`
`UNITED STATES DISTRICT COURT
`EASTERN DISTRICT OF MICHIGAN
`SOUTHERN DIVISION
`
`
`IN RE NEO WIRELESS, LLC
`PATENT LITIG.
`
`
`Case No.: 2:22-md-3034-TGB
`
`Hon. Terrence G. Berg
`
`DEFENDANTS’ REPLY IN SUPPORT OF THEIR MOTION TO STAY
`PENDING INTER PARTES REVIEW OF THE ASSERTED PATENTS
`
`
`
`
`
`Case 2:22-md-03034-TGB ECF No. 149, PageID.10715 Filed 06/13/23 Page 2 of 14
`
`TABLE OF CONTENTS
`
`The Stage of the Case Favors a Stay. ............................................................. 2
`I.
`A Stay Will Simplify the Issues. .................................................................... 4
`II.
`III. Neo’s Claims of Prejudice and Unfair Advantage Are False. ........................ 6
`
`
`
`
`
`
`
`- i -
`
`
`
`Case 2:22-md-03034-TGB ECF No. 149, PageID.10716 Filed 06/13/23 Page 3 of 14
`
`TABLE OF AUTHORITIES
`
`Page(s)
`
`Cases
`Convergence Techs. (USA), LLC v. Microloops Corp.,
`2012 WL 1232187, at *1 (N.D. Cal. Apr. 12, 2012) ............................................ 7
`Finjan, Inc. v. Symantec Corp.,
`139 F. Supp. 3d 1032 (N.D. Cal. 2015) ................................................................ 7
`GII Acquisition, L.L.C. v. Cybernet Sys. Corp.,
`2014 WL 4209928 (E.D. Mich. Aug. 26, 2014) ................................................... 6
`Insituform Techs., Inc. v. Liqui-Force Servs. (USA), Inc.,
`2009 WL 1469660 (E.D. Mich. May 26, 2009) ................................................... 6
`Serv. Sols. U.S., L.L.C. v. Autel.US Inc.,
`2015 WL 401009 (E.D. Mich. Jan. 28, 2015) ...................................................... 4
`Signal IP, Inc. v. Ford Motor Co.,
`2015 WL 5719671, at *4 (E.D. Mich. Sept. 20, 2015) ........................................ 5
`Transtex LLC v. WABCO Holdings, Inc.,
`2018 WL 10742464 (E.D. Mich. Dec. 4, 2018) ................................................... 4
`Statutes
`35 U.S.C. § 315(b) ..................................................................................................... 1
`35 U.S.C. § 315(e)(1)–(2) .......................................................................................... 7
`
`
`
`
`
`
`
`- ii -
`
`
`
`Case 2:22-md-03034-TGB ECF No. 149, PageID.10717 Filed 06/13/23 Page 4 of 14
`
`
`
`Defendants’ Motion1 showed that each factor in the stay analysis weighs
`
`strongly in favor of granting a stay of the entire MDL. The overwhelming majority
`
`of authority supports Defendants’ positions. Neo’s Response2 ignores much of this
`
`analysis and does not even attempt to distinguish any of Defendants’ cases.
`
`Instead, Neo, without any evidence, baselessly accuses Defendants of
`
`gamesmanship. Neo accuses Defendants (at ECF No. 148, PageID.10680–683,
`
`PageID.10699–704) of a dilatory and “bizarre patchwork of IPR filings” to
`
`“increas[e] the likelihood that complete resolution of all outstanding IPRs will take
`
`the maximum time possible” and “gamed the MDL framework” by agreeing to
`
`have one defendant “carry the load on most IPRs.”
`
`Neo’s allegations are false. These lawsuits were centralized into an MDL at
`
`Neo’s request. Defendants are coordinating filings and discovery in the MDL
`
`because the Court instructed Defendants to do so, but they are situated differently
`
`when it comes to IPR filings and in no way coordinated to “game the MDL
`
`framework.” Each Defendant that has chosen to file IPRs has done so diligently.
