Thursday, June 12, 2014

Does the lack of estoppel from third-party IPRs weigh against staying parallel litigation?


The court granted defendants' motion to stay pending inter partes review and rejected plaintiff's proposal to condition the stay on defendants' agreement to be estopped from raising the same arguments as the IPR petitioners. "[A]lthough Plaintiff suggests it would be unfair for Defendants to obtain the benefit of IPR proceedings without being bound by the arguments raised therein, it would be more unfair to condition a stay on Defendants’ being bound by arguments raised in a proceeding over which they have no control. Defendants decided not to pursue IPR of the patents-in-suit on their own; they therefore run the risk that an unfavorable IPR decision — which they could have, but chose not to influence — will become part of the patent’s file. They also ran the risk that IPR would not be sought in the first place. Now that multiple non-parties have sought IPR of the patents-in-suit, and that the PTAB likely will apply its expertise to some or all of the arguments at issue in this case, it would defy common sense for this litigation to proceed alongside the IPR proceedings simply because Defendants are not statutorily prohibited from raising the same or similar arguments as the IPR petitioners."

Intellectual Ventures II LLC v. Huntington Bancshares Incorporated et al, 2-13-cv-00785 (OHSD June 10, 2014, Order) (Frost, J.)


The court denied without prejudice defendant's unopposed motion to stay pending inter partes review. "Third parties . . . have filed a petition for inter partes review of the [patents-in-suit]. . . . [T]he PTAB proceeding is at an even earlier stage than this litigation – it will take the PTAB up to three months from now to determine whether or not to institute the inter partes review at all. Whether a stay will simplify the issues in question and trial of the case is wholly unpredictable, if not completely speculative, at this time. . . . Even assuming the PTAB does institute the inter partes review, that [defendant] is not a party to the PTAB proceeding casts doubt on the extent, if any, a stay will simplify the issues in this case by way of the estoppel effect of the administrative proceeding."

MPHJ Technology Investments, LLC et al v. Research Now, Inc., 2-13-cv-00962 (TXED June 10, 2014, Order) (Gilstrap, J.)

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