Case 2:22-md-03034-TGB ECF No. 148, PageID.10672 Filed 06/07/23 Page 1 of 34
`
`UNITED STATES DISTRICT COURT
`EASTERN DISTRICT OF MICHIGAN SOUTHERN DIVISION
`
`
`Case No. 2:22-md-03034-TGB
`
`In Re: Neo Wireless, LLC,
`Patent Litigation
`
`
`Neo Wireless, LLC, v.
`Ford Motor Company
`Neo Wireless, LLC, v.
`American Honda Motor Co., Inc., et al.
`
`Neo Wireless, LLC, v.
`Volkswagen Group of America, Inc. et
`al.
`
`Neo Wireless, LLC, v.
`Nissan North America Inc. et al.
`
`Neo Wireless, LLC, v.
`Toyota Motor Corporation et al.
`
`Neo Wireless, LLC, v.
`General Motors Company et al.
`
`Neo Wireless, LLC, v.
`Tesla Inc.
`
`Neo Wireless, LLC, v.
`Mercedes-Benz USA, LLC
`
`Neo Wireless, LLC, v.
`FCA US LLC
`
` Hon. Terrence G. Berg
`
`2:22-CV-11402-TGB
`
`2:22-CV-11403-TGB
`
`2:22-CV-11404-TGB
`
`
`
`2:22-CV-11405-TGB
`
`2:22-CV-11406-TGB
`
`2:22-CV-11407-TGB
`
`2:22-CV-11408-TGB
`
`2:22-CV-11769-TGB
`
`2:22-CV-11770-TGB
`
`
`NEO WIRELESS, LLC’S RESPONSE TO DEFENDANTS’
`MOTION TO STAY
`
`
`
`

`

`Case 2:22-md-03034-TGB ECF No. 148, PageID.10673 Filed 06/07/23 Page 2 of 34
`
`TABLE OF CONTENTS
`
`
`STATEMENT OF ISSUE PRESENTED ................................................................ vi
`CONTROLLING OR MOST APPROPRIATE AUTHORITY ............................. vii
`I.
`BACKGROUND .............................................................................................. 1
`II. LEGAL STANDARD ....................................................................................... 6
`III. ARGUMENT .................................................................................................... 7
`A. The Stage of the Case Does Not Justify a Stay. ............................................. 7
`1. Significant Progress Has Been Made in Claim Construction,
`Discovery, and Settlement. ....................................................................... 8
`2. The MDL Proceeding Makes a Stay Particularly Inappropriate. ............ 11
`B. A Stay Will Complicate, Not Simplify, the Issues. ..................................... 14
`1. Defendants’ IPRs Are Unlikely to Simplify Issues Because of the
`Strength of Neo’s Patents. ....................................................................... 15
`2. Defendants’ Projected Simplification is One-Sided. .............................. 17
`3. The IPR Proceedings Will Not Simplify Any Defenses Outside of
`35 U.S.C. §§ 102 or 103. ......................................................................... 18
`C. Defendants’ Dilatory Motives in Staggering the IPRs and Scheme to
`Gain an Unjust Tactical Advantage, Severely Prejudice Neo. .................... 19
`D. Alternatively, the Court Should Deny the Motion as Premature. ................ 24
`IV. CONCLUSION ............................................................................................... 25
`
`
`
`
`
`
`
`
`i
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`