`
`The statute gives a party sued for patent infringement one year to file an IPR
`
`against the patent, see 35 U.S.C. § 315(b), for good reason: IPRs are complex and
`
`
`1 ECF No. 145 (“Mot.”), PageID.10387–10427. MBUSA is not part of this
`Reply, as it has moved for its own stay of the case in view of settlement
`discussions with Neo. On June 6, 2023, MBUSA and Neo filed a joint notice of
`settlement and request for a stay. See ECF No. 147.
`2 ECF No. 148 (“Resp.”), PageID.10672–10705.
`1
`
`
`
`
`
`Case 2:22-md-03034-TGB ECF No. 149, PageID.10718 Filed 06/13/23 Page 5 of 14
`
`
`
`technically intensive submissions that take substantial time to prepare. Simply put,
`
`the filing Defendants drafted and filed their petitions as quickly as their ethical
`
`obligations to their clients permitted.3 Neo’s assertion otherwise is simply wrong—
`
`and notably, Neo include no facts or law that would suggest otherwise.
`
`Neo also does not offer any exigent circumstances that would prevent a stay
`
`here. The PTAB has already instituted IPRs on three of the six asserted patents,
`
`and the parties expect to receive another institution decision no later than June
`
`21—the date of the Markman hearing. Neo’s assertion that the other decisions are
`
`“months away” is misleading. Neo does not practice these patents, does not
`
`compete with any potential defendants, and does not request anything other than
`
`money. A stay will indisputably simplify this case; it will indisputably save the
`
`parties and (more importantly) the Court substantial resources; and it will
`
`indisputably not prejudice Neo’s ability to seek damages on valid patents.
`
`I.
`
`The Stage of the Case Favors a Stay.
`Neo’s arguments as to the first stay factor largely boil down to the
`
`contention that Neo has already done a lot of work. Even assuming that is true, the
`
`vast bulk of the work for the parties and—more importantly, the Court—remains.
`
`
`3 Neo’s focus (at ECF No. 148, PageID.10681, 10683 n.1, 10703–704) on
`the most-recently filed IPRs is misguided. All but two of these filings are follow-
`on petitions requesting to be joined to a prior-filed identical IPR petition. These
`additional petitions weigh in favor of a stay because they extend estoppel to
`additional Defendants and create no additional delay in the schedule.
`
`2
`
`
`
`Case 2:22-md-03034-TGB ECF No. 149, PageID.10719 Filed 06/13/23 Page 6 of 14
`
`
`
`Significant fact discovery, all of expert discovery, a claim construction hearing and
`
`order, and dispositive and non-dispositive motions remain. Neo suggests (at
`
`PageID.10688–689) that the work done so far will “be wasted with a stay,” but that
`
`makes no sense. The work already done will still be done after a stay. Even on its
`
`own terms, Neo’s claims (at PageID.10688) that third-party discovery would be
`
`disrupted should be given no weight. Neo waited more than a year to seek foreign
`
`discovery that was clearly vital from the outset. Having delayed, Neo cannot now
`
`credibly argue that this ongoing discovery weighs against a stay.
`
`Neo also theorizes (at PageID.10689) that a stay will discourage settlement.
`
`It is not clear why. If anything, a stay could free up party resources currently being
`
`spent on discovery and allow them to be spent on settlement negotiations. If there
`
`is a settlement to be had, a stay could encourage it.
`
`Finally, Neo contends (at PageID.10690–691) that no stay should issue
`
`because the MDL will have concluded before a final written decision on any IPR.
`
`This is, at best, speculation. But, even if true, that is precisely why a stay should be
`
`granted. Absent a stay, the PTAB’s final written decisions will either nullify the
`
`MDL efforts (in the event claims are invalidated) or, at a minimum, require
`
`additional briefing or discovery related to statements made by Neo or the Board
`
`3
`
`
`
`Case 2:22-md-03034-TGB ECF No. 149, PageID.10720 Filed 06/13/23 Page 7 of 14
`
`
`
`during the IPR proceedings.4 And the complexity of the discovery conducted so
`
`far, which Neo touts (at PageID.10688–689), simply reinforces this point: there is
`
`no reason for the parties and the Court to tread that same complicated ground
`
`twice, and there is certainly no reason to proceed now when it means that same
`
`complicated ground might have to be retread eight separate times in eight separate
`
`lawsuits after remand following the conclusion of the MDL.
