Case 1:18-cv-01950-LPS-CJB Document 15 Filed 03/08/19 Page 1 of 12 PageID #: 809
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF DELAWARE
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`C.A. No. 1:18-cv-01950-LPS-CJB
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`JURY TRIAL DEMANDED
`
`))))))))))
`
`ALIGN TECHNOLOGY, INC.,
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`Plaintiff,
`
`v.
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`3SHAPE A/S,
`3SHAPE TRIOS A/S and
`3SHAPE, INC.
`
`Defendants.
`
`DEFENDANTS’ MEMORANDUM IN SUPPORT OF ITS UNOPPOSED MOTION FOR
`MANDATORY AND DISCRETIONARY STAY PENDING PROCEEDINGS AT THE
`INTERNATIONAL TRADE COMMISSION
`
`Geoffrey Grivner (# 4711)
`BUCHANAN INGERSOLL & ROONEY PC
`919 North Market Street, Suite 1500
`Wilmington, DE 19801
`Telephone No.: (302) 552-4207
`Fax: (302) 552-4200
`Email: geoffrey.grivner@bipc.com
`
`S. Lloyd Smith (admitted pro hac vice)
`Kimberly E. Coghill (admitted pro hac vice)
`BUCHANAN INGERSOLL & ROONEY PC
`1737 King Street, Suite 500
`Alexandria, VA 22314-2727
`Telephone No.: (703) 838-6514
`Fax: (703) 836-2021
`Email: lloyd.smith@bipc.com
`
`

`

`Case 1:18-cv-01950-LPS-CJB Document 15 Filed 03/08/19 Page 2 of 12 PageID #: 810
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`TABLE OF CONTENTS
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`I.
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`II.
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`III.
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`IV.
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`NATURE AND STAGE OF THE PROCEEDINGS ............................................. 3
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`SUMMARY OF ARGUMENT .............................................................................. 4
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`STATEMENT OF FACTS ..................................................................................... 5
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`ARGUMENT.......................................................................................................... 5
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`a.
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`b.
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`c.
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`Applicable Law........................................................................................................5
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`This Action Must be Stayed Pursuant to 28 U.S.C. § 1659(a) for All But
`One Patent at Issue in the Present Action ................................................................6
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`The Claims Related to the ’761 Patent Should be Stayed in the Interest of
`Judicial Efficiency and to Avoid Unnecessarily Burdening the Parties and
`this Court..................................................................................................................7
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`1.
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`
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`2.
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`3.
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`
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`A Stay Will Significantly Simplify the Issues before this Court................ 7
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`Granting the Requested Stay Will Not Prejudice Align ........................... 10
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`The Stage of Proceedings Favors Granting a Stay.................................... 11
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`V.
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`CONCLUSION..................................................................................................... 11
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`2
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`Case 1:18-cv-01950-LPS-CJB Document 15 Filed 03/08/19 Page 3 of 12 PageID #: 811
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`Defendants 3Shape, Inc., 3Shape Trios A/S, and 3Shape A/S (“Defendants” or
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`“3Shape”), by and through their undersigned counsel, hereby submit this brief in support of their
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`motion pursuant to 28 U.S.C. § 1659(a) and the Court’s discretion, to stay this action in its
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`entirety until the below referenced proceeding between the parties before the United States
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`International Trade Commission (“ITC”) become final, including any appeals.
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`I.
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`NATURE AND STAGE OF THE PROCEEDINGS
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`On November 14, 2017, Plaintiff Align Technology Inc. (“Plaintiff” or “Align”)
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`simultaneously filed four patent infringement suits in this District against Defendants, asserting
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`twenty-six patents related to dental technology. See C.A. No. 17-cv-01646; C.A. No. 17-cv-
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`01647; C.A. No. 17-cv-01648; C.A. No. 17-cv-01649.
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`On the same day, Align filed two additional complaints at the International Trade
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`Commission (“ITC”) involving eleven of the twenty-six patents asserted in district court. See
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`ITC Inv. No. 337-TA-1090; ITC Inv. No. 337-TA-1091. Those patents overlapped with eleven
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`of the thirteen patents filed in Civil Action Nos. 17-cv-01648 and 17-cv-01649. As a result, the
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`parties stipulated and this Court agreed that the district court cases in which patents were
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`asserted that overlapped with those asserted in the ITC proceedings should be stayed. See C.A.
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`No. 17-cv-01648, D.I. 19; C.A. No. 17-cv-01649, D.I. 20 (order entered Jan. 23, 2018).
