7 ll.21-26, 53-55; fig.7. But the parties heavily 

dispute whether the development of the transfer equipment would be “trivial,” or a much more complex task 

based on the evidence presented below. Drawing all 

justifiable inferences in favor of Transocean, we cannot 

agree with the district court that these claims are not 

enabled as a matter of law. Therefore, we reverse the 

grant of summary judgment. 

II. Infringement 

The infringement issues in this case are unusual and 

require a discussion of the factual background. Transocean accused Maersk USA’s DSS-21 rig of infringement. 

Maersk USA’s Danish parent company, Maersk A/S, 

contracted with Keppel FELS Ltd. in 2005 to build the 

accused rig in Singapore. Later, Maersk A/S negotiated 

with Statoil ASA (a Norwegian company) for Statoil’s use 

of the accused rig. The companies came to an agreement 

for use of the rig and Maersk USA and Statoil Gulf of 

Mexico LLC (Statoil), a Texas Corporation, signed a 

contract in Norway. The contract specified that the 

“Operating Area” for the rig was the U.S. Gulf of Mexico 
TRANSOCEAN v. MAERSK CONTRACTORS 16

but that Statoil had the right to use the rig outside the 

Operating Area with certain limitations. J.A. 7167; 7211. 

The contract also included mention of Transocean’s 

U.S. patents. Maersk USA specifically retained the right 

to make “alterations” to the accused rig “in view of court 

or administrative determinations throughout the world.” 

J.A. 7190. One of these “determinations” came when 

Transocean asserted the same patent claims in this case 

against another competitor, GlobalSantaFe Corp. (GSF). 

Transocean prevailed in that case and the court issued an 

injunction requiring GSF to install a “casing sleeve” on 

one of its two advancing stations. Transocean Offshore 

Deepwater Drilling, Inc. v. GlobalSantaFe Corp., No. H03-2910, 2006 U.S. Dist. LEXIS 93408 (S.D. Tex. Dec. 27, 

2006). This casing sleeve prevents the auxiliary advancing station from lowering a drill string into the water. Id.

at *32-34. The district court in GSF held that this avoids 

infringement because the cased advancing station can no 

longer advance tubes to the seabed as the independent 

claims require. Before delivering the rig to the U.S., 

Maersk USA learned of the injunction against GSF and 

modified the accused rig with the same casing sleeve to 

prevent one of the stations from advancing pipes to the 

seabed. 

The district court granted summary judgment of noninfringement after determining that there was no sale or 

offer to sell under 35 U.S.C. § 271(a).3 Transocean Offshore Deepwater Drilling, Inc. v. Maersk Contractors USA, 

 3 The district court addressed infringement in two 

orders. First, it determined that the contract between 

Maersk USA and Statoil was not a sale or offer to sell 

under § 271(a) in its order granting summary judgment of 

no willfulness entered May 15, 2009. It resolved all 

remaining infringement issues in an order entered July 

28, 2009. 
17 TRANSOCEAN v. MAERSK CONTRACTORS

No. 07-2392, D.I. 148, *8-9 (S.D. Tex. May 15, 2009) 

(Willfulness Order). The court relied on the undisputed 

facts that the negotiation and signing of the contract took 

place outside the U.S. and that the contract gave Maersk 

the option to alter the rig to avoid infringement. Id. The 

district court also held that Transocean was collaterally 

estopped from arguing that the modified rig that Maersk 

USA delivered to Statoil (that included the casing sleeve 

to prevent advancing tubular members to the seabed) 

infringed the patent claims because this design was 

adjudicated as noninfringing in the GSF litigation. 

Noninfringement/Invalidity Order at *12. 

A. Offer to Sell 

Section 271(a) defines infringing conduct: “whoever 

without authority makes, uses, offers to sell, or sells any 

patented invention, within the United States. . . infringes 

the patent.” 35 U.S.C. § 271(a). An offer to sell is a 

distinct act of infringement separate from an actual sale. 

An offer to sell differs from a sale in that an offer to sell 

need not be accepted to constitute an act of infringement. 

See MEMC Elec. Materials, Inc. v. Mitsubishi Materials 

Silicon Corp., 420 F.3d 1369, 1376 (Fed. Cir. 2005). 

