Indiana Patent Litigation: CleanTech Sues Pacific Ethanol Magic Valley

Indianapolis, Indiana – A patent attorney for GS CleanTech Corporation of Alpharetta, E-85picture.jpgGeorgia (“CleanTech”) filed a patent infringement lawsuit in the District of Idaho alleging that Pacific Ethanol Magic Valley, LLC of Burley, Idaho (“Pacific”); ICM, Inc. of Colwich, Kansas; and David J. Vander Griend of Wichita, Kansas infringed Patent Nos. 7,601,858 – “Method of Processing Ethanol Byproducts and Related Subsystems“; 8,008,516 – “Method of Processing Ethanol Byproducts and Related Subsystems“; 8,008,517 – “Method of recovering Oil From Thin Stillage“; and 8,283,484 – “Method of Processing Ethanol Byproducts and Related Subsystems“, which have been issued by the U.S. Patent Office. The case was transferred to the Southern District of Indiana as part of Multidistrict Litigation No. 2181.

This litigation began with an assertion of patent infringement by CleanTech of the ‘858 patent, which was issued on October 13, 2009. CleanTech sued numerous Defendants alleging infringement of that patent shortly after its issuance. The Defendants accused of patent infringement in prior patent infringement litigation include: Big River Resources Galva, LLC; Big River Resources West Burlington, LLC; Cardinal Ethanol, LLC; ICM, Inc.; LincolnLand Agri-Energy, LLC; David J. Vander Griend; Iroquois Bio-Energy Co., LLC; Al-Corn Clean Fuel; Blue Flint Ethanol, LLC; ACE Ethanol, LLC; Lincolnway Energy, LLC; United Wisconsin Grain Producers, LLC; Bushmills Ethanol, Inc.; Chippewa Valley Ethanol Co.; Heartland Corn Products, Adkins Energy, LLC, Little Sioux Corn Processors, LLLP; Southwest Iowa Renewable Energy, LLC; Western New York Energy, LLC; Homeland Energy Solutions, LLC; Pacific Ethanol, Inc.; Guardian Energy, LLC and Pacific Ethanol Stockton LLC. This Indiana patent lawsuit is being overseen in the Southern District of Indiana pursuant to the provisions for Multidistrict Litigation (“MDL”).

Since September 29, 2011, when the court overseeing the MDL issued its order on claim construction with respect to the disputed claims of the ‘858 patent, patentees CleanTech and its parent GreenShift Corp. have also asserted infringement by some of the allegedly infringing Defendants of four additional patents related to the ‘858 patent: U.S. Patent Nos. 8,008,516 (the “‘516 patent”), 8,008,517 (the “‘517 patent”), 8,283,484 (the “‘484 patent”) and, the newest addition, 8,168,037 (“the ‘037 patent”), (the ‘858, ‘516, ‘517, ‘484 and ‘037 patents are, collectively, the “‘858 patent family” or “the patents-in-suit”). Four of the patents in the “‘858 patent family” – the ‘858 patent, the ‘516 patent, the ‘517 patent, and ‘484 patent – have purportedly been infringed by Pacific.

CleanTech claims that the methods claimed increase the efficiency and economy of recovering corn oil. CleanTech’s patented methods recover corn oil by evaporating, concentrating and mechanically separating thin stillage (“stillage”), a byproduct of ethanol produced from corn, into two components: corn oil and a post-recovery syrup (“syrup”) with most of its corn oil removed.

In one embodiment, the patented method comprises initially processing the whole stillage by mechanically separating (such as by using a centrifugal decanter) the whole stillage into distillers wet grains and thin stillage, and then introducing the thin stillage into an evaporator to form a concentrated syrup byproduct. Prior to recombining the then-concentrated syrup with the distillers wet grains, the syrup is introduced into a second mechanical separator, such as a second centrifuge, which is different from the centrifuge that mechanically separated the whole stillage into distillers wet grains and thin stillage. This second centrifuge separates corn oil from the syrup thereby allowing for the recovery of usable corn oil. The syrup that exits the centrifuge is then recombined with the distillers wet grain and dried in a dryer. The corn oil that is extracted from the syrup can be used for various purposes such as feedstock for producing biodiesel.

In this current lawsuit, initiated in the District of Idaho, subsidiary GS CleanTech Corp. is the sole Plaintiff. A patent lawyer for CleanTech asserts the following counts against Pacific:

• Count I: Infringement of U.S. Patent No. 7,601,858
• Count II: Infringement of U.S. Patent No. 8,008,516
• Count III: Infringement of U.S. Patent No. 8,008,517
• Count IV: Infringement of U.S. Patent No. 8,283,484

CleanTech asks the court for preliminary and permanent injunctions prohibiting further infringement of the patents-in-suit; an award of damages adequate to compensate CleanTech for the infringement that has occurred, but in no event less than a reasonable royalty for the use made of the inventions of the patents-in-suit as provided in 35 U.S.C. § 284, together with prejudgment interest from the date the infringement began; and an award to CleanTech of all remedies available under 35 U.S.C. §§ 284, 285 and 154(d).

Practice Tip: More than thirty ethanol-production plants have executed installation and licensing agreements with GreenShift Corp., the parent company of CleanTech, for its corn-oil extraction system. When deciding whether to avoid the potential of being included as an additional defendant in ongoing patent infringement litigation, it’s useful to consult an experienced patent attorney to evaluate the possibility of licensing rights to use the patent(s)-in-suit.

The suit was filed by Steven S. Schossberger of Hawley Troxell Ennis & Hawley LLP. The case was assigned to District Judge Larry J. McKinney and Magistrate Judge Debra McVicker Lynch in the Southern District of Indiana and assigned Case No. 1:14-cv-08020-LJM-DML.


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