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`Precisely one month after the end of the second hearing of the ITC hearings referenced
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`above, on December 10, 2018, Align filed a third complaint at the ITC, requesting the ITC to
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`institute an investigation based upon alleged infringement of five additional patents: the ’192
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`patent at issue in C.A. No. 17-cv-01646 and four of the five patents at issue in the present action.
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`See ITC Inv. No. 337-TA-1144 (the “1144 Investigation”). The ITC instituted the 1144
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`Investigation on February 27, 2019.
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`3
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`

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`The next day, Align filed two additional patent infringement suits in this District,
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`including the present one asserting four patents overlapping with those at issue in the ITC
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`complaint: United States Patent Nos. 7,077,647 (the “’647 patent”); 7,156,661 (the “’661
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`patent”); 9,848,958 (the “’958 patent”), and 8,102,538 (the “’538 patent”). The complaint in this
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`action additionally referenced a fifth patent, U.S. Patent No. 6,371,761 (the “’761 patent”), not
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`identified in the ITC complaint.
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`Due to the significant interconnection of the patents at issue in this action and ITC Inv.
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`No. 337-TA-1144, discussed in detail below, the proceedings in the ITC will narrow and
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`simplify the issues the present case and serve to conserve resources of both this Court and the
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`parties. Therefore, 3Shape respectfully requests that the Court stay this action for the reasons set
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`forth herein.
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`II.
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`SUMMARY OF ARGUMENT
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`1. By statute, a party is entitled to a mandatory stay in a civil action involving parties that
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`are also parties to a proceeding before the ITC under section 337 of the Tariff Act of 1930 until
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`the determination of the ITC becomes final. Thus, 3Shape is entitled to a stay of the claims of
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`this action which involve patents also asserted in the ITC Investigations.
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`2. This Court considers three factors when deciding whether to grant a discretionary stay:
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`(1) whether a stay will simplify the issues in question and trial of the case; (2) whether a stay
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`would unduly prejudice or present a clear tactical disadvantage to the non-moving party; and (3)
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`the stage of the proceedings. All three factors considered by the Court favor a stay of all this
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`case in its entirety. Further, Align has agreed to not oppose this Motion.
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`3. First, because of the substantial interrelationship, discussed in detail below, between
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`the patents asserted in the ITC Investigations and the patent not asserted, a stay until the ITC
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`Investigations are final will simplify and narrow the issues for trial in this litigation.
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`4
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`4. Second, a stay will not unduly prejudice Align because it is finite in nature.
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`Additionally, Align has not alleged any urgent injury or requested a preliminary injunction and
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`3Shape and a stay will not impair Align’s ability to obtain any damages to which it may be
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`ultimately entitled in the absence of a stay.
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`5. Third, this case is in its infancy. Discovery has not yet begun and this Court has not yet
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`expended significant resources on these cases. At this point, a stay can only serve to prevent the
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`parties and this Court from spending unnecessary time, money and resources on efforts
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`duplicative of those taken in connection with the ITC Investigation.
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`III.
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`STATEMENT OF FACTS
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`As discussed in Section I of this Memorandum, on December 11, 2018, Align filed two
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`patent infringement suits against Defendants in this District each asserting five patents related to
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`dental scanning technology. The day prior, Align filed a complaint with the ITC under Section
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`337 of the Tariff Act of 1930 asserting four patents which overlap with the patents at issue in this
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`litigation.
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`Notably, Align also accuses the same 3Shape products in the complaint in the present
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`action as it does in the complaint filed in the ITC. As described in detail below, this case should
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`be stayed in its entirety while the ITC proceeding is pending in accordance with both the
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`mandatory stay requirement of 28 U.S.C. § 1659(a) and this Court’s discretionary power to stay
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`proceedings in the interest of promoting efficiency in the resolution of this action and conserving
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`judicial resources.
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`IV.
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`ARGUMENT
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`a.
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`Applicable Law
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`Section 1659(a) of Title 28 of the United States Code provides:
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`5
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`Case 1:18-cv-01950-LPS-CJB Document 15 Filed 03/08/19 Page 6 of 12 PageID #: 814
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`In a civil action involving parties that are also parties to a proceeding before the
`United States International Trade Commission under section 337 of the Tariff Act
`of 1930, at the request of a party to the civil action that is also a respondent in the
`proceeding before the Commission, the district court shall stay, until the
`determination of the Commission becomes final, proceedings in the civil action
`with respect to any claim that involves the same issues involved in the proceeding
`before the Commission.