Moreover, the damages that would flow from an unaccepted offer to sell and an actual sale would likely be 

quite different. See Timothy R. Holbrook, Liability for the 

“Threat of Sale”: Assessing Patent Infringement for Offering to Sell an Invention and Implications for the On-Sale 

Patentability Bar and other Forms of Infringement, 43 

Santa Clara L. Rev. 751, 791-92 (2003). We analyze an 

offer to sell under § 271(a) using traditional contract 

principles. Rotec Indus., Inc. v. Mitsubishi Corp., 215 

F.3d 1246 (Fed. Cir. 2000). There is no dispute that there 

was an offer to sell in this case, but Maersk USA argues 
TRANSOCEAN v. MAERSK CONTRACTORS 18

that the offer was made in Norway, not the United States, 

thereby absolving it of § 271(a) liability. 

Maersk A/S (a Danish company) and Statoil ASA (a 

Norwegian company) negotiated the contract that is the 

subject of this alleged offer to sell. Their U.S. affiliates, 

Maersk USA and Statoil executed the contract in Norway. 

The contract included an “Operating Area” of the U.S. 

Gulf of Mexico. The district court held that because the 

negotiations and execution took place outside the U.S., 

this could not be an offer to sell within the United States 

under § 271(a). 

Transocean argues that to hold that this contract between two U.S. companies for performance in the U.S. is 

not an offer to sell within the U.S. simply because the 

contract was negotiated and executed abroad would be 

inconsistent with Lightcubes, LLC v. Northern Light 

Products, Inc., 523 F.3d 1353 (Fed. Cir. 2008) (holding 

that a foreign company cannot avoid liability for a sale by 

delivering the product outside the U.S. to a U.S. customer 

for importation). Transocean argues that a contract 

between two U.S. companies for delivery or performance 

in the U.S. must be an offer to sell within the United 

States under § 271(a). 

Maersk USA argues that Rotec, 215 F.3d 1246 and 

MEMC, 420 F.3d 1369 require that, for there to be an 

offer to sell within the U.S., the offer activities must occur 

within the U.S. It argues that the negotiations and 

execution outside the U.S. preclude offer to sell liability in 

this case. 

This case presents the question whether an offer 

which is made in Norway by a U.S. company to a U.S. 

company to sell a product within the U.S., for delivery 

and use within the U.S. constitutes an offer to sell within 

the U.S. under § 271(a). We conclude that it does. Sec-
19 TRANSOCEAN v. MAERSK CONTRACTORS

tion 271(a) states that “whoever . . . offers to sell . . . 

within the United States any patented invention . . . 

infringes.” In order for an offer to sell to constitute infringement, the offer must be to sell a patented invention 

within the United States. The focus should not be on the 

location of the offer, but rather the location of the future 

sale that would occur pursuant to the offer. 

The offer to sell liability was added to the patent statute to conform to the April 1994 Uruguay Round’s TradeRelated Aspects of Intellectual Property Agreement 

(TRIPS). The underlying purpose of holding someone who 

offers to sell liable for infringement is to prevent “generating interest in a potential infringing product to the commercial detriment of the rightful patentee.” 3D Sys., Inc. 

v. Aarotech Labs., Inc., 160 F.3d 1373, 1379 (Fed. Cir. 

1998). The offer must be for a potentially infringing 

article. Id. We are mindful of the presumption against 

extraterritoriality. Microsoft Corp. v. AT&T Corp., 550 

U.S. 437, 441 (2007). “It is the general rule under United 

States patent law that no infringement occurs when a 

patented product is made and sold in another country.” 

Id. This presumption has guided other courts to conclude 

that the contemplated sale would occur within the United 

States in order for an offer to sell to constitute infringement. See, e.g., Semiconductor Energy Lab. Co. v. Chi Mei 

Optoelectronics Corp., 531 F. Supp. 2d 1084, 1110-11 

(N.D. Cal. 2007). We agree that the location of the contemplated sale controls whether there is an offer to sell 

within the United States. 

The statute precludes “offers to sell . . . within the 

United States.” To adopt Maersk USA’s position would 

have us read the statute as “offers made within the 

United States to sell” or “offers made within the United 

States to sell within the United States.” First, this is not 

the statutory language. Second, this interpretation would 
TRANSOCEAN v. MAERSK CONTRACTORS 20

exalt form over substance by allowing a U.S. company to 

travel abroad to make offers to sell back into the U.S. 

without any liability for infringement. See 3D Sys., 160 

F.3d at 1379. This company would generate interest in its 

product in the U.S. to the detriment of the U.S. patent 

owner, the type of harm that offer to sell within the U.S. 

liability is meant to remedy. Id. These acts create a real 

harm in the U.S. to a U.S. patentee. 

