IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF DELAWARE ENERFEX, INC. ) ) Plaintiff, ) ) v.

) ) ) UOP LLC, Quicksilver Resources Inc., and ) BreitBurn Energy Partners L.P. ) ) Defendants. )

Civil Case. No.______ JURY TRIAL DEMANDED

COMPLAINT For its complaint against Defendants UOP LLC (hereinafter UOP LLC), Quicksilver Resources Inc. (hereinafter Quicksilver), and BreitBurn Energy Partners L.P. (hereinafter BreitBurn), Plaintiff Enerfex, Incorporated (hereinafter Enerfex) alleges as follows: THE PARTIES 1. Plaintiff Enerfex is a corporation organized and existing under the laws of the

State of Vermont and has its principal place of business at 503 Nobles Hill Road, Isle La Motte, Vermont, 05463. 2. Defendant UOP LLC is a limited liability company organized and existing under

the laws of the State of Delaware, and has its principal place of business at 25 East Algonquin Road, P.O. Box 5071, Des Plaines, Illinois, 60017. 3. or UOP, Inc. 4. Universal Oil Products Company was incorporated in the State of Delaware on Defendant UOP LLC was originally known as Universal Oil Products Company

March 3, 1975.

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5.

In 1988, a company known simply as UOP was formed as a New York general

partnership by combining UOP, Inc. and the Catalysts, Adsorbents and Process Systems business of Union Carbide Corporation. 6. In 1997, the general partnership known as UOP was converted to a limited

liability company organized under the laws of the State of Delaware. 7. Defendant Quicksilver is a corporation organized and existing under the laws of

the State of Delaware, and has its principal place of business at 801 Cherry Street, Suite 3700, Unit 19, Fort Worth, TX 76102. 8. Defendant BreitBurn is a limited partnership organized and existing under the

laws of the State of Delaware, and has its principal place of business at 515 S. Flower St, Ste. 4800, Los Angeles, CA 90071. 9. UOP LLC has manufactured and installed a two stage membrane system, with

Separex membranes in a natural gas processing plant near Gaylord, Michigan, known as the HAYES 29 Plant, for Quicksilver. 10. The HAYES 29 Plant was owned and operated by Quicksilver until on or about

November 1, 2007. 11. On or about November 1, 2007, ownership and operation of the HAYES 29 Plant

was transferred to BreitBurn.

JURISDICTION AND VENUE 12. This action arises under the Patent Laws of the United States, including, but not

limited to, 35 U.S.C. 1 et seq. This court has jurisdiction over the subject matter hereof under the provisions of 28 U.S.C. 1331 and 1338(a).

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13. 1400(b). 14.

Venue in this judicial district is proper pursuant to 28 U.S.C. 1391(b) (c) and

UOP LLC is subject to personal jurisdiction in the District of Delaware because it

is incorporated in the State of Delaware. 15. Quicksilver is subject to personal jurisdiction in the District of Delaware because

it is incorporated in the State of Delaware. 16. BreitBurn is subject to personal jurisdiction in the District of Delaware because it

is incorporated in the State of Delaware.

GENERAL ALLEGATIONS 17. Plaintiff Enerfex is the owner of the entire right, title and interest in and to U.S.

Patent No. 5,482,539, and entitled Multiple Stage Semi-Permeable Membrane Process and Apparatus for Gas Separation (the 539 patent), a copy of which is attached hereto as Exhibit A. 18. The 539 Patent was duly and legally issued to inventor Richard Callahan on

January 9, 1996 (the date of the Patent), and Callahan subsequently assigned to Plaintiff Enerfex, a company which he founded, and of which he is the 66.31% holder of the entire right, title and interest, in and to the 539 patent, including all rights to recover damages for all infringements thereof, including past infringements as of October 7, 1994 by virtue of an assignment dated October 7, 1994, recorded at Reel 7177, Frame 872. 19. Defendant UOP LLC is a multinational corporation, engaged in the business of

providing products and services in the areas of refining, petrochemicals, natural gas and biofuels.

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20.

UOP LLC designs, manufactures, installs, monitors, services, operates and repairs

two stage membrane systems, designed to separate carbon dioxide (CO2) from a feed gas. (two stage membrane systems). 21. UOP LLC designs, manufactures, installs, monitors, services, operates and

repairs specific types of membranes in their two stage membrane systems, known as Separex membranes.