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`The stay of 28 U.S.C. § 1659(a) must be granted if a motion pursuant to that section is made
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`within thirty (30) days of the later of (1) the party being named a respondent in a proceeding
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`before the ITC, or (2) the filing of the district court action. Id.
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`District courts also have the discretionary power to stay litigation under their inherent
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`power to control their own dockets. See Landis v. North Am. Co., 299 U.S. 248, 254-55, 57 S.
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`Ct. 163, 81 L. Ed. 153 (1936).
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`In determining whether to grant a discretionary stay, a court
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`considers: (1) whether a stay would unduly prejudice or present a clear tactical disadvantage to
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`the non-moving party; (2) whether a stay will simplify the issues in question and trial of the case;
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`and (3) whether discovery is complete and whether a trial date has been set. Alloc, Inc. v. Unilin
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`Decor N.V., C.A. No. 03-cv-253, 2003 WL 21640372, at *2 (D. Del. July 11, 2003) (internal
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`quotation marks omitted). “Courts have also referenced undue prejudice or hardship to the
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`movant as a factor to be considered in evaluating a request to stay litigation.” Mission Abstract
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`Data L.L.C. v. Beasley Broadcast Group, Inc., C.A. no. 11-cv-176, 2011 WL 5523315, at *2 (D.
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`Del. Nov. 14, 2011).
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`b.
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`This Action Must be Stayed Pursuant to 28 U.S.C. § 1659(a) for All
`But One Patent at Issue in the Present Action
`
`As stated above, Align has brought claims involving all but the ’761 patent, in both this
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`District and at the ITC. Pursuant to 28 U.S.C. § 1659(a), 3Shape is entitled to a mandatory stay
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`on claims in this District involving the overlapping patents, namely the ’647, ’661, ’958, ’538,
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`patents by virtue of its filing of this Motion within thirty days of being named as a respondent in
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`6
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`Case 1:18-cv-01950-LPS-CJB Document 15 Filed 03/08/19 Page 7 of 12 PageID #: 815
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`the ITC investigation. See 28 U.S.C. § 1659(a)(1); see also Graphic Props. Holdings v. Toshiba
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`Am. Info. Sys., C.A. No.12-213-LPS, 2014 WL 923314 (D. Del. March 5, 2014) (“Because this
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`action and GPH’s ITC investigation involve the same asserted ’327 Patent and appear to involve
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`the same Toshiba and VIZIO products, a stay of this case and of C.A. No. 12-214-LPS is
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`mandated by §1659(a).”).
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`c.
`
`The Claims Related to the ’761 Patent Should be Stayed in the
`Interest of Judicial Efficiency and to Avoid Unnecessarily Burdening
`the Parties and this Court
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`In addition to the mandatory stay with respect to the claims involving the overlapping
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`patents, this Court should exercise its discretionary power to stay the claims of this action
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`involving the ’761 patent, which is not asserted in the ITC, thereby staying this action in its
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`entirety. The reasons for doing so are not complicated. A discretionary stay with respect to the
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`’761 patent serves the interest of reducing unnecessary duplicative time and effort of the parties
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`and this Court, and is consistent with the underlying policy behind the mandatory stay of §1659.
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`The same 3Shape products as those accused of infringing the patents subject to the
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`mandatory stay are also accused of infringing the ’761 patents. Thus, discovery efforts and other
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`pretrial issues related to the claims involving the ’761 patent will be unnecessarily duplicative of
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`discovery on the accused products and the claims at issue in the ITC Investigation. A dual
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`schedule will frustrate the interests of judicial economy, needlessly complicate these cases, and
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`invite “duplicative discovery,” including “two rounds of expert reports, two rounds of dispositive
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`motions, and ultimately, two trials.” Avago Techs. U.S., Inc. v. Iptronics, Inc., C.A. No. 5:10-cv-
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`02863, 2013 WL 623042, at *3 (N.D. Cal. Feb. 15, 2013).
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`1.
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`A Stay Will Significantly Simplify the Issues before this Court
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`Given the similarities in the issues before the ITC and the District Court, a stay in this
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`Action will prevent the Court from engaging in superfluous proceedings and the parties from
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`Case 1:18-cv-01950-LPS-CJB Document 15 Filed 03/08/19 Page 8 of 12 PageID #: 816
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`duplicating efforts in discovery. This Court has recognized that when Congress enacted 28
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`U.S.C. § 1659, it did so with the intent that district courts should additionally consider invoking
`
`their discretionary power to stay patent infringement litigation under circumstances similar to
`
`those discussed herein, where the matters and patents at issue in actions pending before the
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`district court are “related to, but not duplicative of, an action before the ITC.” Zenith Elecs. LLC
`
`v. Sony Corp., No. 11-cv-02439, 2011 WL 2982377, at *2 (N.D. Cal. July 22, 2011). Further, as
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`acknowledged by the Court of Appeals for the Federal Circuit, “[t]he legislative history [of §
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`1659] explains that the ‘use of the Commission record could expedite proceedings and provide
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`useful information to the Court’” thereby simplifying the issues in district court cases on issues
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`related to those considered by the ITC. In re Princo Corp., 478 F.3d 1345, 1355 (Fed. Cir. 2007)
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`(citing H.R. Rep. No. 103-826(I) at 142).
