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District Court Denies Motion to Stay Pending Inter Partes Review as “Toss Up”

The Boeing Company (“Boeing”) filed a motion to stay pending inter partes review” (“IPR”) after Boeing had requested that the United States Patent and Trademark Office (“PTO”) conduct an inter partes review of U.S. Patent No. RE39,618 (“the ‘618 patent”). Boeing argued that the asserted claims of the ‘618 patent were unpatentable and sought a stay of the case until the PTO decided whether to accept review and determines the patentability of the challenged claims.

The district court noted that it has broad discretion to manage its docket, including the inherent power to grant a stay pending agency review. Procter & Gamble Co. v. Kraft Foods Global, Inc., 549 F.3d 842, 849 (Fed. Cir. 2008). When determining whether to grant a stay, courts generally consider three factors: 1) whether a stay will simplify the issues in question; 2) the stage of litigation, i.e., whether discovery is complete and whether a trial date has been set; and 3) whether a stay would unduly prejudice the non-moving party. Zillow, Inc. v. Trulia, Inc., C12-1549JLR, 2013 WL 5530573, at *3 (W.D. Wash. Oct. 7, 2013); Nat’l Prods., Inc. v. Gamber-Johnson LLC, C12-840RSL, 2012 WL 3527938, at *1 (W.D. Wash. Aug. 14, 2012).

In terms of the first prong, simplification of the issues, the district court found that “[b]ecause the PTO has not yet determined whether to conduct an inter partes review of the ‘618 patent, there is a significant chance that a review will never occur. A stay at this point, then, may have no salutary effects and would simply delay the litigation. The percentages offered by defendant do not better its argument. A 67% chance that review will be granted combined with a 79% chance that the review will be favorable to defendant is not much better than a toss-up. At this stage, the Court cannot find that a stay is likely to result in a simplification of the issues.”

The district court then found that the stage of the litigation weighed in favor of a stay. “Despite the passage of ten months since the case was originally filed in the Northern District of Illinois, it is still in the early stages of litigation. This factor weighs heavily in favor of granting a stay to conserve resources and to avoid the risk of wasted effort and/or inconsistent determinations. Avocent Redmond Corp. v. Rose Elecs., Inc., C06-1711MJP, 2008 WL 3875869, at * (W.D. Wash. Aug. 18, 2008). However, because the PTO has not yet agreed to review the claims of the ‘618 patent, there is no pending proceedings that may be duplicative or would render this litigation unnecessary. Consequently, this factor weighs less heavily in favor of defendant than it otherwise would.”

Turning to the prejudice prong, the plaintiff argued that he would be prejudiced by a stay because, at his advanced age, any delay in the resolution of the case would be problematic. The district rejected this reasoning but once again focused on the stage of proceedings at the PTO. “But the validity of the ‘618 patent is at issue and will have to be resolved in one forum or another. Plaintiff does not explain why deferring to the PTO’s expertise for resolution of these matters would cause prejudice when litigating the same issues in two different proceedings would not. Again, however, the PTO has not yet agreed to determine validity, making it hard to justify any delay that might be caused by a stay. The fact that the litigants do not compete in the same market also reduces the likelihood of prejudice: any alleged infringement would not result in a loss in market share or an erosion of goodwill and can be remedied through a damage award.”

Accordingly, the district court denied the motion to stay.

Seymour Levine v. The Boeing Company, Case No. 14-1991 RSL (July 29, 2015)

The authors of are patent trial lawyers at Jeffer Mangels Butler & Mitchell LLP. For more information about this case, contact Stan Gibson at 310.201.3548 or