IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION

Charlotte R. Droughton, Plaintiff vs. ConocoPhillips Company, Defendant.

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Civil Action No. 4:12-cv-01157 JURY TRIAL DEMANDED

PLAINTIFFS ORIGINAL COMPLAINT Plaintiff, Charlotte R. Droughton (Plaintiff), brings this action against the Defendant, ConocoPhillips Company (COP) and for its causes of action alleges as follows: THE PARTIES 1. 2. Plaintiff is an individual residing in Harris County, Texas. ConocoPhillips Company, upon information and belief, is a corporation organized under the laws of the State of Delaware. Also upon information and belief, COP maintains an office in the State of Texas at 600 N. Dairy Ashford Road, Houston, Texas 77079, and may be served with process by serving its registered agent, United States Corporation Company at 211 E. 7th Street, Suite 620, Austin, Texas 78701. JURISDICTION & VENUE 3. This is an action for infringement of a United States patent. Accordingly, this action arises under the patent laws of the United States of America, 35 U.S.C. 100 et. seq., particularly 35 U.S.C. 271. 1

4.

This Court has subject matter jurisdiction over this action pursuant to 28 U.S.C. 1331 and 1338(a) and has supplemental jurisdiction over Plaintiffs cause of action for breach of contract pursuant to 28 U.S.C. 1367(a).

5.

Venue is proper in this Court under 28 U.S.C. 1391(b) and 1400(b). FACTS COMMON TO ALL COUNTS

6. 7.

Paragraphs 1 through 5 are incorporated herein by reference. In or around the fourth quarter of 2003, Plaintiff was introduced by COPs Supplier Diversity Manager, Hubert Jones, to Howard Foy, a manager in COPs Refining Technologies. Plaintiff and Mr. Foy discussed Plaintiffs ability to direct COP in developing methods for processing heavy or otherwise unconventional crude oils.

8.

Over the next few months, Plaintiff discussed the contributions she and her company, Separation Engineers, Inc. (SEI) would be able to make to COPs refining business.

9.

On or about June 3, 2004, Plaintiff, on behalf of SEI, and COP entered into a confidentiality agreement that would allow COP to receive information relating to SEIs process for the precipitation and separation of asphaltenes from bulk oil that SEI refers to under the trademark ZetapolTM. The Confidentiality Agreement between Plaintiff and COP is attached hereto as Exhibit B.

10.

Following the execution of the agreement, Plaintiff and SEI made disclosures to COP regarding the Zetapol technology, including but not limited to disclosures made on June 22, 2004 and February 22, 2005. After the Confidentiality Agreement was signed, Plaintiff disclosed the proprietary additives involved in SEIs separation techniques to COP during a meeting with COPs Chief Engineer, Barbara Todd, COPs Director of Emerging Technology, Bharat Chahar, and COPs Downstream Research Manager, Scott Love. 2

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At the February 22, 2005 meeting among Plaintiff, Ms. Todd, Mr. Chahar, and Mr. Love, the parties discussed the confidential plan for testing of Merey crude as part of a technical evaluation of Plaintiffs Zetapol technology.

12.

On or about March 10, 2005, following the meeting and disclosure of Plaintiffs proprietary technique, Plaintiff sent a letter to COP memorializing the fact that confidential information had been disclosed to COP under the terms of the Confidentiality Agreement and reminding COP that such information was to remain confidential. COP did not respond to the letter, which is attached hereto as Exhibit C.

13.

On or about June 2, 2005, Plaintiff filed United States Patent Application No. 11/146,914 (the 914 application), titled Processing Unconventional and Opportunity Crude Oils Using Zeolites.

14.

In the second quarter of 2006, a COP employee advised Plaintiff to hire an attorney due to COPs use of her proprietary technology.

15.

Upon information and belief, in or around the first half of 2006, COP began discussions with EnCana regarding the use of Zetapol technology at the Wood River and Borger refineries.

16.

On or about March 19, 2010, Plaintiff filed United States Patent Application No. 12/727,577, which is a continuation of the 914 application and which eventually became the patent-in-suit.

17.

On January 11, 2011, United States Patent No. 7,867,382 (the 382 patent), titled Processing Unconventional and Opportunity Crude Oils Using One or More Mesopore Structured Materials was issued to Plaintiff. A true and correct copy of the 382 patent is attached hereto as Exhibit A.

