Motions to Stay District Court Cases Pending Post-Grant Proceedings

Stays pending reexamination of a patent have always been an important consideration in the patent litigation process. In recent years, the America Invents Act created new proceedings, including inter partes review (IPR), covered business method review (CBM) and post-grant review (PGR) for challenging patents within the Patent and Trademark Office (PTO). Decided by the newly-constituted Patent Trial and Appeal Board (PTAB), the speed of these new proceedings, the initial success rates of challenges, and new estoppel rules all changed the calculus that district courts apply in deciding whether to stay litigation pending completion of a PTO proceeding. As a result, requests for litigation stays have become more common, and the number of stays granted by district courts has increased.

Judges exercise broad discretion, not only in deciding whether to grant or deny a stay, but also in determining the nature of a stay, such as whether the stay will apply to the entire case or whether the stay will remain in place indefinitely or for a fixed time. Since a litigation stay can have a significant impact on the outcome of the litigation, making more informed, data-driven decisions has become more important than ever. Docket Navigator recently completed a study of district court decisions on contested motions to stay pending reexamination, IPR and CBM proceedings in the PTO from January 1, 2008 to July 31, 2015. The results of that study are reflected in this report.

NUMBER OF DECISIONS ON MOTIONS TO STAY PENDING REEXAM, IPR and CBM

The overall number of decisions on motions to stay has been steadily climbing since 2011, with the most dramatic increase in between 2013 (with 351 decisions) and 2014 (with 443 decisions). That trend is expected to continue this year, but to a slightly lesser degree.

Stays Pending Reexam, IPR, & CBM (grey segments represent projected data through 12/31/2015, extrapolated from actual data from 1/1/2015 through 7/31/2015)

STAYS BY DISTRICT

The Northern District of California (CAND), the Eastern District of Texas (TXED), and the District of Delaware (DED) all decided a similar number of motions to stay. CAND decided the most overall, and had the highest grant rate, 57%. TXED is the opposite, with only 25% granted and over 67% denied. Delaware granted 55%, denied 38%, and partially granted 7%.

Stays Pending PTAB Proceeding by Court (September 2012-July 2015)

LENGTH AND SCOPE

While the length and scope of stays vary, most stays apply to the entire case and remain in place until the PTAB proceedings have concluded. 92% of stays apply to the entire proceeding, while only 8% apply to specific patent claims or products. 93% of stays apply until the PTAB proceeding is completed while only 7% end at a specific date or event.

Scope and length of stays pending PTAB proceeding (June 2014 - June 2015)

STAGE OF PTAB PROCEEDING

What impact does the stage of the PTAB proceeding have on whether a stay is granted or denied? Most stays were requested when the IPR was at one of two stages: (i) after a petition was filed with the PTAB, but before the PTAB rendered an institution decision (post-filing, pre-institution), and (ii) after the PTAB rendered an institution decision but before the PTAB issued a final written decision (post-institution, pre-FWD). In the first category, the stay decision was almost evenly split: 43% granted, 48% denied, 9% partially granted and denied. Many motions denied at this stage were denied without prejudice to refiling after the institution decision. In the second category, the success rates of motions to stay increased to 64%, with 25% denied, and 11% partially granted and denied. In many post-institution instances where the motion to stay was denied, the court’s reasoning was that the district court case was too far advanced to warrant a stay.

Impact of stage of PTAB proceeding on success of motion (June 2014 - June 2015)

SUCCESS RATE BY JUDGE

Although each case is unique, the data reflects variances in outcomes of motions to stay based on the judge deciding the motion. For example, Judge Sleet has a very high grant rate, but Judge Mitchell and Judge Gilstrap have very high denial rates. Please note: a very limited set of judicial decisions are available due to the relatively narrow time period involved. As with all statistical properties, use caution when extrapolating from such small data sets.

Success rate of motions to stay by judge (September 2012-July 2015)

CONCLUSION

The number of motions for stays is on a steady upward trend. A motion filed after the PTAB has instituted IPR is more likely to succeed than one where the petition has only been filed. But a post-filing motion to stay still has a good chance of being granted. As always, different judges have different inclinations when it comes to granting or denying these motions. The likelihood of getting an entire case stayed is very high, as is the likelihood of having a case stayed until the IPR has concluded.

Though there are obvious fluctuations between individual courts and judges, the overall trend shows that these motions are and will continue to be an important part of the litigation process.