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`The ’761 patent and the issues that will arise during litigation surrounding that patent are
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`closely related to the four patents asserted in the ITC Investigation. For instance, each of the
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`claims related to the five patents asserted in this Action accuse the Trios scanning system of
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`infringing those patents. Further, 3Shape’s Ortho System software is accused of infringing both
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`the ’761 patent and three of the four patents at issue in the ITC Investigation.
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`As such, the record developed in the ITC Investigations will likely include testimony,
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`evidence and findings of fact that will serve to guide this Court in considering the issues
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`involving the claims related to the ’761 patent. Thus, common discovery issues with respect to
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`these products will arise across the five asserted patents in this Action. Because all of the
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`3Shape products accused of infringing the ’761 patent are also accused of infringing at least one
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`of the four patents at issue in the ITC Investigation, discovery and damages related to each call
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`will necessarily impact one another.
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`8
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`Additionally, the underlying subject matter of the ’761 patent is similar to that of the
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`patents asserted in the ITC Investigation. For instance, the Complaint filed in this Action
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`represents that each of the ’647 and ’661 patents, at issue in the ITC Investigation, as well as the
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`’761 patent, describe “systems and devices for improved mapping of dental models.” Dkt. 1, at
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`¶¶ 75, 95, 115. The ’958 patent, also at issue in the ITC Investigation additionally is represented
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`as involving “improved mapping” in the digital dentistry field. Id. at ¶ 53.
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`As a result, the ITC’s interpretation of the claims of the overlapping patents and its
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`evaluation of the operation of the accused products, particularly with respect to the accused
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`functionality, are likely to simplify the issues that this Court must decide in the future. See
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`Avago Techs. U.S., 2008 WL 623042, at *3 (N.D. Cal. Feb. 15, 2013) (“Because the ITC
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`investigation relates to the present case, several issues of proof may stand to be clarified by the
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`ITC’s determination.”). Under these circumstances, a stay promotes efficiency and judicial
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`economy. See Form Factor, Inc. v. Micronics Japan Co., No. 06-cv-07159, 2008 WL 361128, at
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`*4 (N.D. Cal. Feb. 11, 2008) (where the Court acknowledged that although discovery relating to
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`non-overlapping patents would differ from that of patents involved in both the district court and
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`ITC proceedings, the Court would benefit from the opportunity to review the ITC’s view of the
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`technical questions presented with respect to the overlapping patents and determined that “the
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`similarity of the [overlapping and non-overlapping] patents in subject matter is sufficient to
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`warrant staying this matter in order for this Court to gain the additional knowledge of the ITC
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`proceedings”).
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`Further, this Court has recognized that when Congress enacted 28 U.S.C. § 1659, it did so
`
`with the intent that district courts should additionally consider invoking their discretionary power
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`to stay patent infringement litigation under circumstances similar to those discussed herein,
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`9
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`Case 1:18-cv-01950-LPS-CJB Document 15 Filed 03/08/19 Page 10 of 12 PageID #: 818
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`where the matters and patents at issue in actions pending before the district court are “related to,
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`but not duplicative of, an action before the ITC.” Zenith Elecs., 2011 WL 2982377, at *2.
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`As such, to avoid the expenditure of unnecessary time and efforts of the parties and this
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`Court, litigation with respect to all five asserted patents should proceed at the same time.
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`2.
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`Granting the Requested Stay Will Not Prejudice Align
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`The requested stay will not prejudice Align because it is finite. The ITC issued its Notice
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`of Institution of Investigation for the 1144 Investigation on February 27, 2019, and the
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`Commission is mandated by statute to “conclude any such investigation and make its
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`determination…at the earliest practicable time after the date of publication of notice of such
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`investigation.”
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`19 U.S.C. § 1337(b)(1). The Commission strives to complete most
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`investigations within 15 months and expected to set a target date for completion accordingly.