THE HAYES 29 PLANT 22. Since on or about December 1993 UOP LLC (or its predecessor entities for whose

acts it is liable, upon information and belief) has installed and participated in designing, installing, monitoring, servicing, operating and repairing two stage membrane systems for removing carbon dioxide (CO2) from natural gas in the United States. Such a system was installed and has been operated in Northern Michigan at the HAYES 29 Plant (the plant) by UOP, and was described in a 1995 article (Cook, Jeff and M.S. Losin, Membranes Provide Cost-Effective Natural Gas Processing, Hydrocarbon Processing, April 1995, p. 79-84) (Exhibit B).

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23.

The configuration of the membrane system used in the plant is illustrated in

Exhibit B on page 80, Figure 2, and is pictorially represented as follows:

24.

In Exhibit B, the Table in Figure 2, on p. 80, provides the operating parameters of

the system described from which it is seen that the carbon dioxide stream produced by the system (the vent gas) was 81.1% carbon dioxide concentration for an inlet feed containing 11% carbon dioxide concentration. 25. From the same Table in Figure 2 it is understood that the composition of the

sales gas contained 1.9% carbon dioxide concentration and by calculation from the given data in the table approximately 97.4% of the methane in the Feed Gas was recovered in the Sales Gas. 5
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26.

According to the article (Exhibit B) 24-27% of the inlet stream to the first stage

permeated through the first stage (p. 84). 27. The concentration of methane disclosed (Fig. 2 of Exhibit B) in the vent gas

(permeate from second stage) was 18.7% mixed with 81.1% carbon dioxide concentration. 28. Unless otherwise captured, this methane in the vent gas would undesirably be

vented to the atmosphere or flared (burned) and be wasted. 29. Subsequently in a 2007 paper entitled The Benefit of Experience the authors

Jeff Cook and William Echt, Hydrocarbon Engineering, May 2007, Vol. 12, No. 5, p. 23-27, discuss their experience operating the plant, (Exhibit C) with specific reference to their previous article for background (Ex. B). 30. Exhibit C once again illustrates the two stage system as shown below:

31.

According to Exhibit C vent losses (methane emissions to the atmosphere) were

reduced from 2-2.5% methane to less than 1% on or about April 2006 at least in part by changing the (Separex) membrane elements in the first stage of the 2-stage system to new, improved membrane elements and reducing the temperature of the feed gas to the system. 6
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32.

Figure 4 of Exhibit C discloses that methane losses in the vent gas, as a percent of

methane in the feed gas, after the change to the new, improved membrane elements and the lower feed gas temperature, were about 0.37% in April, 0.75% in May, 0.66% in June, 0.28% in July and 0.31% in August of 2006.

33.

Thus, by virtue of the changes to the system made by UOP LLC and the

Defendants, the amount of methane loss in the vent gas was reduced from 1.9% to 2.1% (Exhibit B) and about 2.375% in Mar 2006 (Figure 4, Exhibit C), to less than 1% (Figure 4, Exhibit C), even though the feed gas concentration of carbon dioxide increased to 12% instead of 11% as in Exhibit B.

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Figure 3 (Exhibit C) 34. Additionally, using the Feed Gas and Sales Gas CO2 concentrations from Figure 3

of Exhibit C and the methane losses as a percent of feed gas methane after April 2006 from Figure 4 of Exhibit C, by calculation it can be seen that the concentration of carbon dioxide in the vent gas is above 96% and as high as almost 97%, as opposed to 81.1% in the system of Exhibit B, and as opposed to 83.059% before March 31, 2006 (Exhibit C) prior to modification of the system. 35. Similarly, the amount of valuable methane recovered in the sales gas increased

from 97.4% in Exhibit B, and 97.625% before March 31, 2006, to 99.632% after the modifications that occurred on or about April 1, 2006. 36. The intrinsic permeability of the membrane in the first stage of Exhibit C is

greater than the intrinsic permeability of the second stage. 37. 38. The selectivity of the first stage is less than the selectivity of the second stage. As a result of the modifications described in Exhibit C there is a greater

percentage of methane gas available to sell. 39. As a result of the modifications described in Exhibit C the purity of the carbon

dioxide in the vent gas of the second stage is greater than approximately 96%. 8
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40.