`

`Case 2:22-md-03034-TGB ECF No. 148, PageID.10674 Filed 06/07/23 Page 3 of 34
`
`TABLE OF AUTHORITIES
`
`Cases
`
`Amazon.com, Inc. v. Barnesandnoble.com, Inc.
` 239 F.3d 1343 (Fed. Cir. 2001) ............................................................................ 16
`
`American Home Products Corp. v. Lockwood Mfg. Co.
` 483 F.2d 1120 (6th Cir. 1973) .............................................................................. 20
`
`CAO Lighting, Inc. v. General Electric Company
` C.A. No. 20-681-GBW, C.A. No. 20-690-GBW, No. 2022 WL 17752270
`(D. Del. Dec. 19, 2022) ........................................................................................ 19
`
`
`Card-Monroe Corp. v. Tuftco Corp.
` No. 1:14-cv-292, 2015 WL 11109362 (E.D. Tenn. Feb. 19, 2015) ....................... 7
`
`Carl Zeiss A.G. v. Nikon Corp.
` No. 2:17-CV-07083-RGK-MRW, 2018 WL 5081479
`(C.D. Cal. Oct. 16, 2018) ...................................................................................... 19
`
`
`Cequent Performance Products, Inc. v. Hopkins Mfg. Corp.
` No. 13-cv-15293, 2015 WL 1510671 (E.D. Mich. April 1, 2015) ...................... 15
`
`Dell Inc. et al v. Neo Wireless LLC
` IPR2021-01468, Paper 12 (PTAB March 14, 2022) ............................................ 16
`
`Dell Inc. et al v. Neo Wireless LLC
` IPR2021-01480, Paper 11 (PTAB March 16, 2022) ............................................ 16
`
`Dell Inc. et al v. Neo Wireless LLC
` IPR2021-01486, Paper 10 (PTAB March 16, 2022) ............................................ 16
`
`Dell Inc. et al v. Neo Wireless LLC
` IPR2022-00277, Paper 12 (PTAB June 21, 2022) ............................................... 16
`
`Eagle View Technologies, Inc. v. Xactware Solutions, Inc.
` No. 15-7025 (RBK/JS), 2016 WL 7165695 (D.N.J. Dec. 7, 2016) ..................... 22
`
`
`
`ii
`
`

`

`Case 2:22-md-03034-TGB ECF No. 148, PageID.10675 Filed 06/07/23 Page 4 of 34
`
`Ethicon LLC v. Intuitive Surgical, Inc.
` C.A. No. 17-871-LPS, 2019 WL 1276029 (D. Del. March 20, 2019) ................... 7
`
`Everlight Electronics Co., Ltd. v. Nichia Corp.
` No. 12-cv-11758, 2013 WL 1821512 (E.D. Mich. April 30, 2013) ...................... 6
`
`General Motors LLC et al v. Neo Wireless LLC
` IPR2023-00962, Paper 4 (PTAB June 5, 2023) ................................................... 25
`
`General Motors LLC et al v. Neo Wireless LLC
` IPR2023-00963, Paper 4 (PTAB June 5, 2023) ................................................... 25
`
`General Motors LLC et al v. Neo Wireless LLC
` IPR2023-00964, Paper 3 (PTAB June 5, 2023) ................................................... 25
`
`Indiana State Police Pension Trust v. Chrysler LLC
` 129 S.Ct. 2275 (2009) ............................................................................................ 6
`
`Interwoven, Inc. v. Vertical Computer Systems, Inc.
` No. C 10-04645 RS, 2012 WL 761692 (N.D. Cal. March 8, 2012) .................... 18
`
`Intuitive Surgical, Inc. v. Ethicon LLC
` 25 F.4th 1035 (Fed. Cir. 2022) ............................................................................. 22
`
`Kahn v. GMC
` 889 F.2d 1078 (Fed. Cir. 1989) ............................................................................ 19
`
`Kirsch Research and Development, LLC v. Tarco Specialty Products, Inc. ...............
` 6:20-cv-00318, 2021 WL 4555804 (W.D. Tex. Oct. 4, 2021) ............................. 15
`
`Norgren Automation Solution, LLC v. PHD, Inc.
` No. 14-cv-13400, 2015 WL 1245942 (E.D. Mich. March 18, 2015) .................. 19
`
`Orbital Australia Pty v. Daimler AG
` No. 15-CV-12398, 2015 WL 5439774 (E.D. Mich. Sept. 15, 2015) ................... 20
`
`Pipe Restoration Technologies, LLC v. Pipeline Restoration Plumbing, Inc.
` No.: SACV 13-00499-CJC (RNBx), 2015 WL 13918253
`(C.D. Cal. Feb. 13, 2015) ..................................................................................... 20
`
`
`
`iii
`
`

