Case 8:17-cv-00981-JVS-JCG Document 60 Filed 03/05/18 Page 1 of 17 Page ID #:1588
`
`
`
`RUSS AUGUST & KABAT
`Brian D. Ledahl (SBN 186579)
`bledahl@raklaw.com
`Neil A. Rubin (SBN 250761)
`nrubin@raklaw.com
`Jacob R. Buczko (SBN 269408)
`jbuczko@raklaw.com
`Paul A. Kroeger (SBN 229074)
`pkroeger@raklaw.com
`Timothy T. Hsieh (SBN 255953)
`thsieh@raklaw.com
`12424 Wilshire Boulevard, 12FL
`Los Angeles, California 90025
`310/826-7474 – Telephone
`310/826-6991 – Facsimile
`
`Attorneys for Plaintiff
`Document Security Systems, Inc.
`
`
`UNITED STATES DISTRICT COURT
`
`CENTRAL DISTRICT OF CALIFORNIA
`
`
`DOCUMENT SECURITY SYSTEMS,
`INC.,
`
`
`Plaintiff,
`
`
`
`v.
`
`
`SEOUL SEMICONDUCTOR CO., LTD.
`and SEOUL SEMICONDUCTOR, INC.,
`
`
`Defendants.
`
`
` Case No. 8:17-cv-00981-JVS-JCG
`
`PLAINTIFF DOCUMENT
`SECURITY SYSTEMS, INC.’S
`OPPOSITION TO
`DEFENDANTS’ MOTION TO
`STAY PENDING INTER PARTES
`REVIEW
`
`Date: March 26, 2018
`Time: 1:30 p.m.
`Ctrm: 10C
`Judge: Hon. James V. Selna
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`PLAINTIFF’S OPPOSITION TO DEFENDANTS’ MOTION TO STAY
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`Case 8:17-cv-00981-JVS-JCG Document 60 Filed 03/05/18 Page 2 of 17 Page ID #:1589
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`
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`I.
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`II.
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`TABLE OF CONTENTS
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`INTRODUCTION .......................................................................................... 1
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`LEGAL STANDARD..................................................................................... 2
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`III. ARGUMENT .................................................................................................. 4
`
`A.
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`B.
`
`C.
`
`The Status of the Litigation Weighs Against a Stay ............................. 4
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`Simplification of Issues is Speculative at Best ..................................... 5
`
`A Stay Would Unduly Prejudice DSS .................................................. 8
`
`1. A stay would inflict unfair tactical benefits to Seoul ................... 8
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`2. A stay would diminish DSS’s eventual recovery ......................... 9
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`3. A stay hurts DSS’s interest in timely enforcement of its
`rights ..................................................................................................... 9
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`4. A stay will deny DSS its chosen forum ...................................... 11
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`IV. CONCLUSION ............................................................................................. 12
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`TABLE OF CONTENTS
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`Case 8:17-cv-00981-JVS-JCG Document 60 Filed 03/05/18 Page 3 of 17 Page ID #:1590
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`
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`TABLE OF AUTHORITIES
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`Cases
`
`Allure Energy, Inc. v. Nest Labs, Inc.,
`No. 13-cv-102, D.I. 190 (E.D. Tex. Apr. 2, 2015) ................................. 11, 12
`
`Avago Tech. Fiber IP (Singapore) Pte. Ltd. v. IPtronics Inc.,
`2011 WL 3267768 (N.D. Cal. July 28, 2011)................................................. 8
`
`C.W. Zumbiel Co. v. Kappos,
`2012 U.S. App. LEXIS 26554 (Fed. Cir. Dec. 27, 2012) ............................. 10
`
`Carl. Zeiss A.G. v. Nikon Corp.,
`Case No. 2:17-cv-03221-RGK (MRWx) Feb. 9, 2018 at 4 ............................ 3
`
`Clouding IP LLC v. SAP AG, et al.,
`Case No. 13-01456-LPS, D.I. 35 (D. Del. Jan. 21, 2014) ........................ 5, 12
`
`Comcast Cable Comms. Corp. v. Finisar Corp.,
`2007 U.S. Dist. LEXIS 103309 (N.D. Cal. Apr. 5, 2007) .............................. 3
`
`Cooper Notification, Inc. v. Twitter, Inc.,
`2010 U.S. Dist. LEXIS 131385 (D. Del. Dec. 13, 2010) ......................... 5, 11
`
`Davol, Inc. v. Atrium Med. Corp.,