Neither Rotec nor MEMC preclude our determination 

that an offer by a U.S. company to sell a patented invention to another U.S. company for delivery and use in the 

U.S. constitutes an offer to sell within the U.S. First, 

SEB S.A. v. Montgomery Ward & Co., 594 F.3d 1360, 1375 

(Fed. Cir. 2010) contemplated whether the territorial 

reach of the offer to sell language had been decided by 

Rotec and concluded that it had not. The defendants in 

Rotec did argue that because the offer was made in China, 

not the U.S., they did not infringe. Rotec, 215 F.3d at 

1251. And the Rotec court discussed the evidence regarding meetings and communications made in the United 

States. Id. at 1255. The Rotec court held that there was 

no offer to sell, not because of the location of the offer or of 

the ultimate sale, but rather because there was no evidence that an offer was communicated or conveyed by the 

defendants. Id. at 1255 (“None of this evidence, however, 

establishes any communication by Defendants with any 

third party.”). In concurrence, Judge Newman indicates 

that she would have instead decided the case on the 

ground that there was no offer which contemplated a sale 

within the U.S. Id. at 1259 (Newman, J., concurring). 

The MEMC case is even further attenuated as it did not 

even consider location of the offer or the contemplated 

sale, but instead held there was no offer to sell because 

the emails at issue, which contained only technical data 

and no price terms, cannot constitute an offer that could 
21 TRANSOCEAN v. MAERSK CONTRACTORS

be made into a binding contract by acceptance. 420 F.3d 

at 1376. 

We conclude that neither Rotec nor MEMC control 

this case. We hold that the district court erred because a 

contract between two U.S. companies for performance in 

the U.S. may constitute an offer to sell within the U.S. 

under § 271(a). The fact that the offer was negotiated or a 

contract signed while the two U.S. companies were abroad 

does not remove this case from statutory liability. We 

therefore vacate the district court’s summary judgment of 

noninfringement.4 

B. Sale 

The parties begin with the same territoriality argument presented in the context of an offer to sell. Transocean argues that a contract between two U.S. companies 

for performance in the U.S. constitutes a sale under 

§ 271(a). Maersk USA responds that this cannot be a sale 

within the U.S. because all negotiations and execution of 

the contract took place in Norway and the contract did not 

provide for performance only in the U.S. 

 4 We note that because the district court held that 

the location of the offer in this case removed it from the 

statute as a matter of law, it never reached the factual 

issue of whether the subject of the offer to sell was of a 

“patented invention” by analyzing the design of the rig. 

Of course, in this analysis, the district court must determine what was offered for sale, not what was ultimately 

delivered. See Holbrook, supra, at 753. In other words, it 

does not affect this analysis that Maersk USA eventually 

altered the design prior to delivery; the subject of the offer 

to sell was the unmodified rig. The district court must 

determine whether this unmodified rig was “the patented 

invention.” We decline to perform this analysis in the 

first instance on appeal. 
TRANSOCEAN v. MAERSK CONTRACTORS 22

The parties further dispute whether the device that 

was sold was “the patented invention.” Transocean 

argues that we should analyze infringement based on the 

schematics that accompanied the contract. Maersk USA 

argues that this was not an infringing sale because it 

reserved the right to alter the rig to avoid infringement. 

Finally, Maersk USA argues this cannot be a sale under 

§ 271(a) because the rig was not complete at the time of 

contracting. It argues that “in order for there to have 

been a sale within the meaning of 35 U.S.C. § 271(a), the 

entire apparatus must have been constructed and ready 

for use,” citing Ecodyne Corp. v. Croll-Reynolds Engineering, 491 F. Supp. 194, 197 (D. Conn. 1979). 

As with the offer to sell, we hold that a contract between two U.S. companies for the sale of the patented 

invention with delivery and performance in the U.S. 

constitutes a sale under § 271(a) as a matter of law. 