`

`Case 2:22-md-03034-TGB ECF No. 148, PageID.10676 Filed 06/07/23 Page 5 of 34
`
`Regents of Univ. of Michigan v. St. Jude Med., Inc.
` No. 12-12908, 2013 WL 239340 (E.D. Mich. May 31, 2013) ............................... 7
`
`SAS Inst., Inc. v. Complement, LLC
` 825 F.3d 1341 (Fed. Cir. 2016) ............................................................................ 22
`
`Signal IP, Inc. v. Fiat U.S.A., Inc.
` No. 14-cv-13864, 2015 WL 5719670 (E.D. Mich. Sept. 30, 2015) .......... 7, 12, 18
`
`Signal IP, Inc. v. Ford Motor Co.
` No. 14-cv-13864, 2015 WL 5719671 (E.D. Mich. Sept. 20, 2015) ................ 6, 17
`
`SkyHawke Techs., LLC v. Deca Int’l Corp.
` 828 F.3d 1373 (Fed. Cir. 2016) ............................................................................ 14
`
`Sonrai Memory Limited v. LG Electronics Inc.
` No. 6:21-cv-00168-ADA, 2022 WL 2307475 (W.D. Tex. June 27, 2022) ......... 18
`
`VirnetX Inc. v. Apple Inc.
` No. 6:12-CV-008550RWS, 2018 WL 398433 (E.D. Tex. Jan. 12, 2018) ........... 17
`
`Visteon Global Technologies, Inc. v. Garmin Intern., Inc.
` No. 10-cv-10578, 2013 WL 434135 (E.D. Mich. Feb. 4, 2013) .......................... 18
`
`Volkswagen Group of America, Inc. v. Neo Wireless LLC
` IPR2022-01538, Paper 7 (PTAB May 5, 2023) ................................................... 15
`
`Volkswagen Group of America, Inc. v. Neo Wireless LLC
` IPR2023-00086, Paper 2 (PTAB Oct. 28, 2022) .................................................. 24
`
`XMTT, Inc. v. Intel Corp.
` No. 18-1810, 2022 WL 2904308 (D. Del. July 22, 2022) ................................... 13
`
`Statutes
`
`35 U.S.C. § 101 ................................................................................................. 18, 19
`
`35 U.S.C. § 102 ........................................................................................................ 18
`
`
`iv
`
`

`

`Case 2:22-md-03034-TGB ECF No. 148, PageID.10677 Filed 06/07/23 Page 6 of 34
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`35 U.S.C. § 103 ........................................................................................................ 18
`
`35 U.S.C. § 311(b) ................................................................................................... 18
`
`35 U.S.C. § 315(e)(1) ............................................................................................... 22
`
`35 U.S.C. § 315(e)(2) ............................................................................................... 17
`
`
`
`
`
`
`v
`
`

`

`Case 2:22-md-03034-TGB ECF No. 148, PageID.10678 Filed 06/07/23 Page 7 of 34
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`STATEMENT OF ISSUE PRESENTED
`Issue Presented: The Court should deny a stay pending IPR if it unduly prejudices
`
`the non-movant, provides a tactical advantage to the movant, fails to adequately
`
`simplify issues, and disrupts the stage of proceedings. See Signal IP, Inc. v. Ford
`
`Motor Co., 2015 WL 5719671, at *2 – 6 E.D. Mich. Sept. 20, 2015). Defendants’
`
`stay request, after initiating a staggering dilatory IPR scheme, seeks to manipulate
`
`the MDL procedures to circumvent IPR estoppel, complicate issues, and frustrate
`
`the already-expended resources. Should the Court deny Defendants’ stay request?
`
`
`
`Answer: Yes, the Court should deny Defendants’ Motion to Stay.
`
`vi
`
`

`

`Case 2:22-md-03034-TGB ECF No. 148, PageID.10679 Filed 06/07/23 Page 8 of 34
`
`CONTROLLING OR MOST APPROPRIATE AUTHORITY
`1. Amazon.com, Inc. v. Barnesandnoble.com, Inc., 239 F.3d 1343 (Fed. Cir.
`2001)
`
`2. SkyHawke Techs., LLC v. Deca Int’l Corp., 828 F.3d 1373 (Fed. Cir. 2016)
`
`3. Norgren Automation Solution, LLC v. PHD, Inc., Civil Action No. 14-cv-
`13400, 2015 WL 1245942 (E.D. Mich. March 18, 2015)
`
`4. Signal IP, Inc. v. Fiat U.S.A., Inc., Case No. 14-cv-13864, 2015 WL
`5719670 (E.D. Mich. Sept. 30, 2015)
`
`5. Signal IP, Inc. v. Ford Motor Co., Case No. 14-cv-13864, 2015 WL
`5719671 (E.D. Mich. Sept. 20, 2015)
`
`6. Visteon Global Technologies, Inc. v. Garmin Intern., Inc., No. 10-cv-10578,
`2013 WL 434135 (E.D. Mich. Feb. 4, 2013)
`
`7. XMTT, Inc. v. Intel Corp., No. 18-1810, 2022 WL 2904308 (D. Del. July 22,
`2022)
`
`
`
`
`
`
`
`
`
`
`
`vii
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`