18.

Pursuant to 35 U.S.C. 282, the above-listed United States Patent is presumed valid. 3

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Plaintiff is the sole inventor and owner of the 382 patent. COUNT 1: PATENT INFRINGEMENT

20.

Upon information and belief, COP employs a method for treating unconventional or opportunity crudes that involves the use of at least one mesopore structured material in order to break an emulsion comprised of the opportunity or unconventional crude, water, salt and other contaminants.

21.

Upon information and belief, COP employs this method in its refineries, including upon information and belief, at least the Sweeny, Borger, Ferndale, Billings, and Wood River refineries, in order to process heavy crudes that were previously unusable or unprofitable.

22.

Upon information and belief, the methods used to process heavy crude at at least the abovereferenced refineries infringes the 382 patent, as does any other use by COP of the 382 patents claimed method of using a mesopore structured material, such as a zeolite, to break emulsions from unconventional or opportunity crudes.

23.

The infringement of the 382 patent alleged above has injured Plaintiff and thus, she is entitled to recover damages adequate to compensate for COPs infringement, which in no event can be less than a reasonable royalty.

24.

COPs use of the patented process has created significant cost savings for COP and has vastly increased product yields and throughputs.

25.

COP has had knowledge of Plaintiffs proprietary process since 2005 and Plaintiffs interest therein. COP has been and continues to be objectively reckless in ignoring the likelihood that it infringes a valid patent. COPs infringement of the382 patent is therefore willful.

COUNT 2: BREACH OF CONTRACT 26. The 2004 Confidentiality Agreement between COP and Plaintiff prohibits COP from using the confidential information disclosed under the agreement for any purpose other than evaluating whether to enter into a joint development or other business arrangement for the further development of [the] technology. 27. Upon information and belief, COP has used Plaintiffs proprietary information in a manner contrary to the Confidentiality Agreement, including but not limited to the use of Plaintiffs disclosed method for processing heavy or unconventional crudes through the use of mesopore structured materials, referred to as zeolites. 28. Also upon information and belief, COP has processed heavy crude at at least its Sweeny, Borger, Billings, Ferndale and Wood River refineries using the zeolite disclosed by Plaintiff under the above-referenced Confidentiality Agreement. 29. Plaintiffs technology allowed COP to purchase significantly less expensive crudes as feedstocks for the above-listed refineries, generating several dollars per barrel of additional profit compared to previously purchased, traditional crudes. 30. Plaintiff has been damaged by COPs unauthorized use of her proprietary technology in breach of the parties agreement, and COP has been unjustly enriched by the unauthorized use. DEMAND FOR JURY TRIAL 31. Plaintiff hereby demands a jury trial on all claims and issues. PRAYER FOR RELIEF WHEREFORE, Plaintiff prays for entry of judgment: A. that Defendant, COP, has infringed one or more claims of the 382 patent; 5

B.

that Defendant, COP, account for and pay to Plaintiff all damages caused by the

infringement of the 382 patent, which by statute can be no less than a reasonable royalty; C. D. that Defendants infringement is willful, granting Plaintiff treble damages; that Plaintiff be granted pre-judgment and post-judgment interest on the damages

caused to her by reason of COPs infringement of the 382 patent; E. F. that COP has breached the Confidentiality Agreement; that COP pay to Plaintiff all damages caused by its breach of the Confidentiality

Agreement, including the amount by which COP has been unjustly enriched at Plaintiffs expense; G. H. I. that Plaintiff be granted her attorneys fees in this action; that costs be awarded to Plaintiff; that Plaintiff be granted such other and further relief as the Court may deem just and

proper under the current circumstances.

DATED: April 17, 2012 Respectfully submitted, /s/ Edward W. Goldstein Edward W. Goldstein Attorney-in-Charge Texas Bar No. 08099500 Southern District of Texas Bar No. 586 Alisa A. Lipski Texas Bar No. 24041345 Southern District of Texas Bar No. 570018 GOLDSTEIN & LIPSKI, P.L.L.C. 1177 West Loop South, Suite 400 Houston, Texas 77027 Telephone: (713) 877-1515 Facsimile: (713) 877-1737 E-Mail: egoldstein@gliplaw.com alipski@gliplaw.com ATTORNEYS FOR PLAINTIFF 6