The high purity carbon dioxide produced at HAYES 29 is available for use to

enhance oil recovery.

THE 539 PATENT 41. The 539 patent is directed to a membrane process and apparatus for producing a

very high purity permeate gas with a two stage membrane process which is fed by an inlet feed gas mixture. 42. As disclosed and claimed the feed gas mixture is fed to a first membrane separator

unit having a relatively high intrinsic permeability to provide an intermediate permeate gas and a retentate gas (Sales Gas). The intermediate gas permeate is provided to a secondary membrane separator unit having a high selectivity to produce a very high purity permeate (Vent Gas). 43. shown below: The apparatus of the 539 patent is schematically illustrated in the patent as

44.

Claim 1 of the 539 patent is:

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A membrane process for the production of a desired very high purity permeate gas product from a feed gas mixture containing less than 40 vol % of the desired permeate gas, which process comprises providing in a primary stage a process feed gas mixture to a primary membrane separator unit comprising a membrane having a relatively high intrinsic permeability, to provide an intermediate permeate gas and a retentate gas, and providing the intermediate permeate gas in a secondary stage to a secondary membrane separator unit comprising a membrane having a relatively high selectivity, to produce therefrom the very high purity permeate gas product. 45. Operation of the system described in Exhibit C meets every single limitation of

claim 1 of the 539 patent. 46. By way of further example, Claim 11 of the 539 patent provides:

A membrane process as in claim 1, wherein the process feed gas mixture contains carbon dioxide and carbon dioxide is recovered as the very high purity permeate gas product at a purity of more than 96.0 vol %. 47. The HAYES 29 plant as described in Exhibit C is constructed and operated in a

way which infringes claim 11. 48. Besides the HAYES 29 plant UOP LLC has also installed, designed,

manufactured, installed, monitored and serviced a two stage membrane system, with Separex membranes in a Chester plant in Michigan, for UOP LLC customer Quicksilver which likewise infringes claim 11. 49. UOP LLC has also installed, designed, manufactured, installed, monitored and

serviced a two stage membrane system, with Separex membranes in New Jersey, for UOP LLC customer Newpoint Gas which infringes claim 11. 50. UOP LLC, without the authorization of Enerfex, is making, using, selling,

offering for sale, exporting and/or importing two stage membrane systems designed to be operated in a manner which infringes the 539 patent.

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COUNT I PATENT INFRINGEMENT UOP LLC Direct Infringement 51. this complaint. 52. UOP LLC, without Enerfexs authorization, is infringing the claims of the 539 Plaintiff Enerfex re-alleges and incorporates by reference paragraphs 1 50 of

patent by making, using, selling, offering for sale, installing, monitoring, servicing, exporting and/ or importing two stage membrane systems expressly designed to be operated in a manner covered by the 539 patent. 53. UOP LLCs infringement of the claims of the 539 patent is intentional, willful,

wanton and deliberate, without license, and with full knowledge of Plaintiffs rights. 54. 55. Plaintiff Enerfex has been damaged by UOP LLCs acts of infringement. Unless restrained by this Court, UOP LLC will continue its acts of infringement

and the resulting damages to Enerfex will be substantial, continuing and irreparable. Indirect Infringement 56. Defendant UOP LLC has induced and/or engaged in contributory infringement by

licensing, marketing, selling, distributing, maintaining, repairing, , monitoring, reconstructing and/or servicing, within the United States, two stage membrane systems, that it intends to be operated in a manner which infringes claims of the Patent-in-Suit, and actively induces and encourages the same, without Plaintiffs authorization.