`2013 U.S. Dist. LEXIS 84533 (D. Del. June 17, 2013) ................................ 10
`
`Drink Tanks Corp. v. Growlerwerks, Inc.,
`2016 WL 3844209 (D. Or. July 15, 2016) ...................................................... 7
`
`Fresenius USA, Inc. v. Baxter Int’l, Inc.,
`582 F.3d 1288 (Fed. Cir. 2009) .................................................................. 3, 8
`
`Fresenius USA, Inc. v. Baxter Int’l, Inc.,
`721 F.3d 1330 (Fed. Cir. 2013) ...................................................................... 8
`
`In re Swanson,
`540 F.3d 1368 (Fed. Cir. 2008) ...................................................................... 8
`
`Lennon Image Technologies, LLC v. Macy's Retail Holdings, Inc.,
`No. 2:13-CV-00235-JRG, 2014 WL 4652117 (E.D. Tex. Sept. 18, 2014) .. 10
`
`LG Elecs., Inc. v. Eastman Kodak Co.,
`2009 U.S. Dist. LEXIS 44056 (S.D. Cal. May 26, 2009) ............................. 10
`
`Netlist, Inc. v. Smart Storage Sys. Inc.,
`2014 WL 4145412 (N.D. Cal. Aug. 21, 2014) ........................................... 3, 7
`
`NFC Tech. LLC v. HTC Am., Inc.,
`No. 2:13-CV-1058-WCB, 2015 WL 1069111 (E.D. Tex. Mar. 11, 2015) ..... 6
`ii
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`TABLE OF AUTHORITIES
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`RUSS, AUGUST & KABAT
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`Case 8:17-cv-00981-JVS-JCG Document 60 Filed 03/05/18 Page 4 of 17 Page ID #:1591
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`
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`Otto Bock HealthCare LP v. Össur HF,
`2013 U.S. Dist. LEXIS 188428 (C.D. Cal. Dec. 16, 2013) ............................ 6
`
`Polaris Innovations Ltd. v. Kingston Tech. Co., Inc.,
`Case No. 8:16-cv-00300-CJC (RAOx) Nov. 17, 2016 ................................... 3
`
`Rensselaer Polytechnic Inst. v. Apple Inc.,
`2014 WL 201965 (N.D.N.Y. Jan. 15, 2014) ................................................... 7
`
`SAGE Electrochromics, Inc. v. View, Inc.,
`2015 WL 66415 (N.D. Cal. Jan. 5, 2015) ....................................................... 7
`
`Softview LLC v. Apple et al.,
`2012 U.S. Dist. LEXIS 104677 (D. Del. July 26, 2012) .......................... 4, 12
`
`SoftView LLC v. Apple Inc.,
`No. 10–cv–389–LPS, 2012 WL 3061027 (D. Del. July 26, 2012) ............... 10
`
`St. Clair Intellectual Prop. Consultants, Inc. v. Fujifilm Holdings Corp.,
`2009 U.S. Dist. LEXIS 5457 (D. Del. Jan. 27, 2009) ..................................... 6
`
`TC Heartland LLC v. Kraft Foods Group Brands LLC,
`137 S. Ct. 1514 (2017) .................................................................................... 4
`
`The California Inst. Of Tech. v. Broadcom Ltd.,
`Case No. 2:16-cv-3714-GW (AGRx) Mar. 2, 2017 ....................................... 3
`
`Trover Grp., Inc. v. Dedicated Micros USA,
`2015 WL 1069179 (E.D. Tex. Mar. 11, 2015) ............................................... 9
`
`Twin Rivers Eng’g., Inc. v. Fieldpiece Inst., Inc.,
`Case No. 2:16-cv-04502-BRO (MRWx) Jan. 19, 2017 .................................. 3
`
`Universal Elec., Inc. v. Universal Remote Control,
`943 F. Supp. 2d 1028 (C.D. Cal. 2013) ................................................ 3, 5, 10
`
`Unwired Planet, LLC v. Square, Inc.,
`2014 WL 4966033 (D. Nev. Oct. 3, 2014) ..................................................... 7
`
`Verinata Health, Inc. v. Ariosa Diagnostics, Inc.,
`No. C 12-05501 SI, 2014 WL 121640 (N.D. Cal. Jan. 13, 2014) ............ 2, 10
`
`Visteon Global Techs., Inc. v. Garmin Int’l, Inc.,
`2013 U.S. Dist. LEXIS 14912 (E.D. Mich. Feb. 4, 2013) .............................. 8
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`Statutes
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`35 U.S.C. § 316(a)(11) ...................................................................................... 10, 11
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`TABLE OF AUTHORITIES
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`RUSS, AUGUST & KABAT
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`Case 8:17-cv-00981-JVS-JCG Document 60 Filed 03/05/18 Page 5 of 17 Page ID #:1592
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`Plaintiff Document Security Systems, Inc. (“DSS”) opposes Defendants Seoul
`
`Semiconductor Co., Ltd.’s and Seoul Semiconductor, Inc.’s (collectively, “Seoul”)
`
`motion (Dkt. 57) to stay pending inter partes review (“IPR”).
