Plaintiff Ecolab Inc. (“Ecolab”) filed a patent infringement action alleging that Gurtler infringed Ecolab’s patent for “SANITIZING LAUNDRY SOUR,” United States Patent No. 6,262,013 (the “‘013 Patent”). Gurtler subsequently filed a Request for Ex Parte Reexamination of the ‘013 Patent. Gurtler then filed a motion to stay and the United States Patent and Trademark Office (“PTO”) granted Gurtler’s Request for Ex Parte Reexamination of all claims of the ‘013 Patent.
In support of its motion to stay and lack of prejudice to Gurtler, Gurtler argued that Ecolab tactically delayed serving its complaint for four months, which demonstrates that “time is not of the essence” to Ecolab. Additionally, Gurtler argued that because the case was in the early stages of discovery, there was no prejudice to Ecolab. Ecolab argued it will be unduly prejudiced because it is one of Gurtler’s direct competitors, its ability to litigate its claims will suffer, and because Gurtler delayed in seeking reexamination.
The district court found that the stay would unduly prejudice Ecolab. “Although Ecolab delayed in serving its complaint, it did so to engage in settlement negotiations. . . . Additionally, Ecolab asserts it is a competitor of Gurtler, and Gurtler does not dispute this assertion. (Id. at 2, 6-7). This fact weighs in favor of finding prejudice to Ecolab. See Order Dated Apr. 10, 2012, Medtronic, Inc. v. Edwards Lifesciences Corp., Civil No. 11-1650 (JNE/JSM) [Doc. No. 63 at 4] (“Medtronic Order”) (stating that a stay will prejudice plaintiff ‘in light of the anticipated length of the reexaminations and the competition between [the parties]’).”
Furthermore, as explained by the district court, “[t]he risk of prejudice is compounded by the relatively long period of time required to complete ex parte reexamination.” TPK Touch Solutions, Inc. v. Wintek Electro-Optics Corp., Case No. 13-cv-02218-JST, 2013 WL 5289015, at *3 (N.D. Cal. Sept. 18, 2013). Ecolab argues that its patent expires in 2019, and a delay for ex parte examination means “Gurtler will essentially receive a compulsory license throughout the remaining life of the patent” and it will be more difficult for Ecolab to litigate its claims. (Ecolab’s Mem. in Opp’n at 7-9). While the timing of the reexamination is speculative, the PTO’s statistics suggest that ex parte reexamination alone takes, on average, 27.8 months, to say nothing of related appeals. (Id. at 6); see also (Ex Parte Reexamination Filing Data–Sept. 30, 2013, Ex. A, Attached to Decl. of Jamie R. Kurtz, “Kurtz Decl.”) [Doc. No. 31-1]. And although Gurtler had the option of seeking inter partes review, which must be concluded within a year, it chose not to. (Ecolab’s Mem. in Opp’n at 4) (citing 35 U.S.C. § 316(a)(11)). If the PTO takes the average amount of time to complete its ex parte review, it would not be complete until April 2017. This delay would unduly prejudice Ecolab because its injunctive relief would be truncated, and it would potentially lose valuable time to procure evidence. See Medtronic Order at 4 (concluding that a stay would prejudice plaintiff due, in part, to “the time that passed from the issuance of the patents-in-suit to this action’s commencement”); Ever Win Int’l Corp., 902 F. Supp. 2d at 509 (noting that “[p]otential delay from reexamination does not, by itself, amount to undue prejudice” but “PTO reexaminations can result in lengthy delays, which can hinder a plaintiff’s ability to obtain timely resolution regarding its allegations of patent infringement” (internal quotation marks omitted)).
Accordingly, the district court denied the motion to stay pending the ex parte reexamination by the patent office.
Ecolab Inc. v. Gurtler Chemicals, Inc., Case No. 14-496 (JNE/SER) (D. Minn. March 3, 2015)
The authors of www.PatentLawyerBlog.com are patent trial lawyers at Jeffer Mangels Butler & Mitchell LLP. For more information about this case, contact Stan Gibson at 310.201.3548 or SGibson@jmbm.com.