`

`Case 2:22-md-03034-TGB ECF No. 148, PageID.10680 Filed 06/07/23 Page 9 of 34
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`Plaintiff Neo Wireless LLC (“Neo” or “Plaintiff”) submits this response in
`
`opposition to Defendants Volkswagen Group of America Inc., Volkswagen Group
`
`of America Chattanooga Operations, LLC (“Volkswagen”), Nissan North America
`
`Inc., Nissan Motor Acceptance Corporation (“Nissan”), American Honda Motor
`
`Co., Inc., Honda Development & Manufacturing of America, LLC (“Honda”),
`
`Ford Motor Company (“Ford”), Toyota Motor North America, Inc., Toyota Motor
`
`Sales USA, Inc., Toyota Motor Engineering & Manufacturing North America, Inc.
`
`(“Toyota”), Tesla, Inc. (“Tesla”), Mercedes-Benz USA, LLC (“Mercedes”),
`
`General Motors Company, General Motors LLC (“GM”), and FCA US, LLC
`
`(“FCA”) (collectively “Defendants”) Joint Motion to Stay Pending Inter Partes
`
`Review of the Asserted Patents (“Motion to Stay”), ECF No. 145, and respectfully
`
`requests this Court deny the motion.
`
`I.
`
`BACKGROUND
`Defendants’ premature stay motion—filed when only some of their IPRs
`
`have been instituted, and several others are months away from even receiving an
`
`institution decision—should be denied outright, or at most held in abeyance until
`
`all IPR petitions have run their course. In the parties’ first status conference, in
`
`July 2022, the Court cautioned Defendants that it views stays pending IPR as
`
`“extremely disruptive” and “not . . . very effective [] in terms of helping the parties
`
`resolve anything,” as the process “introduces more delay and the parties end up
`
`1
`
`

`

`Case 2:22-md-03034-TGB ECF No. 148, PageID.10681 Filed 06/07/23 Page 10 of 34
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`raising similar arguments before the Court.” 7/18/23 Status Conference Hr’g Tr. at
`
`32–33. The Court explicitly urged Defendants to file any IPR petitions as quickly
`
`as possible, initially recommending they do so in thirty days. Id. at 30. Yet instead
`
`of heeding the Court’s advice, the Defendants in this MDL have taken the reverse
`
`approach. They have crafted a scheme of IPR filings that is unmistakably designed
`
`to be the most disruptive, most dilatory, and least likely to simplify issues as
`
`possible.
`
`First, they waited well longer than thirty days to file the first IPR, such that,
`
`with institution decisions now beginning to arrive, the parties are engaged in
`
`extensive, complex discovery, and days away from the Markman hearing. Second,
`
`they widely staggered the remaining IPRs, filing new petitions on the last
`
`allowable day, increasing the likelihood that complete resolution of all outstanding
`
`IPRs will take the maximum time possible. (In other words, they have attempted to
`
`have their cake and eat it too—filing at least some IPRs early enough to receive an
`
`institution decision in time to make an arguably timely motion to stay; but others
`
`late enough so the desired stay will delay the case as much as possible.) Third, they
`
`gamed the MDL framework to limit the potential downside from any IPR result—
`
`nominating one single defendant (Volkswagen) to carry the load on most IPRs,
`
`while the bulk of the others claim they will not be estopped by the results. In other
`
`words, Defendants have structured their IPR strategy to all but guarantee, for any
`
`2
`
`