Maersk USA’s first argument, that the location of negotiation and contracting should control is contrary to our 

precedent in Lightcubes. There, we held that a sale does 

not only occur at a “single point where some legally operative act took place.” Lightcubes, 523 F.3d at 1369-70. We 

may also consider other factors such as the place of performance. Id. at 1371. Maersk USA’s argument that 

Statoil could use the rig outside the U.S. ignores the plain 

language of the contract, which includes an “Operating 

Area” of the U.S. Gulf of Mexico. J.A. 7167. It also ignores the fact that Maersk did in fact deliver the rig to 

U.S. waters. Maersk USA’s remaining arguments regarding the right to alter the final design and the fact that the 

rig was not complete at the time of contracting do not 

change the result. Maersk USA and Statoil signed a 

contract and the schematics that accompanied that contract could support a finding that the sale was of an 

infringing article under § 271(a). The fact that Maersk 
23 TRANSOCEAN v. MAERSK CONTRACTORS

USA, after the execution of the contract, altered the rig in 

response to the GSF injunction is irrelevant to this infringement analysis. The potentially infringing article is 

the rig sold in the contract, not the altered rig that 

Maersk USA delivered to the U.S. 

Finally, we reject Maersk USA’s claim that the entire 

apparatus must have been constructed and ready for use 

in order to have been sold. Our precedent establishes 

that a contract can constitute a sale to trigger infringement liability. See NTP, Inc. v. Research in Motion, Ltd., 

418 F.3d 1282, 1319 (Fed. Cir. 2005). A “sale” is not 

limited to the transfer of tangible property; a sale may 

also be the agreement by which such a transfer takes 

place. Id. In this case, there was a contract to sell a rig 

that included schematics. On summary judgment, we 

must draw all justifiable inferences in favor of the nonmovant, Transocean. Transocean argues that these 

schematics show sale of the patented invention. This is a 

genuine issue of material fact sufficient to withstand 

summary judgment. 

We conclude that the district court erred in granting 

summary judgment that there was no sale within the U.S. 

in this case. As with the offer to sell, there remains a 

dispute over whether the unmodified rig that was sold 

was the patented invention, a question not reached by the 

district court thus far. 

C. Collateral Estoppel 

We analyze collateral estoppel under the law of the 

regional circuit. Applied Med. Res., Corp. v. U.S. Surgical 

Corp., 435 F.3d 1356, 1359-60 (Fed. Cir. 2006). To apply 

collateral estoppel to an issue, it must 1) be identical in 

the two actions, 2) have been actually litigated in the 

prior action, and 3) have been necessary to the judgment 
TRANSOCEAN v. MAERSK CONTRACTORS 24

in the prior action. Next Level Commc’ns LP v. DSC 

Commc’ns Corp., 179 F.3d 244, 250 (5th Cir. 1999). The 

parties only dispute the first element, that the two issues 

are identical in the two actions. 

Transocean argues that the issues are not identical in 

this case and the GSF litigation because there are differences in the facts and the legal standards. It argues that 

there is a factual distinction between the cases because 

Maersk USA is not implementing all parts of the injunction. Specifically, while Maersk USA installed the casing 

sleeve that the GSF court found to avoid infringement, it 

refuses to abide by other requirements of the injunction 

such as the limited circumstances in which GSF could 

remove the casing sleeve and periodic reporting to Transocean regarding the use of the rig. Transocean also 

argues that the legal standards are different in an injunction determination and a determination of infringement. 

Maersk USA responds that these differences are irrelevant because they do not relate to the holding by the 

GSF court that the modified rig does not infringe. It 

argues that the only facts relevant to collateral estoppel 

in this case relate to the GSF court’s holding on infringement. Specifically, the court in the GSF litigation held 

that this modification avoids infringement. Transocean 

Offshore Deepwater Drilling, Inc., 2006 U.S. Dist. LEXIS 

93408, at *34. Maersk USA argues that this is the identical issue in this case and that Transocean cannot now 

argue that this modified design infringes. 

We agree with Maersk USA that the infringement issue in this case is identical to the one in GSF. Although 

Transocean is correct that Maersk USA does not conform 

to all aspects of the injunction, it does conform to the only 

relevant condition, the noninfringing design. The other 

portions of the injunction do not relate to infringement 
25 TRANSOCEAN v. MAERSK CONTRACTORS

and do not change the fact that the modified rig does not 

infringe. For example, the GSF injunction requires GSF 

to report periodically on its use of the rig. Whether GSF 

provides these reports only goes to its compliance with the 

injunction, not whether the rig is infringing. In other 

words, if GSF keeps the casing sleeve in place, but fails to 

report, it will not change the noninfringing design to an 

infringing one. By implementing this design, Maersk 

USA is not infringing with the delivered rig. Transocean’s argument regarding the legal standards is similarly unavailing. Although it is true that the GSF court 

performed its analysis in the context of an injunction, it 

determined that the modified rig did not infringe. 