`
`II. A Stay Will Simplify the Issues.
`Neo asserts (at PageID.10693–698) that a stay will somehow “complicate”
`
`the issues. Not so. One way or another, the instituted IPRs are guaranteed to
`
`simplify this case, via cancellation of entire patents, cancellation of individual
`
`claims, claim constructions entered by the PTAB, the estoppel provisions, or some
`
`combination of the foregoing. Defendants’ motion cited ample authority making
`
`this point. See, e.g., Transtex LLC v. WABCO Holdings, Inc., 2018 WL 10742464,
`
`at *1 (E.D. Mich. Dec. 4, 2018) (staying case because “an IPR []need not dispose
`
`of a case completely to simplify the issues in a case”); Serv. Sols. U.S., L.L.C. v.
`
`Autel.US Inc., 2015 WL 401009, at *2–3 (E.D. Mich. Jan. 28, 2015) (finding issue
`
`simplification weighed in favor of a stay where only 1 of 7 patents was under IPR
`
`
`4 The potential need for supplementary discovery or motions practice in no
`way implies that this Court will have any difficulty with claim construction.
`Contra Resp. at PageID.10691. The point is that parallel proceedings necessarily
`introduce the risk of inconsistencies and duplication of effort (not to mention the
`risk that Neo could amend its claims). Neo has no answer to this argument.
`
`4
`
`
`
`Case 2:22-md-03034-TGB ECF No. 149, PageID.10721 Filed 06/13/23 Page 8 of 14
`
`
`
`review because it would still “avoid potentially wasteful discovery while
`
`narrowing the claims and defenses in the case”). Neo has no response.
`
`Instead, Neo focuses (at PageID.10681–685, 10696–697) on the fact that not
`
`all Defendants will be statutorily estopped by the IPRs. This wrongly ignores the
`
`issue simplification arising from cancelled or amended claims or from statements
`
`made by Neo or the PTAB. Even in Neo’s best-case scenario in which all claims
`
`survive, the PTAB’s analysis will provide helpful guidance to this Court, and
`
`estoppel will remove certain issues from the case as to at least some Defendants.
`
`(Indeed, it is clear Neo intends to argue that the estoppel provisions will remove
`
`such issues as to all Defendants. See Resp. at PageID.10684 n.2.). Neo also cites
`
`for support to Signal IP, Inc. v. Ford Motor Co., but this case is inapposite because
`
`there—unlike here—the vast majority of IPR petitions were filed by non-parties
`
`and, crucially, the patentee there had agreed to dismiss all asserted claims subject
`
`to an IPR proceeding. 2015 WL 5719671, at *4 (E.D. Mich. Sept. 20, 2015).
`
`Neo also suggests (at PageID.10694–695) that the IPRs are unlikely to
`
`succeed, noting that prior IPRs against these patents were not instituted. Here, IPR
`
`petitions were instituted (proving wrong Neo’s previous predictions otherwise).
`
`The institution of the present petitions suggests it is more likely that the asserted
`
`patents and claims will be invalidated. Neo itself admits (at PageID.10694–695)
`
`that its broad independent claims are more susceptible to cancellation and that only
`
`5
`
`
`
`Case 2:22-md-03034-TGB ECF No. 149, PageID.10722 Filed 06/13/23 Page 9 of 14
`
`
`
`one third of instituted proceedings conclude with all claims intact.
`
`III. Neo’s Claims of Prejudice and Unfair Advantage Are False.
`Neo’s argument (at PageID.10698) that any delay unduly prejudices it has
`
`been soundly rejected by this District: “the delay inherent to the reexamination
`
`process does not constitute, by itself, undue prejudice.” Insituform Techs., Inc. v.