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`I.
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`INTRODUCTION
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`Courts in this District consider three factors in evaluating a request for stay:
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`the stage of the proceedings; the extent to which a stay will simplify the issues; and
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`the potential prejudice to the non-moving party. These three factors weigh against
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`a stay here.
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`First, the stage of the proceedings does not warrant a stay. The parties have
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`already exchanged both infringement and invalidity contentions, propounded
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`discovery, and are beginning the claim construction process. The parties carefully
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`negotiated, and the Court already issued, a Case Schedule. A stay would undo the
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`efforts of the parties and the Court thus far. Further, the Court has already had
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`occasion to consider issues relating to the merits of this case in light of Defendants’
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`previous motions to dismiss. Additionally, Seoul waited nearly eight months after
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`first being sued on the patents-in-suit to file its first IPR petition, and then nearly 3
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`months after filing that first IPR petition, and more than a month after filing its last
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`IPR petition, before requesting a stay.
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`Second, a stay would not simplify issues. Seoul’s IPR petitions were filed
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`within the last two to three months and the PTAB will not issue rulings even on
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`instituting those IPRs for another three to four months. Any purported simplification
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`is entirely speculative. Further, as Seoul recognizes in its motion, the IPR petitions
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`do not cover all of the patents asserted in the related cases pending before this Court,
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`nor are they joined by all of the parties in the related cases. This Court will still have
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`to adjudicate issues of claim construction as to the three patents asserted against
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`Seoul, even if the stay were granted, because those same patents are asserted against
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`other defendants who have not filed IPRs, nor moved for a stay. This Court is the
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`only forum that can resolve all the issues between the parties, including
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`PLAINTIFF’S OPPOSITION TO DEFENDANTS’ MOTION TO STAY
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`RUSS, AUGUST & KABAT
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`Case 8:17-cv-00981-JVS-JCG Document 60 Filed 03/05/18 Page 6 of 17 Page ID #:1593
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`infringement, damages, and numerous other issues (e.g., affirmative defenses) that
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`are not before the PTAB and cannot be simplified even if there is a stay.
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`Finally, a stay will inflict unnecessary prejudice on DSS. It will deny DSS its
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`chosen forum—this Court—and force DSS to defend its patents exclusively in the
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`forum chosen by Seoul—the Patent Trial and Appeal Board (“PTAB”)—through
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`their IPR petitions submitted after this litigation was filed. Further, Seoul’s requested
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`stay would also serve to create tactical disadvantage as the requested stay would
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`affect only Seoul. Thus, even if granted, proceedings, including claim construction
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`proceedings, would continue as to other defendants against whom the same patents
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`are asserted. Seoul essentially seeks a second bite at the apple by trying to defer its
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`involvement in claim construction. Further, this Court has already set limits on
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`claim construction proceedings for this case, including a limit of twelve terms for
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`construction. Seoul apparently seeks to evade this limit by suggesting that the Court
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`and the parties should conduct a second, separate, claim construction proceeding just
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`for Seoul. This unnecessary duplication is prejudicial both to the Court and to DSS.
