press release

Unocal Supreme Court brief challenges refiners' claims on cleaner burning gasolines patent issue

El Segundo, Calif., Sept. 14, 2000 -- Unocal Corporation today filed a brief with the U.S. Supreme Court, opposing the petition by five of the world's largest oil companies that seeks a review of a Federal Circuit Court decision upholding Unocal's "393" patent for cleaner burning gasolines. [Download the full text (pdf) of the Unocal brief)]

Unocal requested that the Supreme Court deny the petition because it does not raise any significant issues involving patent law. In addition, the company's brief said the refiners' focus on the similarity of the patent to the California regulatory requirements is legally irrelevant and unsupported by the facts. The Unocal brief notes that the refiners' contention that somehow state requirements should supercede patent rights in this case was not presented or decided by the Federal Circuit Court.

"The claims by refiners that Unocal's patents have been a major factor in today's very high gasoline prices are economic nonsense," said Roger C. Beach, Unocal chairman and chief executive officer. This contention has been reviewed and rejected by several government agencies, including the U.S. Department of Energy, Environmental Protection Agency and Energy Information Administration.

Beach went on to say, "The major factors driving up gasoline prices are crude oil costs, increased demand, and problems in the supply chain. These are the same factors that are driving up the price of heating oil and diesel fuel. They have absolutely nothing to do with our patents.

"These litigants can't have it both ways," Beach continued, "on the one hand claiming that we're the cause of higher prices and on the other hand paying no royalties."

Unocal's brief also argued that the potential commercial value of the patent is not grounds for review. American patent law, based in the U.S. Constitution, was founded under the belief that all of society benefits if individuals and businesses have the financial incentive to develop inventions and make them available to the public. Under this system of protection of intellectual property, American industry has flourished for more than two centuries.

"Two courts have ruled that Unocal's conduct during the patent application process was legal and appropriate," Beach said. "The defendants tried to raise this bogus issue at trial, and then abandoned their claims. The undisputed evidence in the trial showed that Unocal's invention was well in advance of any regulatory action. Because of the unsupported nature of those contentions, the district court in Los Angeles awarded Unocal attorneys' fees from the defendants." The defendants continue to such allegations of improper conduct in the media, while deleting it from their Supreme Court brief.

Additional issues

Unocal addressed additional issues in its brief.

- Unocal offered to share its original research design for cleaner burning fuels with members of the Auto/Oil study group, but Unocal's proposal was rejected out of hand. Unocal then decided to conduct the research on its own. The defendants' media and lobbying campaign against the patent never mentions Unocal's initial offer..

All of the big oil refiners involved in this case, as well as the Big 3 U.S. automakers, including General Motors, were part of the Auto/Oil group that was formed in the late 1980s. The group agreement expressly protected individual companies' rights to conduct independent research on clean fuels and patent the results of their efforts. (See confidentiality agreement)

- California's RFG regulations included a predictive model that gave refiners flexibility in meeting the clean air standards, as opposed to a rigid fuel specification. Given Unocal's consistent support for increased flexibility in regulations, it is absurd to contend that the company guided the rulemaking process with CARB to maximize the value of its patents. Unocal applied for the "393" patent nearly a year before the CARB regulations were issued; the "393" patent was awarded to Unocal 18 months before the CARB regulations went into effect.

- During the Patent and Trademark Office review, Unocal actually narrowed the claims of its "393" patent. This is not unusual in the patent process. Under patent law, it is proper to "amend or insert claims into a patent after the application has been filed."

Unocal was also disappointed to hear that certain state attorneys general had agreed to sign an amicus. "We believe those decisions were based on misleading or incomplete information, not thoughtful and informed opinions about patent law and this case," Beach said. "We wish that there had been an opportunity for Unocal to provide the AGs additional facts prior to their signing the amicus," Beach said.

Unocal's cleaner burning gasoline invention represented a major breakthrough in reducing automobile tailpipe emissions. The company's independent research provided a cost-effective way of cleaning up the air without the need for expensive modifications to refineries and automobiles. Unocal filed for its first cleaner-burning gasoline patent in December 1990, more than a year before the California Phase 2 RFG regulations were completed, and nearly 10 years before the introduction of EPA Phase 2 RFG in the rest of the nation.

Since announcing the patent in January 1995, Unocal has repeatedly offered to negotiate fair and reasonable licensing arrangements with refiners and blenders. Unocal currently has no licensing agreemetns, nor is the company collecting any royalties.

For more information about Unocal's innovative approach to cleaner air, visit our patent web site.

Updated: September 2000