Shellef Holdings v. CRC Industries: Nonflammable Solvent Patent Dismissed Without Prejudice
Shellef Holdings, Inc. asserted US9816057B2 — covering nonflammable compositions containing 1,2-dichloroethylene — against CRC Industries and four major industrial distributors in the Western District of Texas. The case was resolved by mutual stipulation after 239 days, with all claims dismissed without prejudice and each party bearing its own costs.
Specialty Chemical Patent Dispute Exits Texas Court Without Merits Decision
On September 25, 2024, Shellef Holdings, Inc. filed suit against CRC Industries, Inc. and at least four industrial distributors — including Fastenal Company, Motion Industries, W.W. Grainger, and Rexel USA — in the Western District of Texas, Case No. 6:24-cv-00494. The complaint alleged infringement of US9816057B2, which protects nonflammable compositions containing 1,2-dichloroethylene, a solvent compound used in industrial cleaning and maintenance products.
The case closed on May 22, 2025, via a joint stipulation of dismissal filed under Federal Rule of Civil Procedure 41(a)(1)(A)(ii). All claims and defenses were dismissed without prejudice, and each party was directed to bear its own costs and attorneys’ fees. The without-prejudice designation is legally significant: Shellef Holdings retains the right to refile the same claims at a future date, subject to applicable statutes of limitations.
The 239-day resolution — before any substantive rulings on claim construction or validity — suggests the parties may have reached a private commercial arrangement, though the public record is silent on any settlement terms. The retention of costs by each side and the without-prejudice dismissal are consistent with a negotiated exit rather than a capitulation by either party. The involvement of Sterne Kessler, a firm with deep patent prosecution expertise, on the defense side signals CRC Industries treated the validity and infringement questions seriously from the outset.
Filing to Dismissed without Prejudice in 239 days
239 days from filing to stipulated dismissal — below median for patent cases in W.D. Tex.
Dismissed without prejudice: what the stipulation means for both parties
Rule 41(a)(1)(A)(ii) — stipulated dismissal by all parties
Under Federal Rule of Civil Procedure 41(a)(1)(A)(ii), any party may seek dismissal once the defendant has answered or moved for summary judgment — but only by filing a stipulation signed by all parties. That all parties signed here signals a consensual resolution. No court order was required; the dismissal takes effect upon filing. Because it is without prejudice, no res judicata bar attaches to the underlying infringement claims.
No merits adjudicationWithout prejudice: the door remains open for Shellef Holdings
A dismissal without prejudice means Shellef Holdings has not waived its infringement claims against CRC Industries or the distributor defendants. The patent remains in force and enforceable. Shellef could refile against any of these defendants — or new ones — within the applicable statute of limitations window. By contrast, a dismissal with prejudice would have permanently barred those claims. The public record does not disclose which outcome was sought or what, if anything, was exchanged.
Claims preserved; refiling possibleCRC Industries exits without a validity win — exposure persists
CRC Industries and its co-defendants obtained dismissal but received no adjudication of non-infringement or invalidity of US9816057B2. The without-prejudice terms mean the litigation risk has been deferred, not eliminated. The retention of their own costs suggests defendants did not extract a fee-shifting concession. Companies continuing to manufacture or distribute nonflammable 1,2-dichloroethylene compositions should monitor Shellef Holdings’ enforcement posture closely.
Validity unresolved; risk deferredPatent US9816057B2 remains a live threat across the supply chain
The dismissal without prejudice preserves Shellef Holdings’ ability to assert US9816057B2 against the same defendants or new entrants in the nonflammable solvent space. The presence of major industrial distributors — Fastenal, Grainger, Rexel, Motion Industries — as named defendants signals a broad enforcement strategy targeting the full supply chain. Competitors and distributors in the 1,2-dichloroethylene specialty chemical market should assess their freedom-to-operate exposure before the claims are refiled.