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`Additionally, although Seoul suggests that delay is not prejudicial because DSS and
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`Seoul do not compete in the patented technology. But DSS will still suffer prejudice
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`from delay because a money judgment would be delayed and Seoul has not stipulated
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`that any judgment in this case would be subject to prejudgment interest. Thus, delay
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`would effectively diminish the value of any recovery. These various forms of
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`prejudice counsel strongly against a stay.
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`II. LEGAL STANDARD
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`A decision to stay litigation is within the sound discretion of the Court, and
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`“There is no per se rule that patent cases should be stayed pending reexaminations,
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`because such a rule ‘would invite parties to unilaterally derail’ litigation.” Verinata
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`Health, Inc. v. Ariosa Diagnostics, Inc., No. C 12-05501 SI, 2014 WL 121640, at *2
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`(N.D. Cal. Jan. 13, 2014); Universal Elec., Inc. v. Universal Remote Control, 943 F.
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`PLAINTIFF’S OPPOSITION TO DEFENDANTS’ MOTION TO STAY
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`Case 8:17-cv-00981-JVS-JCG Document 60 Filed 03/05/18 Page 7 of 17 Page ID #:1594
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`Supp. 2d 1028, 1030-31 (C.D. Cal. 2013) (“[c]ourts are not required to stay judicial
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`proceedings pending re-examination of a patent.”).
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`Requests to stay pending an IPR petition that has not yet even been instituted
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`by the PTAB (like the request here) are generally disfavored in courts of this District.
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`See, e.g., The California Inst. Of Tech. v. Broadcom Ltd., Case No. 2:16-cv-3714-
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`GW (AGRx), Order of Mar. 2, 2017 at 3-4; Carl. Zeiss A.G. v. Nikon Corp., Case
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`No. 2:17-cv-03221-RGK (MRWx) at 4, Order of Feb. 9, 2018 at 4 (citing Netlist,
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`Inc. v. Smart Storage Sys. Inc., 2014 WL 4145412, at *3 (N.D. Cal. Aug. 21, 2014));
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`Twin Rivers Eng’g., Inc. v. Fieldpiece Inst., Inc., Case No. 2:16-cv-04502-BRO
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`(MRWx), Order of Jan. 19, 2017; Polaris Innovations Ltd. v. Kingston Tech. Co.,
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`Inc., Case No. 8:16-cv-00300-CJC (RAOx), Order of Nov. 17, 2016.
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`If such a stay was “routinely available to delay the judicial resolution of
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`disputes, the procedure is subject to inequity, if not manipulation and abuse, through
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`the delays that are inherent in PTO activity.” Fresenius USA, Inc. v. Baxter Int’l,
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`Inc., 582 F.3d 1288, 1305 (Fed. Cir. 2009) (Newman J., concurring). “If litigation
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`were stayed every time a claim in suit undergoes reexamination, federal
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`infringement actions would be dogged by fits and starts.” Comcast Cable Comms.
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`Corp. v. Finisar Corp., 2007 U.S. Dist. LEXIS 103309, *4-5 (N.D. Cal. Apr. 5,
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`2007). “Federal court calendars should not be hijacked in this manner.” Id.
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`In determining whether to stay litigation, courts in this District consider three
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`factors: “(1) whether discovery is complete and whether a trial date has been set; (2)
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`whether a stay will simplify the issues in question and trial of the case; and (3)
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`whether the stay would unduly prejudice or present a clear tactical disadvantage to
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`the non-moving party.” Universal Elec., 943 F. Supp. 2d at 1030-31. A stay of this
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`litigation would be unjustified in view of the three factors. This Court’s inquiry also
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`may consider the totality of the circumstances in assessing a request for a stay. Id.
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`at 1031. Here, the totality of circumstances also weighs heavily against a stay.
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`PLAINTIFF’S OPPOSITION TO DEFENDANTS’ MOTION TO STAY
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`Case 8:17-cv-00981-JVS-JCG Document 60 Filed 03/05/18 Page 8 of 17 Page ID #:1595
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`III. ARGUMENT
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`A. The Status of the Litigation Weighs Against a Stay
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`This case is not in its infancy. This case has been pending in this Court since
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`June 8, 2017. Seoul suggests that it quickly filed its IPR petitions within
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`approximately 6-7 months of the case being filed. Seoul’s assertion is, however,
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`misleading. In fact, DSS initially filed its infringement complaint against Seoul in
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`the U.S. District Court for the Eastern District of Texas in April, 2017. After the
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`Supreme Court issued its ruling regarding patent venue in TC Heartland LLC v.