`
`Liqui-Force Servs. (USA), Inc., 2009 WL 1469660, at *2 (E.D. Mich. May 26,
`
`2009). That applies with additional force here. Neo does not compete with any
`
`Defendant, a stay will not prejudice Neo, and its requested remedy of monetary
`
`damages remains available regardless of any stay. GII Acquisition, L.L.C. v.
`
`Cybernet Sys. Corp., 2014 WL 4209928, at *2 (E.D. Mich. Aug. 26, 2014).
`
`Neo also claims (at PageID.10698–699) that its patents will soon expire and
`
`a delay here will limit its ability to sue other infringers. Neo cites no authority
`
`suggesting that, even if true, this would constitute undue prejudice. But Neo also
`
`fails to explain what is preventing it from suing other entities, or how it is
`
`prejudiced by the looming expiration of its patents after it waited more than two
`
`years to file suit against the current Defendants. Moreover, claims that Neo lacks
`
`the resources to prosecute lawsuits against other alleged infringers while this case
`
`is pending are belied by the facts. Just last month, Neo sued several defendants in
`
`Germany asserting related patents. Indeed, Neo’s sole business activity is asserting
`
`its patents, and it is backed by the multi-billion dollar Fortress Investment Group.
`
`6
`
`
`
`Case 2:22-md-03034-TGB ECF No. 149, PageID.10723 Filed 06/13/23 Page 10 of 14
`
`
`
`Neo’s next argument (at PageID.10699–703)—that Defendants would gain
`
`an unjust advantage as a result of a stay—likewise fails. Neo does not actually
`
`identify any such advantage, nor could it. Instead, Neo baselessly claims that
`
`Defendants conspired to file some IPRs quickly and some IPRs at the end of the
`
`statutory period to maximize the length of a stay. As explained above, Defendants
`
`did no such thing. Indeed, had Defendants engaged in the sort of collaborative
`
`activity Neo suggests, some or all Defendants may have rendered themselves real
`
`parties in interest with each other, triggering estoppel. See 35 U.S.C. § 315(e)(1)–
`
`(2). Tellingly, Neo made no argument to the PTAB that any other Defendant was
`
`erroneously omitted as a real party in interest from any IPR petition.
`
`In any event, courts have found stays warranted even where IPRs were
`
`staggered or filed very late in the statutory period. In Convergence Techs. (USA),
`
`LLC v. Microloops Corp., the defendants filed two separate reexam proceedings 18
`
`months apart. 2012 WL 1232187, at *1 (N.D. Cal. Apr. 12, 2012). The court there
`
`found no evidence of gamesmanship and no unjust advantage and stayed the case.
`
`Id. at *3–4; see also Finjan, Inc. v. Symantec Corp., 139 F. Supp. 3d 1032, 1036
`
`(N.D. Cal. 2015) (finding no gamesmanship when IPR was filed on the last day of
`
`the statutory window and granting a stay). Defendants here were far more diligent
`
`than the defendants in those cases and so, a fortiori, a stay is appropriate.
`
`Defendants respectfully request that the Court grant Defendants’ Motion.
`
`7
`
`
`
`Case 2:22-md-03034-TGB ECF No. 149, PageID.10724 Filed 06/13/23 Page 11 of 14
`
`
`
`Dated: June 13, 2023
`
`
`
`
`
` Respectfully submitted,
`
`/s/ Joseph A. Herriges (with consent)
`Joseph A. Herriges, MN Bar No.
`390350
`Conrad A. Gosen, MN Bar No.
`0395381
`James Huguenin-Love, MN Bar No.
`0398706
`FISH & RICHARDSON P.C.
`60 South Sixth Street, Suite 3200
`Minneapolis, MN 55402
`Telephone: (612) 335-5070
`Facsimile: (612) 288-9696
`herriges@fr.com, gosen@fr.com,
`huguein-love@fr.com
`
`Michael J. McKeon, DC Bar No.
`459780
`Christian Chu, DC Bar No. 483948
`Jared Hartzman, DC Bar No.