`

`Case 2:22-md-03034-TGB ECF No. 148, PageID.10682 Filed 06/07/23 Page 11 of 34
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`claims for which validity is confirmed in the IPRs, the Court’s fear will be realized
`
`and Defendants will “end up raising similar arguments before the Court.”
`
`Defendants’ motion also mischaracterizes the impact of the MDL
`
`proceedings on the stay analysis. Far from creating inconsistencies or
`
`inefficiencies, proceeding with the MDL in parallel with the IPR proceedings
`
`presents the best opportunity for efficiently and uniformly preparing all MDL cases
`
`for trial. To date, the parties have fully briefed all claim construction disputes that
`
`either party identified as necessary for resolving the parties’ disputes
`
`(notwithstanding any fear mongering by Defendants that the IPRs will yield a host
`
`of new claim construction fights). The parties have exchanged detailed
`
`infringement, invalidity, and non-infringement/validity contentions, and the Court
`
`has instituted a framework for narrowing claims and prior art in the future (at
`
`Defendants’ insistence). See Dkt. 99. And one defendant—Mercedes—recently
`
`settled its dispute with Neo, removing that case (and the companion IPR filed by
`
`Mercedes) from the proceedings. See Dkt. 147. By proceeding with the MDL, the
`
`remaining parties can still use the pending IPRs as guidance in further narrowing
`
`their respective cases and do their best to avoid the likelihood of any wasted effort.
`
`But in the meantime, the parties and the Court can fully and efficiently litigate all
`
`of Defendants’ defenses for each patent, such that no matter what happens in the
`
`IPRs, the cases stand ready for trial (or continue to progress towards settlement).
`
`3
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`

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`Case 2:22-md-03034-TGB ECF No. 148, PageID.10683 Filed 06/07/23 Page 12 of 34
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`But if the Court stays the case now, because of Defendants’ bizarre
`
`patchwork of IPR filings,1 the estoppel effect of those IPRs could vary wildly by
`
`defendant and patent. See Mot. at 19 (contending only “Volkswagen, MBUSA, and
`
`Honda will be estopped from raising certain invalidity defenses in this case if they
`
`are rejected by the PTAB.”). Thus, the Court faces an equally bizarre patchwork of
`
`varying invalidity arguments when the stay is lifted. This guarantees an inefficient
`
`piecemeal conclusion to the MDL proceedings, as reflected below for each patent:
`
`’302 Patent: Because Volkswagen’s IPR was not instituted (and Honda’s
`
`late-filed follow-on IPR does not cover all asserted claims), no IPR estoppel will
`
`apply to any Defendant, and the parties will have to litigate all of Defendants’
`
`invalidity theories no matter what.
`
`
`1 As explained in Defendants’ Motion, Mot. at 9–10, Volkswagen first filed four
`petitions targeting the ’512, ’302, ’941, and ’450 patents in September 2022, with
`Mercedes seeking to join just the ’512 patent’s proceedings thereafter. Volkswagen
`waited another month before filing a petition against the ’908 patent and an
`additional three months before targeting the ’366 patent. At that point in January
`2023—roughly ten months after the filing of the initial complaints—no Defendant
`(other than Mercedes on one petition) had joined Volkswagen’s efforts. On the eve
`of the one-year time bar, Ford filed four petitions (against the ’941, ’908, ’512,
`and ’450 patents), seeking to join Volkswagen on three, while Honda filed five
`petitions (targeting all but the ’512 patent) seeking to join Volkswagen on four.
`Finally, just days ago and over 14 months after the complaints against them were
`filed, GM and Nissan filed four petitions, joined by Tesla on three and Honda on
`one, seeking to join three of Volkswagen’s IPRs and one of Ford’s. Institution
`decisions on Volkswagen’s remaining petitions are not expected until June 21 and
`September 29, 2023, respectively, while the petitions filed by Ford and Honda will
`not receive institution decisions until, at best, the end of 2023 or beginning of 2024.
`Mot. at 9–10.
`
`4
`
`

`

`Case 2:22-md-03034-TGB ECF No. 148, PageID.10684 Filed 06/07/23 Page 13 of 34
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`’366 Patent: If Volkwagen’s IPR is not instituted in September, no estoppel
`
`will apply as above. But even if instituted, should any claims survive, only Honda
`
`has moved to join that IPR, leaving the other six defendants to argue that they
`
`should still get to pursue their full invalidity defenses (even the same ones litigated
`
`in the IPR).2
`
`’908 Patent: Again, if Volkswagen’s IPR is not instituted this month, no
`
`estoppel will apply. And if instituted, only Ford and Honda have sought joinder,
`
`leaving five defendants to dispute estoppel.
`
`’512 Patent: Should the PTAB confirm the validity of any claims in
`
`Volkswagen’s IPR, only Ford, GM, Nissan, Tesla, and Honda have sought joinder.
`
`At least FCA and Toyota may claim estoppel does not apply to them.
`
`’450 Patent: Only Honda, GM, Nissan, and Tesla have sought to join
`
`Volkswagen’s and/or Ford’s separate IPRs of this patent. The other two defendants
`
`may contest estoppel.
`
`’941 Patent: As with others, only Ford, Honda, GM, Nissan, and Tesla have
`
`sought to join Volkswagen’s IPR, leaving the other two defendants to contest
`
`estoppel.
`
`
`2 To be clear, given the MDL Defendants’ joint defense of this case, Neo disagrees
`that such an argument would be successful. But Defendants’ Motion to Stay
`demonstrates their intention to make the argument, so the Court is likely to have to
`resolve that dispute as to those six defendants.
`
`5
`
`