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`Kraft Foods Group Brands LLC, 137 S. Ct. 1514 (2017), DSS voluntarily dismissed
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`and re-filed the case in this Court. Thus, Seoul in fact waited approximately eight
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`months after initially being sued before filing the first of its three IPR petitions. Even
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`after bringing that first IPR petition, Seoul then waited nearly three more months
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`before filing its request for a stay. See Carl Zeiss A.G., supra, at 3-4 (finding that
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`the first factor weighed against a stay where defendant filed an IPR petition seven
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`months after an initial complaint and delayed 1 month after petition before filing
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`motion to stay).
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`Significant resources have already been expended in this case. For example,
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`DSS has already litigated two motions to dismiss brought by Seoul, and the Court
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`has had to familiarize itself with the merits of the case in considering those motions.
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`See Softview LLC v. Apple et al., 2012 U.S. Dist. LEXIS 104677, *12 (D. Del. July
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`26, 2012) (“Substantial time and resources have been devoted in this case to
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`scheduling…as well as Defendants’ motions to…dismiss.”). DSS also served
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`detailed infringement contentions to all defendants in each of the five coordinated
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`cases last year. The coordinated defendants have also served invalidity contentions
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`over a month ago. Discovery is well under way, and all parties have produced at
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`least some documents. The exchange of claim terms for construction is less than
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`three weeks away, which necessarily involves substantial work in developing claim
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`construction positions. The claim construction hearing is also likely to take place
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`PLAINTIFF’S OPPOSITION TO DEFENDANTS’ MOTION TO STAY
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`RUSS, AUGUST & KABAT
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`

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`Case 8:17-cv-00981-JVS-JCG Document 60 Filed 03/05/18 Page 9 of 17 Page ID #:1596
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`before the PTAB decides whether or not to even grant Seoul’s petitions. See, e.g.,
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`Universal Elec., 943 F. Supp. 2d at 1031 (“The Court’s expenditure of resources is
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`an important factor in evaluating the stage of the proceedings.”); Polaris, supra at 4
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`(finding a stay was unwarranted where the parties had exchanged written discovery
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`and the Court had resolved a motion for judgment on the pleadings).
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`Accordingly, the status of the case weighs against a stay. See, e.g., Clouding
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`IP LLC v. SAP AG, et al., Case No. 13-01456-LPS, D.I. 35 (D. Del. Jan. 21, 2014)
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`(“[T]he Court has devoted substantial resources to working out a coordinated
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`schedule (which has been entered today) of the 13 related cases”); Cooper
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`Notification, Inc. v. Twitter, Inc., 2010 U.S. Dist. LEXIS 131385, *10 (D. Del. Dec.
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`13, 2010) (“Scheduling all of these matters is a challenge. In the instant case, in
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`particular, significant resources were devoted to formulating a schedule.”).
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`The fact that the Court and the parties have already expended meaningful
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`resources on this case causes the first factor to weigh against a stay.
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`B.
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`Simplification of Issues is Speculative at Best
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`This factor strongly weighs against a stay. No other defendants have joined
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`in Seoul’s IPR petitions or motion to stay. As such, regardless of whether a stay is
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`granted for Seoul, this case will proceed for the non-moving defendants according
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`to the set discovery, claim construction, pretrial, and trial dates. Seoul suggests that
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`if its motion is granted, the Court and the parties will avoid the time and resources
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`involved in claim construction. This is not true. Seoul ignores the fact that this case
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`is one of several coordinated cases. DSS, the Court, and all other defendants would
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`move forward with claim construction even if a stay was granted. The stay would
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`not simplify proceedings for the Court, nor for DSS. In fact, Seoul seems to suggest
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`that the stay would actually multiply proceedings. This Court has already set limits
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`on claim construction across the coordinated proceedings, limiting all parties to a
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`total of twelve terms for construction across the patents-in-suit. If a stay were
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`granted, DSS and the other defendants would still proceed with construction of
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`5
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`PLAINTIFF’S OPPOSITION TO DEFENDANTS’ MOTION TO STAY
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`RUSS, AUGUST & KABAT
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`

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`Case 8:17-cv-00981-JVS-JCG Document 60 Filed 03/05/18 Page 10 of 17 Page ID #:1597
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`twelve terms. But Seoul seems to suggest that after a stay was lifted, it could then
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`pursue still more terms for claim construction later – unnecessarily increasing the
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`work for both the Court and DSS.