`1034255
`Joshua Carrigan, VA Bar No. 96911
`FISH & RICHARDSON P.C.
`1000 Maine Avenue SW, Suite 1000
`Washington, DC 20024
`Telephone: (202) 783-5070
`Facsimile: (202) 783-2331
`mckeon@fr.com, chu@fr.com,
`hartzman@fr.com, carrigan@fr.com
`
`J. Michael Huget (P39150)
`Sarah E. Waidelich (P80225)
`HONIGMAN LLP
`315 East Eisenhower Parkway
`Suite 100
`Ann Arbor, MI 48108
`Tel: (734) 418-4254
`Fax: (734) 418-4255
`mhuget@honigman.com,
`
`
`
`/s/ Justin B. Weiner
`Susan M. McKeever
`Justin B. Weiner
`Bush Seyferth PLLC
`100 West Big Beaver Road
`Suite 400
`Troy, MI 48084
`(248) 822-7851
`mckeever@bsplaw.com
`weiner@bsplaw.com
`
`Daniel E. Yonan
`Deirdre M. Wells
`Ryan C. Richardson
`William H. Milliken
`Anna G. Phillips
`Sterne, Kessler, Goldstein & Fox
`P.L.L.C
`1100 New York Avenue NW
`Suite 600
`Washington, DC 20005
`(202) 371-2600
`dyonan@sternekessler.com
`dwells@sternekessler.com
`rrichardson@sternekessler.com
`wmilliken@sternekessler.com
`aphillips@sternekessler.com
`
`Counsel for Defendants
`VOLKSWAGEN GROUP OF
`AMERICA, INC. AND
`VOLKSWAGEN GROUP OF
`AMERICA CHATTANOOGA
`OPERATIONS, INC.
`
`
`
`8
`
`
`
`Case 2:22-md-03034-TGB ECF No. 149, PageID.10725 Filed 06/13/23 Page 12 of 14
`
`
`
`swaidelich@honigman.com
`
`Counsel for Defendants
`GENERAL MOTORS COMPANY
`AND GENERAL MOTORS LLC
`
`/s/ John T. Johnson (with consent)
`John T. Johnson
`Jeffrey Mok
`FISH & RICHARDSON P.C.
`7 Times Square, 20th Floor
`New York, NY 10036
`Telephone: (212) 765-5070
`Facsimile: (212) 258-2291
`E-mail: jjohnson@fr.com
`
`Ruffin B. Cordell
`Benjamin J Christoff
`FISH & RICHARDSON P.C.
`1000 Maine Avenue, S.W.
`Suite 1000 Washington, D.C. 20024
`Telephone: (202) 783-5070
`Facsimile: (202) 783-2331
`E-mail: Cordell@fr.com
`Thomas Branigan (P41774)
`
`Bowman and Brooke LLP
`41000 Woodard Avenue, 200 East
`Bloomfield Hills, MI 48304
`Telephone: (248) 205-3300
`Facsimile: (248) 205-3399
`thomas.branigan@bowmanandbrook
`e.com
`
`Counsel for Defendants
`AMERICAN HONDA MOTOR
`CO., INC. AND HONDA
`DEVELOPMENT &
`MANUFACTURING OF
`AMERICA, LLC
`
`/s/ Thomas H. Reger II (with consent)
`Thomas H. Reger II
`Texas Bar No. 24032992
`reger@fr.com
`FISH & RICHARDSON P.C.
`1717 Main Street, Suite 5000
`Dallas, TX 75201
`Telephone: (214) 747-5070
`
`Lawrence Jarvis
`Georgia Bar No. 102116
`jarvis@fr.com
`FISH & RICHARDSON P.C.
`1180 Peachtree Street NE, 21st
`Floor
`Atlanta, Georgia 30309
`Telephone: (404) 892-5005
`Facsimile: (404) 892-5002
`
`Elizabeth G.H. Ranks
`Massachusetts Bar No. 693679
`ranks@fr.com
`FISH & RICHARDSON P.C.
