Opinion
Case No. 1:16-cv-21761-KMM
07-09-2020
PRISUA ENGINEERING CORP., Plaintiff, v. SAMSUNG ELECTRONICS CO., LTD., et al., Defendants.
Amy Michelle Bowers, Juan Jose Rodriguez, Carey Rodriguez Milian Gonya, LLP, Ernesto Miguel Rubi, Royal Caribbean Cruises Ltd., John C. Carey, Carey Rodriguez Greenberg O'Keefe LLP, Miami, FL, for Plaintiff. Jennifer A. Surprenant, Pro Hac Vice, Richard A. Edlin, Pro Hac Vice, Greenberg Traurig, LLP, New York, NY, Mark G. Davis, Pro Hac Vice, Minsoo Kim, Pro Hac Vice, Ronald John Pabis, Stephen K. Shahida, Pro Hac Vice, Greenberg Traurig LLP, Washington, DC, Patrick J. McCarthy, Pro Hac Vice, Greenberg Traurig, LLP, Wasington, DC, David A. Coulson, Greenberg Traurig, Miami, FL, for Defendants.
Amy Michelle Bowers, Juan Jose Rodriguez, Carey Rodriguez Milian Gonya, LLP, Ernesto Miguel Rubi, Royal Caribbean Cruises Ltd., John C. Carey, Carey Rodriguez Greenberg O'Keefe LLP, Miami, FL, for Plaintiff.
Jennifer A. Surprenant, Pro Hac Vice, Richard A. Edlin, Pro Hac Vice, Greenberg Traurig, LLP, New York, NY, Mark G. Davis, Pro Hac Vice, Minsoo Kim, Pro Hac Vice, Ronald John Pabis, Stephen K. Shahida, Pro Hac Vice, Greenberg Traurig LLP, Washington, DC, Patrick J. McCarthy, Pro Hac Vice, Greenberg Traurig, LLP, Wasington, DC, David A. Coulson, Greenberg Traurig, Miami, FL, for Defendants.
ORDER
K. MICHAEL MOORE, CHIEF UNITED STATES DISTRICT JUDGE THIS CAUSE came before the Court upon Plaintiff Prisua Engineering Corp.’s ("Plaintiff") Motion to Lift Stay. ("Mot.") (ECF No. 387). Samsung Electronics Co., Ltd., Samsung Electronics America, Inc., and Samsung Electronics Latinoamerica Miami, Inc. (collectively, "Defendants") filed a response in opposition. ("Resp.") (ECF No. 388). Plaintiff filed a reply. ("Reply") (ECF No. 389). The Motion is now ripe for review.
The Court has set forth the background and pertinent facts of the matter in several prior orders. See, e.g. , ECF Nos. 56, 103, 268, 275. In the interest of brevity, the Court recites only facts that are relevant to the motions at hand.
This dispute concerns U.S. Patent No. 8,650,591 ("the '591 Patent"), granted by the United States Patent and Trademark Office ("USPTO") on February 11, 2014 to Dr. Yolanda Prieto, the founder, president, and sole shareholder of Plaintiff. ("Summ. J. Order") (ECF No. 275) at 2. On May 17, 2016, Plaintiff filed the instant action, pursuant to 35 U.S.C. § 271, alleging that certain of Defendants’ products infringed Claims 1, 3, 4, and 8 of the '591 Patent. ("Compl.") (ECF No. 1). The case proceeded to trial, and the jury returned a verdict in Plaintiff's favor, finding that the asserted claims of the '591 Patent are not invalid, and that Defendants willfully infringed the asserted claims. Jury Verdict (ECF No. 325). Following the jury's verdict, Plaintiff filed a Motion for Award of Prejudgment Interest, (ECF No. 332), and a Motion for Enhanced Damages, (ECF No. 334). Defendants filed a Motion for Judgment as a Matter of Law ("JMOL"), or in the alternative, for New Trial. (ECF Nos. 345, 357).
Following the jury trial but prior to the entry of final judgment, the Patent Trial and Appeal Board ("PTAB") agreed to review the validity of the asserted claims at issue in this case. ("PTAB Order") (ECF No. 364–3) at 3. In response, this Court stayed all proceedings in this case pending the PTAB's decision. ("Stay Order") (ECF No. 368). On October 2, 2018, Plaintiff notified the Court that the PTAB rendered a decision, which stated that Defendants have "not shown by a preponderance of the evidence that claims 1–4 and 8 are unpatentable." Plaintiff Notice (ECF No. 371); ("PTAB Order") (ECF No. 371–1) at 2, 22. Defendants appealed the PTAB Order's conclusion as to Claims 1–4 and 8, and Plaintiff cross-appealed the PTAB Order's invalidation of Claim 11. See Samsung Elecs. Am. v. Prisua Eng'g Corp. , 948 F.3d 1342, 1345 (Fed. Cir. 2020).
