Back to top

Schlumberger Wins Supreme Court Patent Ruling Against ION

Read MoreHide Full Article

Schlumberger Limited (SLB - Free Report) recently won the U.S. Supreme Court ruling, which enabled the company to recover the profits lost due to unaccredited use of its patented technology outside the country by ION Geophysical Corporation (IO - Free Report) . The ruling countermanded a previous decision from a lower court that constrained the usage of U.S. patent law abroad.

The previous ruling from the lower court reduced the damage compensation by $93.4 million. The said Schlumberger technology is used for finding oil and gas under the ocean floor. The significance of the latest ruling is that it enhances the ability of the patent holders to stop rivals and other companies from using their technologies abroad. It also helps them recover profits that were lost due to unauthorized usage of its technologies.

Opponents have raised concern over the situation stating that the patent ruling might act as a risk bearer for the high-technology companies, which have operations outside the country. Schlumberger countered the idea as the law is expected to provide protection against any infringement, including those which occur abroad due to the supply of patented technology from the domestic market. Moreover, the company pointed toward the assembling done abroad using unsanctioned patented technology, as it hurts its foreign sales.

WesternGeco, a subsidiary of Schlumberger, was the one fighting the case against ION Geophysical regarding the use of four patented methods, used while conducting marine seismic survey. Notably, Schlumberger received compensation for damages caused due to the occurrence of infringement in the United States. Now the compensation basket includes the lost profits from overseas as well.

Price Performance

Schlumberger has gained 1.7% in the past year against 4.7% decline of its industry.

Zacks Rank and Stocks to Consider

Currently, Schlumberger carries a Zacks Rank #3 (Hold).

Investors interested in the Energy sector can opt for some better-ranked stocks like Continental Resources, Inc. (CLR - Free Report) , Delek US Holdings, Inc. (DK - Free Report) and HollyFrontier Corporation (HFC), each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Oklahoma City, OK-based Continental Resources is an upstream energy company. The company’s top line for 2018 is anticipated to improve 58.9% year over year. In the last four reported quarters, the company delivered an average positive earnings surprise of 80.5%.

Brentwood, TN-based Delek is an energy company. The company’s top line for 2018 is anticipated to improve 39.2% year over year, while its bottom line is expected to increase 326.2%.

The Hottest Tech Mega-Trend of All

Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.

See Zacks' 3 Best Stocks to Play This Trend >>

More from Zacks Analyst Blog

You May Like