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`However, denial of a stay would simplify issues for all parties and this Court.
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`Denial of a stay would allow all defendants in all five actions to continue to
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`coordinate on the numerous overlapping issues, e.g., claim construction, invalidity,
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`discovery, and pretrial issues. Similarly, only denial of a stay would allow DSS and
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`this Court to spend scarce resources in a single proceeding, rather than two, in
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`addressing these overlapping issues. Staying the case for Seoul will only result in
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`procedural complexities, such as duplicative discovery and pretrial efforts by the
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`parties and the Court. See, e.g., St. Clair Intellectual Prop. Consultants, Inc. v.
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`Fujifilm Holdings Corp., 2009 U.S. Dist. LEXIS 5457, *7-8 (D. Del. Jan. 27, 2009)
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`(“[A] stay of this action will disrupt the coordinated discovery planned for the
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`pending cases, resulting in the likelihood of duplicative discovery and/or pretrial
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`efforts by the parties and the Court.”)
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`Seoul’s assertion of simplification is also pure speculation. The PTAB has yet
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`to decide whether to institute any of Seoul’s IPR petitions as to any claims. The
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`institution decisions are not due for another three to four months. “‘[S]tay of a patent
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`infringement action is not warranted when based on nothing more than the fact that
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`a petition for inter partes review was filed in the [Patent Office].’” Otto Bock
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`HealthCare LP v. Össur HF, 2013 U.S. Dist. LEXIS 188428, at *4-5 (C.D. Cal. Dec.
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`16, 2013); NFC Tech. LLC v. HTC Am., Inc., No. 2:13-CV-1058-WCB, 2015 WL
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`1069111, at *4 (E.D. Tex. Mar. 11, 2015) (“While the PTAB's decision to institute
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`inter partes review ordinarily means that there is a substantial likelihood of
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`simplification of the district court litigation, that likelihood is far more speculative
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`before the PTAB decides whether to institute inter partes review. For that reason,
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`the grant of inter partes review has been treated as a highly significant factor in the
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`courts’ determination of whether to stay cases pending PTAB review.”). Multiple
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`6
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`PLAINTIFF’S OPPOSITION TO DEFENDANTS’ MOTION TO STAY
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`RUSS, AUGUST & KABAT
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`

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`Case 8:17-cv-00981-JVS-JCG Document 60 Filed 03/05/18 Page 11 of 17 Page ID #:1598
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`courts in this District have concluded that any possible simplification from a not-yet
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`instituted IPR petition is too speculative to support a stay as discussed in Section II,
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`above.1
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`In short, Seoul’s argument—that significant judicial resources could be saved
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`“if” their Petitions are granted and “if” some or all claims are canceled—is
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`demonstrably based on speculation of events that have yet to take place and may
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`never take place at all. To grant a stay based on this argument “would invite parties
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`to unilaterally derail timely patent case resolution by seeking reexamination and not
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`promote the efficient and timely resolution of patent cases.”
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`Seoul’s argument that “DSS’s IPR history instructs that it is highly likely that
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`the PTAB will invalidate asserted claims,” is without merit. Seoul’s only support for
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`this argument are IPR decisions against a plaintiff not named in this case, in past
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`litigation unrelated to this case, and on patents completely unrelated to those at issue
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`in this case. Rather, statistics published by the PTAB for the Fiscal Year January
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`2018 show that of the 8,067 total filed petitions, only 1,270 have resulted with all
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`claims being found unpatentable, and only an additional 309 have resulted in some
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`claims being found unpatentable. This results in only 19.6% of all petitions filed.
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`Ex. A.
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`Moreover, the litigation before this Court is the only forum that can resolve
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`all of the issues—including infringement, validity, and damages—between DSS and
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`Seoul. A decision by the USPTO alone cannot nullify a decision by this Court. See,
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`1 The majority of courts in other districts similarly deny a motion to stay as premature
`if the PTAB has not yet granted a petition for review. See, e.g., Drink Tanks Corp.