In light of the PTAB decision, on October 12, 2018, Defendants filed a Motion to Continue Stay and on October 26, 2018, Plaintiff filed a Counter-Motion to Reopen Case. (ECF Nos. 372, 374). On July 11, 2019, the Court granted Defendants’ Motion to Continue Stay and denied Plaintiff's Counter-Motion to Reopen Case, staying the case pending the conclusion of the appeal. (ECF No. 384) at 7–8.
On February 4, 2020, the Court of Appeals for Federal Circuit rendered a decision in the appeal. (ECF Nos. 386–1, 387–1). On appeal, Defendants argued that the PTAB should have canceled Claims 1–4 and 8 for indefiniteness, or in the alternative, the PTAB should have assessed whether they would have been anticipated or obvious in view of the cited prior art. Samsung Elecs. Am. , 948 F.3d at 1345. Plaintiff cross-appealed from the PTAB's ruling that Claim 11 was unpatentable for obviousness. Id.
The Federal Circuit addressed all three issues on appeal. First, the Federal Circuit held that the PTAB properly declined to cancel Claims 1–4 and 8 for indefiniteness because the PTAB lacks authority in an inter partes review to cancel claims on that basis. See id. at 1350–53 ; see also 35 U.S.C. § 311(b). Second, the Federal Circuit held that the PTAB erred in not determining whether, despite that Claims 1–4 and 8 were indefinite, the PTAB could nonetheless apply the prior art to Claim 1 and its dependent claims for purposes of anticipation or obviousness analysis. Samsung Elecs. Am. , 948 F.3d at 1353–55. Third, the court held that the PTAB correctly concluded that Claim 11 was obvious. Id. at 1355–59. Accordingly, the court affirmed in part and reversed in part the PTAB's decision and remanded the case. Id. at 1359. The Federal Circuit instructed that "[o]n remand, the [PTAB] should address Samsung's argument that the [PTAB] may analyze the patentability of a claim even if that claim is indefinite[.]" Id. at 1355. Further, the court directed the PTAB to "determine whether claim 1 and its dependent claims are unpatentable as anticipated or obvious based on the instituted grounds." Id.
On March 5, 2020, Plaintiff petitioned the Federal Circuit for rehearing en banc , which the Federal Circuit denied on April 7, 2020. (ECF No. 390).
In light of the Federal Circuit's decision, Plaintiff now moves the Court to lift the stay. See Mot.
II. LEGAL STANDARD
"The decision whether to grant a stay is committed to the district court's sound discretion, and the court is ‘given considerable leeway in the exercise of its judgment.’ " Bos. Sci. Corp. v. Cook Grp. Inc. , No. 1:17-cv-03448-JRS-MJD, 2019 WL 2511162, at *1 (S.D. Ind. June 17, 2019) (citing Ultratec, Inc. v. CaptionCall, LLC , 611 F. App'x. 720, 721–23 (Fed. Cir. 2015) ). "When ruling on a motion to stay pending the resolution of a related case in another forum, district courts must consider both the scope of the stay and the reasons given for the stay." Lipford v. Carnival Corp. , 346 F. Supp. 2d 1276, 1278 (S.D. Fla. 2004). "The moving party bears the burden of demonstrating that a stay is appropriate." Friends of the Everglades v. United States , No. 08-21785-CIV-ALTONAGA/Brown, 2008 WL 11410108, at *2 (S.D. Fla. Nov. 7, 2008).
III. DISCUSSION
Plaintiff argues that (1) extending the stay would "severely prejudice" Plaintiff; (2) the proceedings are "far beyond an advanced stage"; (3) a stay will not simplify the issues; and (4) totality of circumstances and interests of justice warrant lifting the stay. See Mot. at 5–12. In response, Defendants argue that the balance of factors now tips even further in favor of staying the litigation until the proceedings before the PTAB on remand have concluded. Resp. at 2.
District courts have typically weighed the following factors in deciding whether a stay is appropriate: (1) the stage of the litigation; (2) undue prejudice to the nonmoving party; and (3) simplification of the issues in question. See, e.g. , Personal Audio LLC v. Google, Inc. , 230 F. Supp. 3d 623, 626 (E.D. Tex. 2017) ; Acqis, LLC v. EMC Corp. , No. 14-cv-13560, 2016 WL 4250245, at *2 (D. Mass. Aug. 10, 2016). Courts also "consider whether the totality of the circumstances and the interests of justice favor a stay." Cook Grp. , 2019 WL 2511162, at *1 (internal quotation marks omitted) (citing Universal Elecs., Inc. v. Universal Remote Control, Inc. , 943 F. Supp. 2d 1028, 1035 (C.D. Cal. 2013) ).
Neither Plaintiff nor Defendants object to the Court's application of this standard.