Supply chain-wide FTO review warrantedFull party and counsel information
| Role | Name | Type | Detail |
|---|---|---|---|
| Plaintiff | SHELLEF HOLDINGS, INC | Company | Specialty chemical IP holding company — holder of US9816057B2 covering nonflammable 1,2-dichloroethylene compositionsSearch in Eureka ↗ |
| Defendant | CRC INDUSTRIES, INC | Company | CRC Industries, Inc. — manufacturer of specialty chemical maintenance products; co-defendants are major industrial distributorsSearch in Eureka ↗ |
| Plaintiff counsel | Domingo Manuel Llagostera | Attorney | Counsel for SHELLEF HOLDINGS, INCSearch in Eureka ↗ |
| Plaintiff counsel | Megan R. Wood | Attorney | Counsel for SHELLEF HOLDINGS, INCSearch in Eureka ↗ |
| Plaintiff law firm | Blank Rome LLP | Law Firm | Representing SHELLEF HOLDINGS, INCSearch in Eureka ↗ |
| Defendant counsel | Dennies Varughese | Attorney | Counsel for CRC INDUSTRIES, INCSearch in Eureka ↗ |
| Defendant counsel | Jacqueline P. Altman | Attorney | Counsel for CRC INDUSTRIES, INCSearch in Eureka ↗ |
| Defendant counsel | John A. Powell | Attorney | Counsel for CRC INDUSTRIES, INCSearch in Eureka ↗ |
| Defendant counsel | John P. Palmer | Attorney | Counsel for CRC INDUSTRIES, INCSearch in Eureka ↗ |
| Defendant counsel | Jonathan Tuminaro | Attorney | Counsel for CRC INDUSTRIES, INCSearch in Eureka ↗ |
| Defendant counsel | Sasha S. Rao | Attorney | Counsel for CRC INDUSTRIES, INCSearch in Eureka ↗ |
| Defendant law firm | Naman, Howell, Smith & Lee, PLLC | Law Firm | Representing CRC INDUSTRIES, INCSearch in Eureka ↗ |
| Defendant law firm | Sterne, Kessler, Goldstein & Fox PLLC | Law Firm | Representing CRC INDUSTRIES, INCSearch in Eureka ↗ |
| Presiding judge | Judge N/A | Judge | Texas Western District CourtSearch in Eureka ↗ |
Official order — verbatim text
The stipulation cites Rule 41(a)(1)(A)(ii) and expressly states dismissal of ‘all claims and defenses, without prejudice.’ The phrasing is unambiguous: no claim was adjudicated on the merits, no validity determination was reached, and no infringement finding was made in either direction. The mutual cost-bearing provision is notable — it forecloses any inference that one party materially prevailed. The without-prejudice designation is the operative legal term: it preserves Shellef Holdings’ right to refile and prevents any claim-preclusion defence by CRC Industries in a future action based on the same patent and products.
US9816057B2 — Nonflammable Composition Containing 1,2-Dichloroethylene
US9816057B2, filed under application number US14/523075, protects nonflammable compositions containing 1,2-dichloroethylene — a chlorinated solvent with applications in industrial degreasing, parts cleaning, and maintenance products. The patent covers the formulation of these compositions in a manner that achieves nonflammability, a commercially valuable safety characteristic that distinguishes the product from flammable solvent alternatives. The technical domain sits at the intersection of industrial chemistry, formulation science, and occupational safety compliance.
For the specialty chemical and industrial MRO (maintenance, repair and operations) sector, US9816057B2 represents a potentially significant barrier to entry. CRC Industries is a recognised manufacturer of maintenance chemicals sold through exactly the distributor channels named as defendants — Fastenal, Grainger, Rexel, and Motion Industries. If the claimed formulation is broad enough to capture commercially available nonflammable solvent products, the patent holder could assert it across a substantial share of the industrial cleaning market. Competitors developing nonflammable solvent formulations should map their compositions against the claims before commercialisation.
Should your team run an FTO against US9816057B2?