`v. Growlerwerks, Inc., 2016 WL 3844209, at *11 (D. Or. July 15, 2016); e.g., Trover
`Grp., Inc. v. Dedicated Micros USA, 2015 WL 1069179, at *1 (E.D. Tex. Mar. 11,
`2015); SAGE Electrochromics, Inc. v. View, Inc., 2015 WL 66415, at *5 (N.D. Cal.
`Jan. 5, 2015); Rensselaer Polytechnic Inst. v. Apple Inc., 2014 WL 201965, at *1
`(N.D.N.Y. Jan. 15, 2014); Unwired Planet, LLC v. Square, Inc., 2014 WL 4966033,
`at *5-6 (D. Nev. Oct. 3, 2014); Netlist, Inc. v. Smart Storage Sys., Inc., 2014 WL
`4145412, at *3 (N.D. Cal. Aug. 21, 2014).
`7
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`PLAINTIFF’S OPPOSITION TO DEFENDANTS’ MOTION TO STAY
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`RUSS, AUGUST & KABAT
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`

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`Case 8:17-cv-00981-JVS-JCG Document 60 Filed 03/05/18 Page 12 of 17 Page ID #:1599
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`e.g., In re Swanson, 540 F.3d 1368, 1379, fn.5 (Fed. Cir. 2008) (“[A]n attempt to
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`reopen a final federal court judgment of infringement on the basis of a reexamination
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`finding of invalidity might raise constitutional problems.”). Further, this litigation
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`will likely conclude before IPR proceedings, as the PTAB would be expected to
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`issue final decisions (even if any IPR proceedings are later instituted) only after this
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`case has already been tried. The Court should reject delay in favor of a just and
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`speedy determination before this Court that would resolve all of the parties’ issues.
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`See also, e.g., Fresenius USA, Inc. v. Baxter Int’l, Inc., 582 F.3d 1288, 1305 (Fed.
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`Cir. 2009) (Newman, J. concurring) (“Our colleague in concurrence appears to
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`believe that a PTO decision on reexamination will override a judicial decision
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`reached after trial and appeal. That is incorrect. All that can be accomplished is
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`delay.”); Fresenius USA, Inc. v. Baxter Int’l, Inc., 721 F.3d 1330, 1340 (Fed. Cir.
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`2013) (“[U]nder ‘well-established principles of res judicata,’ the cancellation of a
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`patent’s claims cannot be used to reopen a final damages judgment ending a suit
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`based on those claims.”).
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`Even if the Court believes that the PTAB’s decision would be timely and
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`helpful, the Court need not stay these cases to realize the benefits of the PTAB
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`proceedings. The Court could “incorporat[e] any final claim decisions that might
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`issue from the USPTO in the process…[and] see the case through a speedy
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`adjudication on the merits.” Visteon Global Techs., Inc. v. Garmin Int’l, Inc., 2013
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`U.S. Dist. LEXIS 14912, *13 (E.D. Mich. Feb. 4, 2013). As such, “staying the case
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`until the reexaminations finish is not necessary to realize the benefits of the PTO
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`proceedings.” Id. (quoting Avago Tech. Fiber IP (Singapore) Pte. Ltd. v. IPtronics
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`Inc., 2011 WL 3267768, at *6 (N.D. Cal. July 28, 2011)). A stay is unwarranted and
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`should be denied.
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`C. A Stay Would Unduly Prejudice DSS
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`1.
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`A stay would inflict unfair tactical benefits to Seoul
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`RUSS, AUGUST & KABAT
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`8
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`PLAINTIFF’S OPPOSITION TO DEFENDANTS’ MOTION TO STAY
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`

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`Case 8:17-cv-00981-JVS-JCG Document 60 Filed 03/05/18 Page 13 of 17 Page ID #:1600
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`As noted previously, claim construction proceedings in related coordinated
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`cases will go forward, even if a stay is granted. Thus, the Court will conduct claim
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`construction proceedings on the same patents at issue against Seoul. Seoul seeks,
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`through its stay request, a tactical benefit of taking a “wait and see” approach to
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`claim construction. It would allow other parties and DSS to pursue claim
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`construction before the Court, and then only after having the benefit of the Court’s
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`rulings on those issues, seek to burden DSS and the Court with additional claim
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`construction issues. Seoul should not be able to use the mere fact of filing IPR
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`petitions as a means to obtain such a tactical advantage and unfairly prejudice DSS.