`

`Case 2:22-md-03034-TGB ECF No. 148, PageID.10685 Filed 06/07/23 Page 14 of 34
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`In sum, for any patent that still has at least one claim remaining following
`
`Defendants’ IPRs, at least some Defendants will press their full invalidity defenses
`
`against those surviving claims, yielding no simplification of the issues at all for
`
`this consolidated proceeding. The Defendants’ only hope of simplifying the issues
`
`is in the unlikely circumstance where an entire patent is cancelled. But that one-
`
`sided possibility is not enough to justify a stay. See Signal IP, Inc. v. Ford Motor
`
`Co., Case No. 14-cv-13864, 2015 WL 5719671, at *4 (E.D. Mich. Sept. 20, 2015)
`
`(where most of the pending IPRs were filed by other automobile manufacturers
`
`rather than the defendants, “even if the Court granted a stay, because there is no
`
`estoppel provision…, it is likely that a stay will not simplify the issues in this
`
`case.”). The most efficient course for the parties and the Court is for the MDL to
`
`proceed to conclusion, after which the individual district courts on remand can deal
`
`with the implications of the IPRs (if any) specific to each individual defendant.
`
`II. LEGAL STANDARD
`“A stay is not a matter of right . . . [i]t is instead an exercise of judicial
`
`discretion, and the party requesting a stay bears the burden of showing that the
`
`circumstances justify the exercise of that discretion.” Everlight Electronics Co.,
`
`Ltd. v. Nichia Corp., No. 12-cv-11758, 2013 WL 1821512, at *6 (E.D. Mich. Apr.
`
`30, 2013) (quoting Indiana State Police Pension Trust v. Chrysler LLC, 129 S.Ct.
`
`2275, 2776 – 77 (2009)). “To determine whether a stay pending [IPR] is
`
`6
`
`

`

`Case 2:22-md-03034-TGB ECF No. 148, PageID.10686 Filed 06/07/23 Page 15 of 34
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`appropriate, courts apply the same factors as [when] determining whether to stay a
`
`case pending reexamination.” Regents of Univ. of Mich. v. St. Jude Med., Inc., No.
`
`12-12908, 2013 WL 239340, at *2 (E.D. Mich. May 31, 2013) (citation omitted).
`
`These factors include: “(1) whether a stay would unduly prejudice or present a
`
`clear tactical disadvantage to the non-moving party; (2) whether a stay would
`
`simplify the issues of the case; and (3) the stage of the proceedings.” Card-Monroe
`
`Corp. v. Tuftco Corp., No. 1:14-cv-292, 2015 WL 11109362, at *2 (E.D. Tenn.
`
`Feb. 19, 2015). No one factor is controlling “and a court’s decision to stay a case
`
`should be made after considering the totality of the circumstances.” Id. (internal
`
`citations omitted). “The decision of whether or not to stay a case is highly fact
`
`specific.” Signal IP, Inc. v. Fiat U.S.A., Inc., No. 14-cv-13864, 2015 WL 5719670,
`
`at *2 (E.D. Mich. Sept. 30, 2015). The present circumstances do not warrant any
`
`stay of the proceedings.
`
`III. ARGUMENT
`A. The Stage of the Case Does Not Justify a Stay.
`The bulk of the cases in this MDL were filed almost fifteen months ago.
`
`Because Volkswagen waited six months to file even just its initial round of IPRs in
`
`September of 2022, this case is now far from an “efficient stopping point.”3 Rather,
`
`
`3 Ethicon LLC v. Intuitive Surgical, Inc., No. 17-871-LPS, 2019 WL 1276029, at *2
`(D. Del. Mar. 20, 2019).
`
`7
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`

