United States District Court, N.D. California
IN RE KONINKLIJKE PHILIPS PATENT LITIGATION This Document Relates To ALL ACTIONS
ORDER GRANTING MICROSOFT'S MOTION TO STAY
'064 CLAIMS RE: DKT. NO. 656
HAYWOOD S GILLIAM, JR. UNITED STATES DISTRICT JUDGE
before the Court is Microsoft's motion to stay all claims
and counterclaims relating to U.S. Patent No. 7, 184, 064
(the “'064 Patent”), pending a decision from
the Federal Circuit on the Patent Trial & Appeal
Board's (“PTAB's”) invalidation of all
claims of U.S. Patent No. 6, 690, 387 (the “'387
Patent”). Dkt. No. 656 (“Mot.”) After
carefully considering the parties' arguments, the Court
GRANTS Microsoft's motion.
Koninklijke Philips N.V. and U.S. Philips Corp.
(collectively, “Philips”) instituted this patent
infringement action in December 2015, alleging infringement
of eleven patents. In November 2016, Microsoft intervened in
the actions against several of the Defendants, and Philips
counterclaimed against Microsoft for infringement of nine of
the patents-in-suit. Dkt. Nos. 69, 86. Two of the patents
asserted against Microsoft are the '064 Patent and the
'387 Patent, which are directed to techniques for
scrolling content on a touch screen. Mot. at 3. The '064
Patent is a continuation of the '387 Patent. Id.
April 10, 2019, after an inter partes review
(“IPR”), the PTAB issued a Final Written Decision
finding all claims in the '387 Patent unpatentable based
on obviousness over certain prior art. Dkt. No. 656-2, Ex. A.
Philips then stipulated to dismiss without prejudice its
infringement claims under the '387 Patent. Dkt. Nos. 649,
650. According to Microsoft, Philips has indicated that it
intends to appeal the PTAB's decision invaliding the
'387 Patent. Mot. at 2. Microsoft now moves to stay all
claims and counterclaims for the related '064 Patent
until the Federal Circuit affirms or reverses the PTAB's
decision. See generally Mot. In the alternative,
Microsoft seeks leave to file an early motion for summary
have inherent power to manage their dockets and stay
proceedings, including the authority to order a stay pending
conclusion of [PTO proceedings].” Ethicon, Inc. v.
Quigg, 849 F.2d 1422, 1426-27 (Fed. Cir. 1988)
(citations omitted); IXI Mobile (R & D) Ltd. v.
Samsung Elecs. Co., No. 15-cv-03752-HSG, 2015 WL
7015415, at *2 (N.D. Cal. Nov. 12, 2015). Courts consider
three factors in determining whether to grant a stay pending
PTO proceedings: “(1) whether discovery is complete and
whether a trial date has been set; (2) whether a stay will
simplify the issues in question and trial of the case; and
(3) whether a stay would unduly prejudice or present a clear
tactical disadvantage to the non-moving party.” IXI
Mobile (R & D) Ltd., 2015 WL 7015415, at *2 (quoting
Evolutionary Intelligence, LLC v. Facebook, Inc.,
No. 13-cv-04202-SI, 2014 WL 261837, at *1 (N.D. Cal. Jan. 23,
2014)). The moving party bears the burden of demonstrating
that a stay is appropriate. DSS Tech. Mgmt., Inc. v.
Apple, Inc., No. 14-cv-05330-HSG, 2015 WL 1967878, at *2
(N.D. Cal. May 1, 2015). Whether to stay is always within the
Stage of Proceedings
considering whether to grant a stay, courts consider whether
the litigation is at an early stage. See AT&T
Intellectual Property I v. Tivo, Inc., 774 F.Supp.2d
1049, 1052 (N.D. Cal. 2011). Specifically, courts consider
“whether discovery is complete and whether a trial date
has been set.” Evolutionary Intelligence, 2014
WL 261837, at *1.
argues that a stay is not warranted because fact discovery is
complete and trial is set for February 2020. Dkt. No. 659
(“Opp.”) at 20. In addition, Philips asserts that
a partial stay is inefficient because, to the extent the
'064 Patent will need to be tried again later, the Court
would be “burdened with a second trial.”
Id. at 21. The Court does not doubt the parties have
already expended significant resources on this litigation,
but does not find that the case is so far advanced that a
partial stay is unwarranted. The hearing on the parties'
dispositive and Daubert motions is not until
November 27, 2019, and the pretrial conference is
approximately three months away. See Dkt. Nos. 631,
922. Given the substantial work that still must be done in
this case for the other patents-in-suit, the Court finds that
this factor weighs slightly in favor of a stay.
Simplification of Issues
contends that because the claims of the '387 and '064
Patent are nearly identical, a decision by the Federal
Circuit affirming the invalidity of the '387 Patent would
“conclusively establish” the invalidity of the
'064 Patent, simplifying the issues in this case. Mot. at
6-11. Philips appears to concede that the claims are nearly
identical, but disputes the preclusive effect a decision on
the '387 Patent would have on the '064 Patent. Opp.
at 4, 6-20.
Court finds that this factor weighs in favor of a stay. At
this time, the Court need not conclusively decide whether the
Federal Circuit's affirmance of the invalidity of the
'387 Patent would have a preclusive effect on the
'064 Patent. However, the Court finds persuasive the
reasoning of Judge Saris of the District of Massachusetts,
who held that “PTAB decisions have a
collateral-estoppel effect in district court on unadjudicated
claims that do not ‘materially alter the question of
invalidity.'” See Intellectual Ventures I, LLC
v. Lenovo Grp. Ltd., 370 F.Supp.3d 251, 253 (D. Mass.
2019). Because there is some potential that collateral
estoppel would apply, this case may well be greatly
simplified after the Federal Circuit rules on the PTAB's
invalidation of the '387 Patent, given its similarities
to the '064 Patent. If the Federal Circuit reverses the
PTAB's decision invalidating the '387 ...