We hold that the district court did not err in holding 

that Transocean is collaterally estopped from arguing 

that the rig modified in accordance with the GSF injunction infringes any of the asserted claims. On remand, 

Transocean may argue that the unmodified design (without the casing sleeve) was the subject of the Maersk 

USA/Statoil contract and that therefore there is infringement of the asserted claims based on both a sale and offer 

to sell. Transocean, however, is estopped from arguing 

infringement by the modified rig that Maersk USA actually delivered to the U.S. 

D. Willfulness 

“Proof of willful infringement . . . requires at least a 

showing of objective recklessness.” In re Seagate Tech., 

LLC, 497 F.3d 1360, 1371 (Fed. Cir. 2007) (en banc). The 

patent owner “must show by clear and convincing evidence that the infringer acted despite an objectively high 

likelihood that its actions constituted infringement of a 

valid patent.” Id. (citing Safeco Ins. Co. of Am. v. Burr, 

551 U.S. 47 (2007)). This objective standard is a threshold. Once met, the patentee must show that the infringer 
TRANSOCEAN v. MAERSK CONTRACTORS 26

knew or should have known of the objectively high risk. 

Seagate, 497 F.3d at 1371. 

The district court granted summary judgment of no 

willfulness. The court held that because Maersk USA 

modified its design to conform to the GSF injunction, it 

could not be “objectively reckless,” and thus could not be 

willful as a matter of law. Willfulness Order at *9. 

Transocean argues that the district court erred by 

looking only to Maersk USA’s conduct after the modification to conform to the GSF injunction. It asserts that at 

the time of the contract between Statoil and Maersk USA, 

Maersk USA knew of the patents-in-suit and acted objectively recklessly by proceeding with the contract. It 

points to the contract that allowed Maersk USA to make 

changes to the rig pending the outcome of any “court or 

administrative determinations that favour the validity or 

infringement arguments of Transocean” related to Transocean’s patents, including the patents-in-suit. J.A. 7190-

91. Transocean argues that this shows that Maersk USA 

knew of the patents-in-suit and ignored an objectively 

high likelihood that it infringed. Transocean also argues 

that an internal Maersk memorandum that discusses the 

Transocean dual activity rig is evidence of copying that 

supports its case for willful infringement. 

Maersk USA argues that its decision to modify the rig 

according to the GSF injunction shows that Maersk USA 

purposely avoided any potential infringement and this 

should preclude a finding of willfulness as a matter of 

law. Regarding copying, Maersk USA argues that there is 

no evidence that it copied a design that it knew was 

patented and that, regardless, it took steps to avoid 

infringement with the modified rig once the GSF court 

entered its injunction. 
27 TRANSOCEAN v. MAERSK CONTRACTORS

We agree with the district court that, as a matter of 

law, there is no willfulness. Although the contract does 

show that Maersk USA knew of Transocean’s patents, it 

also shows intent to avoid infringement. Maersk USA 

reserved the right to modify the rig in response to any 

court proceeding that favored “the validity or infringement arguments of Transocean.” J.A. 7190. In fact, 

Maersk USA did modify its rig once the court in the GSF 

litigation issued an injunction defining a noninfringing 

alternative. We hold, as a matter of law, that Maersk's 

actions were not objectively reckless and thus affirm the 

district court’s holding of no willfulness. 

CONCLUSION

Because there remain genuine issues of material fact 

regarding objective evidence of nonobviousness and undue 

experimentation, the grant of summary judgment relating 

to obviousness and enablement is reversed. Because the 

contract between Statoil and Maersk USA is both an offer 

to sell and a sale, we vacate the district court’s summary 

judgment of noninfringement and remand for further 

findings on infringement based on the rig that was the 

subject of this contract. We affirm the district court’s 

holding of summary judgment of no willfulness. 

REVERSED-IN-PART, VACATED-IN-PART, 

AFFIRMED-IN-PART, and REMANDED