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`Case 2:22-md-03034-TGB ECF No. 148, PageID.10687 Filed 06/07/23 Page 16 of 34
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`the stage of this case represents over a year of complex, time-intensive work to
`
`consolidate nine cases into one MDL, conduct extensive and complicated
`
`discovery, and submit complete claim construction briefing. The parties have also
`
`engaged, with the Court’s encouragement, in extensive settlement discussions,
`
`resulting in settling Neo’s claims as to one defendant last week. See Dkt. 147.
`
`Especially in the unique MDL context, the stage of the case weighs against a stay.
`
`1. Significant Progress Has Been Made in Claim Construction,
`Discovery, and Settlement.
`As part of the Markman process, the parties have exchanged infringement
`
`and invalidity contentions, negotiated, debated, and narrowed claim construction
`
`disputes, submitted multiple technology tutorials, and submitted complete briefing
`
`on all disputes. And to further crystallize their positions, the parties exchanged
`
`lengthy non-burden (non-infringement and validity) contentions on May 31st. The
`
`parties are preparing for an imminent Markman hearing, and the Court and Special
`
`Master have no doubt invested significant time learning the technology at issue to
`
`prepare for the upcoming hearing. If the case is stayed, just prior to the completion
`
`of a Markman order, this preparation and effort will grow stale, and the parties and
`
`Court will have to re-prepare for what is now only weeks away.
`
`Discovery is no different. Discovery opened in August 2022, and Neo has
`
`pursued extensive technical and damages discovery from all nine defendants in the
`
`subsequent ten months. Hundreds of pages of written discovery have been
`
`8
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`