Any R&D team or product manager working on nonflammable solvent formulations — particularly those incorporating 1,2-dichloroethylene or structurally similar chlorinated compounds — should treat US9816057B2 as a live freedom-to-operate concern. The case’s dismissal without prejudice means the patent holder has not released any rights, and the patent remains in full force. Distributors and resellers of industrial cleaning products should review supplier indemnification terms and confirm that upstream manufacturers have conducted their own FTO assessments.
PatSnap Eureka’s FTO Search Agent can map the claim landscape of US9816057B2 against your specific formulation parameters, flag overlapping prior art, and identify any continuation or divisional applications that could extend the claim footprint. Given that the dismissal preserved all of Shellef Holdings’ enforcement options, building a documented FTO position now provides a stronger foundation for any future invalidity challenge or design-around strategy. Search US9816057B2 in Eureka to begin your analysis.
Run a freedom-to-operate analysis on US9816057B2 to assess your product’s exposure
Run FTO in Eureka →Similar Specialty Chemical Patent Infringement Cases in W.D. Texas
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What this case signals for the specialty chemical IP landscape
A without-prejudice exit in Western District of Texas rarely marks the end of the enforcement story — it typically marks a pause.
Distributor defendants signal a deliberate supply-chain enforcement strategy
Naming Fastenal, Grainger, Rexel, and Motion Industries alongside the manufacturer is a classic IP enforcement tactic designed to pressure the commercial ecosystem. Distributors typically have fewer resources to sustain prolonged litigation and may create settlement leverage against the primary manufacturer. Companies distributing specialty chemical products should establish indemnification protocols with their suppliers.
Without-prejudice dismissal does not mean the patent is commercially neutral
US9816057B2 remains issued and enforceable. Shellef Holdings retains all enforcement rights. Any competitor or entrant in the nonflammable 1,2-dichloroethylene formulation space who interprets this dismissal as a cleared path does so at significant legal risk. A formal FTO analysis against this patent is warranted before commercialisation of any competing product.
SHELLEF v CRC — key questions answered
Shellef Holdings, Inc. filed a patent infringement action against CRC Industries and four industrial distributors in the Western District of Texas on September 25, 2024, asserting US9816057B2 over nonflammable 1,2-dichloroethylene compositions. The case was dismissed without prejudice by joint stipulation under Rule 41(a)(1)(A)(ii) on May 22, 2025, with each party bearing its own costs. No merits ruling was issued.
A dismissal without prejudice means Shellef Holdings has not waived its patent rights. US9816057B2 remains issued and enforceable, and Shellef Holdings may refile infringement claims against CRC Industries, the distributor defendants, or new parties at any time within the applicable statute of limitations. No court ruled on validity or infringement, so the patent’s legal status is unchanged.
Naming industrial distributors alongside the manufacturer is a well-recognised patent enforcement strategy. Distributors are liable for infringement through their sale of accused products, and their inclusion creates broad litigation pressure across the supply chain. It can accelerate settlement by threatening multiple revenue-generating relationships simultaneously. Each distributor defendant is a major MRO distributor that would carry CRC Industries’ product lines.
Sterne Kessler, Goldstein & Fox is one of the leading patent prosecution and IPR defence firms in the United States. Their involvement suggests CRC Industries pursued or at minimum evaluated an inter partes review challenge to US9816057B2 at the USPTO as part of its defence strategy. The early resolution before claim construction may be partly attributable to the credibility of an IPR threat, though the public record does not confirm whether a petition was filed.
US9816057B2 is a US patent assigned to Shellef Holdings, Inc., filed under application number US14/523075. It covers nonflammable compositions containing 1,2-dichloroethylene, a chlorinated solvent used in industrial cleaning, degreasing, and maintenance products. The patent’s commercial significance lies in the nonflammability characteristic, which addresses regulatory and safety requirements in industrial and occupational settings where flammable solvent use is restricted.
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