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A. Stage of the Litigation
First, the instant proceedings are without a doubt in an advanced stage. See Juno Therapeutics, Inc. v. Kite Pharma , No. CV 17-07639 SJO (RAOx), 2018 WL 1470594, at *6 (C.D. Cal. Mar. 8, 2018) (stating that where "no significant discovery or trial preparation has taken place" and no substantial expense and time has been invested by the parties, courts typically find that this factor weighs in favor of granting a stay). However, "while the late stage of litigation usually warrants lifting a stay," this factor does not necessarily weigh in favor of lifting a stay because of the "increased risk of inconsistent rulings if the stay is lifted." See Cook Grp. , 2019 WL 2511162, at *3 (holding that although the proceedings were in an advanced stage, this factor weighed in favor of a stay pending appeal because of the potential risk of an inconsistent ruling with the Federal Circuit). Here, the jury found that the asserted claims of the '591 Patent are not invalid. See Jury Verdict. However, upon remand from the Federal Circuit, the PTAB is instructed to "determine whether claim 1 and its dependent claims are unpatentable as anticipated or obvious based on the instituted grounds." Samsung Elecs. Am. , 948 F.3d at 1355. Therefore, the PTAB may find that the asserted claims are invalid, in contradiction to the jury's finding. Accordingly, the Court finds that despite the advanced stage of the litigation, this factor weighs slightly in favor of continuing the stay because of the potential for inconsistent rulings.
B. Prejudice to the Non-Moving Party
Second, a stay is unlikely to materially prejudice Plaintiff because Plaintiff and Defendants are not direct competitors, and a "mere delay in the litigation does not establish undue prejudice." See Juno , 2018 WL 1470594, at *8 (internal citations, quotation marks, and alterations omitted) (citing cases stating that delay in the litigation does not establish undue prejudice and that "prejudice to the patentee is heightened when parties to litigation are direct competitors"). Unlike Juno , Plaintiff does not argue that a stay "could realistically result in a prolonged period of competition between" the Parties. See id. Therefore, any delay Plaintiff suffers as a result of the remand is not undue. Further, the Court observes that the Federal Circuit mandate issued on April 14, 2020. Samsung Elecs. Am. v. Prisua Eng'g Corp. , No. 19-1169 (Fed. Cir. Apr. 14, 2020), ECF No. 57; see also (ECF No. 390). Therefore, the PTAB should issue a decision on the remand by October 14, 2020, approximately three months from the date of this Order. See PATENT TRIAL AND APPEAL BOARD , Standard Operating Procedure 9 ("The [PTAB] has established a goal to issue decisions on remanded cases within six months of the [PTAB's] receipt of the Federal Circuit's mandate."). Accordingly, this factor weights in favor of maintaining the stay.
C. Simplification of the Issues
Third, the issues in the instant proceeding are likely to be simplified by a continued stay. Here, the exact claims at issue (Claims 1, 3, 4, and 8) are the subject of the remand inter partes review, and Defendants are challenging these claims as unpatentable as anticipated or obvious based on the instituted grounds. Because the PTAB's decision could eliminate all or some of the asserted patent claims, it would be complicated and potentially wasteful for the Court to adjudicate the post-trial motions while the PTAB decided the remand inter partes review. See Target Therapeutics, Inc. v. SciMed Life Sys., Inc. , No. C-94-20775, 1995 WL 20470, at *2 (N.D. Cal. Jan. 13, 1995). ("[W]aiting for the outcome of the [inter partes review] could eliminate the need for trial if the claims are cancelled or, if the claims survive, facilitate trial by providing the court with expert opinion of the PTO and clarifying the scope of the claims."). And, if Plaintiff is successful in defending the inter parties review, Defendants will be estopped from challenging the validity of the '591 Patent in this action based on obviousness or any other ground it could have reasonably raised during the inter partes review. See 35 U.S.C. § 315(e)(2) ; Automatic Mfg. Sys., Inc. v. Primera Tech., Inc. , No. 6:12–cv–1727–Orl–37DAB, 2013 WL 6133763, at *3 (M.D. Fla. Nov. 21, 2013) ("Even if the [PTAB] does not invalidate the # 884 Patent in its entirety, the potential for partial invalidation, the review's collateral estoppel effects, and the [PTAB]’s interpretation of the claims will likely narrow the issues and aid the Court as this action progresses."). Therefore, waiting for the PTAB's remand decision would likely streamline the case and post-trial motions. Accordingly, this factor weighs in favor of continuing the stay.
D. Totality of the Circumstances
Finally, considering the "totality of the circumstances," the Court finds that a continued stay pending the outcome of the remand to the PTAB is appropriate. Although the case is at an advanced stage, the potential for inconsistent rulings combined with the lack of undue prejudice and likelihood of simplifying the issues in this case provide compelling reasons to maintain the stay.
IV. CONCLUSION
Accordingly, UPON CONSIDERATION of the Motion, the pertinent portions of the record, and being otherwise fully advised in the premises, it is hereby ORDERED AND ADJUDGED that Plaintiff's Motion to Lift Stay (ECF No. 387) is DENIED. This case remains STAYED. The Parties are instructed to notify the Court within seven (7) days of the PTAB's ruling on the remand at issue.
DONE AND ORDERED in Chambers at Miami, Florida, this 9th day of July, 2020.