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`Case 2:22-md-03034-TGB ECF No. 148, PageID.10688 Filed 06/07/23 Page 17 of 34
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`exchanged, the parties have engaged in dozens of meet and confers to evaluate and
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`resolve disputes, and depositions are scheduled. Neo served deposition notices in
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`April, and has noticed or agreed to dates in June for a party deposition for each
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`Defendant. Defendants, too, have sought depositions of the named inventors on the
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`patents-in-suit, and four depositions of those inventors are scheduled for June and
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`July. These preparations, which took weeks of conferring and planning to
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`accommodate various schedules and objections, will be wasted with a stay.
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`Perhaps more importantly, a stay will certainly dismantle and waste the
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`efforts and resources Neo put into the necessary third-party discovery related to
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`the underlying source code that is now, after months of wrangling, being produced.
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`As the Court knows from the discovery conference held on March 24, 2023, Neo
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`has sought third-party source code related to Defendants’ products since the first
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`day of discovery, and has navigated a complex web of suppliers and intermediaries
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`to obtain it, with little help from Defendants. Neo has served twenty-one third-
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`party subpoenas, issued three letters rogatory to foreign entities (with the Court’s
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`help), and spent hours communicating with Defendants’ chipmakers to determine
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`how to obtain the source code needed to evaluate the operation of Defendants’
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`accused functionalities. And after all this effort, Qualcomm recently informed Neo
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`that source code has finally been identified and collected, and will be ready for
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`review this month. Other aspects of this effort are on the cusp of resolution, as Neo
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`Case 2:22-md-03034-TGB ECF No. 148, PageID.10689 Filed 06/07/23 Page 18 of 34
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`nears stipulations with several third-parties. A stay will disrupt Neo’s ability to
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`finally and efficiently obtain technical discovery, and add significantly to third-
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`parties’ costs if discovery is restarted after a long hiatus.4
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`Finally, and perhaps most importantly, Neo submits that a stay would
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`discourage, rather than encourage, settlement. The Court observed this possibility
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`in the first status conference, noting that prior stays were “not . . . very effective []
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`in terms of helping the parties resolve anything.” 7/18/23 Status Conference Hr’g
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`Tr. at 32–33. One defendant has already reached a settlement in this case. Dkt. 147.
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`The remaining Defendants have been (to varying degrees) actively negotiating
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`with Neo for several months. With new information from the recent settlement and
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`the ongoing pressure of a pending resolution on the merits, Neo hopes that
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`additional progress may be made in the coming weeks. But if the Court issues a
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`stay, the momentum of the preceding months may dissipate, and stalemates may
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`calcify. For example, at least one Defendant, FCA, has yet to agree to meet with
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`Neo about Neo’s opening settlement offer. And FCA is one of the five Defendants
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`4 Moreover, contrary to Defendants’ argument, Mot. at 16, the remaining fact
`discovery, including the discovery required from third parties, and most expert
`discovery will remain largely unchanged by any IPR decisions. All six asserted
`patents share the same inventors, meaning no depositions will be wasted even if
`some patents are ultimately cancelled. And while the asserted patents cover different
`aspects of 4G/5G communications, most fact discovery being sought from
`Defendants and their suppliers is agnostic to the specific details of each patent, and
`thus would have to be sought regardless of the number of patents in the case.
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`Case 2:22-md-03034-TGB ECF No. 148, PageID.10690 Filed 06/07/23 Page 19 of 34
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`not actively participating in any IPR proceedings during the contemplated stay.
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`Thus, if a stay issues, FCA and the other non-petitioning Defendants may opt to
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`wait on the sidelines while other parties litigate the issues to a decision—a decision
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`that may take years. Neo, too, will have little incentive to negotiate during a stay,
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`when some IPRs have not reached institution decisions and do not cover all
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`asserted claims (guaranteeing that Neo will, eventually, get its day in Court). A
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`stay will only hinder settlement progress by putting off a resolution on the merits.
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`2.
`The MDL Proceeding Makes a Stay Particularly Inappropriate.
`The stage of the case particularly favors denial where, as here, the Court sits
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`in the unique role of MDL judge, responsible only for pretrial proceedings. While
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`Defendants’ Motion focuses on the fact that “Trial Dates Have Not Been Set,” that
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`would be true of any MDL, since the MDL Court must ultimately remand the
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`individual cases for trial. The more appropriate inquiry in this context is whether
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`pretrial proceedings have been scheduled. And they have. The parties will likely
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`have completed fact discovery and be well into expert discovery before Defendants
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`even receive institution decisions on all their IPRs in late 2023 or early 2024. More
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`importantly, based on the Court’s Timeline of Model Scheduling Order and the
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`parties’ agreed schedule, the Court will likely remand the MDL cases back to their
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`origin courts before any Final Written Decisions issue (let alone all of them). The
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`Court’s Timeline suggests that pretrial proceedings in this case will conclude by
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`Case 2:22-md-03034-TGB ECF No. 148, PageID.10691 Filed 06/07/23 Page 20 of 34
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`April 2024. The earliest Final Written Decision is not expected until May 2024, or
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`November 2024 if an extension is granted. By the time any final IPR decisions
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`come down, this Court will likely have completed its role as MDL judge and sent
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`the cases back to their original courts for trial. This timing weighs heavily against a
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`stay. See, e.g., Signal IP, 2015 WL 5719670, at *4 (denying stay where the district
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`court would decide the issues before any PTAB decisions are made).
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`Furthermore, allegations by Defendants that the origin courts will have to
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`“redo discovery, claim construction or pretrial preparations” are pure speculation
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`and fear mongering. Defendants offer no concrete explanation for why any IPR
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`result might require a “redo.” On the contrary, as explained above Neo expects all
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`fact discovery to be largely identical regardless of what claims are ultimately tried.
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`And any suggestion that an IPR result requires redoing claim construction
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`improperly implies this Court will be unable to adequately interpret the disputed
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`claim terms in the upcoming proceedings. Neo has no such concerns. Defendants
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`already had every opportunity, over six months of claim construction discovery
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`and briefing (while preparing IPRs in parallel), to raise whatever claim
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`interpretation disputes they believe require the Court’s attention. The Court has
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`even granted them additional briefing on the purportedly “new” issues raised in
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`Defendants’ June 6th letter. Moreover, Volkswagen—the spearhead of Defendants’
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`IPRs—was confident enough in the Court’s ability to resolve claim construction
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`Case 2:22-md-03034-TGB ECF No. 148, PageID.10692 Filed 06/07/23 Page 21 of 34
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`disputes on the existing record that it stipulated it would not challenge those
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`constructions—in this Court or the PTAB. See Dkt. 114-001 & -002. The Court
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`has everything it needs to interpret the terms the parties identified as in dispute,
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`and no development in the IPRs (even a contrary construction) will require redo.
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`Defendants’ eleventh-hour letter5 to the Court all but confirms this fact. As
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`will be further explained in Neo’s forthcoming brief on June 13th, Defendants’
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`letter contains no issues bearing on the Court’s claim construction. Despite
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`alluding to new “statements made by Neo” (which would supposedly become part
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`of the intrinsic record for claim construction), Defendan