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`2.
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`A stay would diminish DSS’s eventual recovery
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`Seoul argues that because it does not compete directly with DSS, DSS will
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`suffer no prejudice from a stay. This is not true. DSS seeks damages for
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`infringement in the form of a reasonable royalty. Seoul will undoubtedly argue that
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`the amount of such a royalty is no different whether awarded in 2018, 2019, or 2020
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`(at least for infringement that occurred before the time of judgment). But this would
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`deprive DSS of the time value of its judgment. Pre-judgment interest is one possible
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`way to compensate for such delay, but Seoul has not suggested that it will stipulate
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`to prejudgment interest on any eventual verdict in this case. Indeed, it seems more
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`likely that Seoul will seek to contest the availability of such interest. At a minimum,
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`DSS faces uncertainty that it will be fairly compensated for the delay in any eventual
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`judgment. Thus, a stay would unfairly prejudice DSS.;
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`3.
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`A stay hurts DSS’s interest in timely enforcement of its
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`rights
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`A stay will unduly prejudice DSS because DSS has a recognized interest in
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`the timely enforcement of its patent rights. Trover Grp., Inc., No. 2:13-CV-1047-
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`WCB, 2015 WL 1069179, at *2 (E.D. Tex. Mar. 11, 2015) (“the plaintiffs' claim of
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`prejudice is entitled to consideration, as is the general right of patent owners to
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`timely enforcement of their patent rights”); Lennon Image Technologies, LLC v.
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`9
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`PLAINTIFF’S OPPOSITION TO DEFENDANTS’ MOTION TO STAY
`
`RUSS, AUGUST & KABAT
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`

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`Case 8:17-cv-00981-JVS-JCG Document 60 Filed 03/05/18 Page 14 of 17 Page ID #:1601
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`Macy's Retail Holdings, Inc., No. 2:13-CV-00235-JRG, 2014 WL 4652117, at *2
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`(E.D. Tex. Sept. 18, 2014) (“Turning to the first factor, the Court acknowledges that
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`a patent holder has ‘an interest in the timely enforcement of its patent right.’”).
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`The prejudice and tactical disadvantage DSS would suffer is especially
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`significant here, where Seoul’s IPR petitions have not even been granted, and the
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`decision is not expected for another three to four months. See, e.g., Davol, Inc. v.
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`Atrium Med. Corp., 2013 U.S. Dist. LEXIS 84533, *6-7 (D. Del. June 17, 2013)
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`(“[T]he status of the inter partes review is cause for some concern…The PTO has
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`not yet decided whether to grant [the IPR] petitions…[S]uch a delay risks
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`unnecessarily impairing [plaintiff] Davol’s patent rights, and finds that this sub-
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`factor weighs against granting a stay.”) If PTAB decides to institute the IPRs, it has
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`a year to issue a final determination, which may be extended by 6 months. 35 U.S.C.
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`§ 316(a)(11). As such, the PTAB’s decision on these are due no earlier than one to
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`three months after the scheduled trial date of June 18, 2019 in this litigation. The
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`delay could be further exacerbated if the petitioners invoke their right to appeal the
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`PTAB’s decision to the Federal Circuit. See, e.g., Universal Elec., 943 F. Supp. 2d
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`at 1033 (“There could be a two year delay, even before any appellate proceedings
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`that will likely arise out of the inter partes review.”); C.W. Zumbiel Co. v. Kappos,
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`2012 U.S. App. LEXIS 26554 (Fed. Cir. Dec. 27, 2012) (affirming a 23-month old
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`BPAI reexamination decision); Verinata Health, 2014 U.S. Dist. LEXIS 4025, *8-9
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`(“[E]ven under the new procedures, it may still be years before the inter partes
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`review is truly final” because the PTAB’s decision “is still subject to appeal.”).
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`Further, a stay risks the loss of evidence while the inter partes review is
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`pending, as “resuming litigation after a protracted stay could raise issues with sta