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COUNT II PATENT INFRINGEMENT - QUICKSILVER Direct Infringement 57. Quicksilver, without Enerfexs authorization, has infringed the claims of the 539

patent by owning and operating the HAYES 29 Plant prior to on or about November 1, 2007, in a manner which is covered by the 539 patent. 58. Quicksilvers infringement of the claims of the 539 patent is intentional, willful,

wanton and deliberate, without license, and with full knowledge of Plaintiffs rights. 59. Plaintiff Enerfex has been damaged by Quicksilvers acts of infringement. Indirect Infringement 60. Defendant Quicksilver has induced and/or engaged in contributory infringement

by licensing, marketing, selling, distributing, maintaining, repairing, operating, reconstructing and/or servicing, within the United States, two stage membrane systems, that it intends to be operated in a manner which infringes the claims of the Patent-in-Suit, and actively induces and encourages the same, without Plaintiffs authorization. COUNT III PATENT INFRINGEMENT - BREITBURN Direct Infringement 61. BreitBurn, without Enerfexs authorization, has infringed by owning and

operating the HAYES 29 Plant from on or about November 1, 2007, in a manner which uses a two stage membrane systems in a process covered by the 539 patent. 62. BreitBurns infringement of the claims of the 539 patent is intentional, willful,

wanton and deliberate, without license, and with full knowledge of Plaintiffs rights.

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63. 64.

Plaintiff Enerfex has been damaged by BreitBurns acts of infringement. Unless restrained by this Court, BreitBurn will continue its acts of infringement

and the resulting damages to Enerfex will be substantial, continuing and irreparable. Indirect Infringment 65. Defendant BreitBurn has induced and/or engaged in contributory infringement by

licensing, marketing, selling, distributing, maintaining, repairing, operating, reconstructing and/or servicing, within the United States, two stage membrane systems, that it intends to be operated in a manner which infringes the claims of the Patent-in-Suit, and actively induces and encourages the same, without Plaintiffs authorization. COUNT IV WILLFUL INFRINGEMENT - UOP, LLC 66. UOP LLC has been on notice since at least as early as November 2007 of the

existence of the 539 patent by virtue of an email dated November 7, 2007. 67. In response to Enerfexs letter, UOP LCC responded and said they do not

understand why you believe that your patent covers the operations of that membrane system. 68. Enerfex responded by explaining the advantages of the 539 patented process,

with reference to the HAYES 29 plant. 69. UOP LLC has continued to operate and encourage others to operate two stage

membrane systems in a manner which willfully infringes the 539 patent despite its knowledge of the 539 patent.

WHEREFORE, Enerfex prays that judgment be entered in its favor and against defendants as follows:

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A.

That UOP LLCs design and operation of their two stage Separex

membrane system on behalf of itself and its customers be declared as infringement under 35 U.S.C. 271. B. That Quicksilvers ownership and operation of the HAYES 29 Plant be

declared as infringement under 35 U.S.C. 271. C. That BreitBurns ownership and operation of the HAYES 29 Plant be

declared as infringement under 35 U.S.C. 271. D. That UOP LLC, Quicksilver, BreitBurn and their offices, directors,

employees, agents, licensees, servants, successors, subsidiaries, assigns and any and all persons acting in privity or in concert with them, be preliminarily and permanently enjoined and restrained, under 35 U.S.C. 283, from infringing, contributing to infringement by other or inducing others to infringe the 539 patent, including, without limitation, the sale, offer to sell, use, importation, advertising, transfer, disposal or promotion of UOP LLCs method of operating a two stage membrane system, or the aiding and abetting of any other persons performance of these acts. E. That damages pursuant to 35 U.S.C. 284, together with prejudgment

interest and costs, be awarded Plaintiff Enerfex from Defendants in an amount adequate to compensate Enerfex for defendants infringement of the 539 patent. F. That the patent damages be increased to three times the amount awarded,

as provided for under 35 U.S.C. 284. G. That the Court declare this to be an exceptional case and award Plaintiff

Enerfex its attorneys fees pursuant to 35 U.S.C. 285.

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JURY DEMAND Plaintiff Enerfex hereby demands a trial by a jury of twelve pursuant to Rule 38(a) of the Federal Rules of Civil Procedure on all issues so triable.

Dated: October 31, 2011 MCCARTER & ENGLISH

/s/ Daniel M. Silver Michael P. Kelly (#2295) Daniel M. Silver (#4758) Renaissance Centre 405 North King Street, 8th Floor Wilmington, DE 19801 (302) 984-6300 mkelly@mccarter.com dsilver@mccarter.com Attorneys for Plaintiff

Of Counsel: Neil F. Greenblum Greenblum & Bernstein, P.L.C. 1950 Roland Clarke Place Reston, Virginia 20191 (703) 716-1191

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