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`See The U.S. International Trade Commission Section 337 Investigations: Answers to Frequently
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`Asked Questions, available at www.usitc.gov/intellectual_property/documents/337_faqs.pdf, p.
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`23. Because the stay request is finite, the Court need not “identify a pressing need for [a] stay.”
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`Sandisk Corp. v. Phison Elecs. Corp., 538 F. Supp. 2d 1060, 1066 (W.D. Wis. 2008) (citing
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`Cherokee Nation v. United States, 124 F.3d 1413, 1416 (Fed. Cir. 1997)).
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`The brief stay means there will be no evidentiary prejudice. This short-term, finite delay
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`simply does not pose the risks of prejudice to warrant proceeding with the present Action.
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`Compare Clinton v. Jones, 520 U.S. 681, 708 (1997) (holding stay lasting up to six years
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`“increase[s] the danger of prejudice resulting from the loss of evidence”); see also Mission
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`Abstract Data LLC v. Beasley Broad. Grp., Inc., C.A. No. 11-cv-176, 2011 WL 5523315, at *4
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`(D. Del. Nov. 11, 2014) (finding a stay would not unduly prejudice the plaintiff and reasoning
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`“[w]hile there is some risk that the passage of time while the reexaminations proceed will lead to
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`stale evidence, faded memories, and lost documents, in the overall circumstances of this case the
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`risk of prejudice…due to the passage of time is not so great as to warrant denial of a stay.”);
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`Apple, Inc., 2011 WL 13141909 at n. 17 (D. Del. Dec. 22, 2011) (plaintiff not prejudiced where
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`it “decided to bring parallel actions in connection with [the asserted patents] in the ITC despite
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`the fact that the filing of complaints in both forums would result in a stay of the [overlapping]
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`case and, potentially, of related cases”).
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`Further, as noted above, Align could have asserted claims against the ’761 patent in other
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`District Court case it initiated on the same day as the present Action, yet chose not to do so.
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`And, Align has agreed not to oppose this Motion. Thus, granting a stay of the entirety of this
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`Action will not prejudice Align.
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`3.
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`The Stage of Proceedings Favors Granting a Stay
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`A stay is appropriate because this case is in its early stage, Defendant’s Answer or other
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`response is not yet due, and discovery has not yet begun. See Graphic Props. 2014 WL 923314,
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`at *3 (D. Del. Mar. 5, 2014) (finding a stay appropriate where “[no] trial date has been set…and
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`discovery is not yet complete”). As such, the parties do not risk losing or stalling any progress
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`made in this Court. These facts support a stay of this Action. See Alloc, Inc. v. Unilin Décor
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`N.V., C.A. No. 03-cv-253, 2003 WL 21640372, at *3 (D. Del. July 11, 2003) (noting that
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`discovery had not yet begun and a discovery scheduled had not been determined in support of a
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`decision to enter a stay “before any party incurs substantial litigation-related expenses”).
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`V.
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`CONCLUSION
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`For at least the foregoing reasons, Defendants respectfully request the Court to enter an
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`order, substantially similar to the proposed form of the Order attached hereto, staying this Case
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`in its entirety as to each of the five claim asserted and all named parties pursuant to 28 U.S.C. §
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`11
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`Case 1:18-cv-01950-LPS-CJB Document 15 Filed 03/08/19 Page 12 of 12 PageID #: 820
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`1659(a) and the Court’s discretionary powers. Furthermore, as set forth in the attached Order,
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`upon dissolution of the stays of this Action, Defendants requests that their answer or response to
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`the Complaint be due on the later of (a) thirty (30) days after the request to lift the stay is made,
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`or (b) ten (10) business days after the stay is actually lifted.
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`Dated: March 8, 2019
`
`/s/ Geoffrey G. Grivner
`Geoffrey Grivner (# 4711)
`BUCHANAN INGERSOLL & ROONEY PC
`919 North Market Street, Suite 1500
`Wilmington, DE 19801
`Telephone No.: (302) 552-4207
`Fax: (302) 552-4200
`Email: geoffrey.grivner@bipc.com
`
`S. Lloyd Smith (pro hac vice pending)
`Kimberly E. Coghill (pro hac vice pending)
`BUCHANAN INGERSOLL & ROONEY PC
`1737 King Street, Suite 500
`Alexandria, VA 22314-2727
`Telephone No.: (703) 838-6514
`Fax: (703) 836-2021
`Email: lloyd.smith@bipc.com
`kimberly.coghill@bipc.com
`
`Attorneys for Defendants
`3Shape A/S, 3Shape Trios A/S
`and 3Shape Inc.
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`12
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`