`1 Marina Park Drive
`Boston, Massachusetts 02210
`Telephone: (617) 542-5070
`Facsimile: (617) 542-8906
`
`J. Michael Huget (P39150)
`Sarah E. Waidelich (P80225)
`HONIGMAN LLP
`315 East Eisenhower Parkway
`Suite 100
`Ann Arbor, MI 48108
`
`9
`
`
`
`Case 2:22-md-03034-TGB ECF No. 149, PageID.10726 Filed 06/13/23 Page 13 of 14
`
`
`
`
`
`/s/ Peter J. Brennan (with consent)
`Reginald J. Hill (IL Bar #6225173)
`Peter J. Brennan (IL Bar #6190873)
`JENNER & BLOCK LLP
`353 N. Clark St.
`Chicago, IL 60654
`Telephone: (312) 222-9350
`rhill@jenner.com
`pbrennan@jenner.com
`
`Counsel for Defendants
`NISSAN NORTH AMERICA INC.
`AND NISSAN MOTOR
`ACCEPTANCE CORPORATION
`a/k/a NISSAN MOTOR
`ACCEPTANCE COMPANY LLC
`
`Tel: (734) 418-4254
`mhuget@honigman.com
`swaidelich@honigman.com
`
`Counsel for Defendant
`TESLA, INC.
`
`/s/ Frank C. Cimino, Jr. (with consent)
`Frank C. Cimino, Jr.
`Megan S. Woodworth
`Jonathan L. Falkler
`Robert C. Tapparo
`VENABLE LLP
`600 Massachusetts Avenue, NW
`Washington, DC 20001
`(202) 344-4569
`FCCimino@Venable.com
`MSWoodworth@Venable.com
`JLFalkler@Venable.com
`RCTapparo@Venable.com
`
`Patrick G. Seyferth (P47575)
`Susan M. McKeever (P73533)
`BUSH SEYFERTH PLLC
`100 W. Big Beaver Road, Suite 400
`Troy, MI 48084
`(248) 822-780
`seyferth@bsplaw.com
`mckeever@bsplaw.com
`
`Counsel for Defendant
`FCA US LLC
`
`
`10
`
`
`
`Case 2:22-md-03034-TGB ECF No. 149, PageID.10727 Filed 06/13/23 Page 14 of 14
`
` /s/ John LeRoy (with consent)
`John S. LeRoy (P61964)
`Christopher C. Smith (P73936)
`Kyle G. Konz (P79452)
`1000 Town Center, 22nd Floor
`Southfield, MI 48075
`Telephone: (248) 358-4400
`Fax: (248) 358-3351
`jleroy@brookskushman.com
`csmith@brookskushman.com
`kkonz@brookskushman.com
`
`Counsel for Defendant
`FORD MOTOR COMPANY
`
`
`
`
`
`
`/s/ Paul R. Steadman (with consent)
`Paul R. Steadman (Ill. Bar No.
`6238160)
`Matthew Satchwell (Il. Bar No.
`6290672)
`Shuzo Maruyama (Ill. Bar No.
`6313434)
`DLA PIPER LLP (US)
`444 West Lake Street, Suite 900
`Chicago, IL 60606-0089
`Tel: 312.368.2135
`Fax: 312.251.2850
`paul.steadman@us.dlapiper.com
`matthew.satchwell@us.dlapiper.com
`shuzo.maruyama@us.dlapiper.com
`
`Brian Erickson (Texas Bar No.
`24012594)
`DLA PIPER LLP (US)
`303 Colorado Street, Suite 3000
`Austin, Texas 78701-4653
`Tel: 512.457.7059
`Fax: 512.721.2263
`brian.erickson@us.dlapiper.com
`
`Counsel for Defendants
`TOYOTA MOTOR
`CORPORATION, TOYOTA
`MOTOR NORTH AMERICA, INC.,
`TOYOTA MOTOR SALES, U.S.A.,
`INC. AND TOYOTA MOTOR
`ENGINEERING &
`MANUFACTURING NORTH
`AMERICA, INC. AND TOYOTA
`MOTOR CREDIT CORPORATION
`
`11
`
`