Case 2:22-md-03034-TGB ECF No. 229, PageID.12248 Filed 02/20/24 Page 1 of 10
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`UNITED STATES DISTRICT COURT
`EASTERN DISTRICT OF MICHIGAN
`SOUTHERN DIVISION
`2:22-MD-03034-TGB
`HON. TERRENCE G. BERG
`
`IN RE NEO WIRELESS, LLC
`PATENT LITIGATION
`
`
`
`OPINION AND ORDER
`DENYING JOINT MOTION TO
`STAY PENDING INTER
`PARTES REVIEW
`(ECF NO. 145)
`
`THIS MEMORANDUM
`OPINION AND ORDER
`RELATES TO ALL CASES
`
`Pending before the Court is the Joint Motion to Stay Pending Inter
`Partes Review of the Asserted Patents (the “Motion”) filed by Defendants
`Ford Motor Company, American Honda Motor Co., Inc., Honda
`Development & Manufacturing of America, LLC, Nissan North America,
`Inc., Nissan Motor Acceptance Corporation a/k/a Nissan Motor
`Acceptance Company, LLC, Toyota Motor Corporation, Toyota Motor
`North America, Inc., Toyota Motor Sales, U.S.A., Inc., Toyota Motor
`Engineering & Manufacturing North America, Inc., Toyota Motor Credit
`Corporation, General Motors Company, General Motors, LLC, Tesla,
`Inc., and FCA US, LLC (collectively “Defendants”).1 ECF No. 145.
`
`
`1 Defendant Mercedes-Benz USA, LLC was dismissed from the case on
`June 29, 2023. ECF No. 162. Defendants Volkswagen Group of America,
`Inc. and Volkswagen Group of America Chattanooga Operations, LLC
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`UNITED STATES DISTRICT COURT
`EASTERN DISTRICT OF MICHIGAN
`SOUTHERN DIVISION
`2:22-MD-03034-TGB
`HON. TERRENCE G. BERG
`
`IN RE NEO WIRELESS, LLC
`PATENT LITIGATION
`
`
`
`OPINION AND ORDER
`DENYING JOINT MOTION TO
`STAY PENDING INTER
`PARTES REVIEW
`(ECF NO. 145)
`
`THIS MEMORANDUM
`OPINION AND ORDER
`RELATES TO ALL CASES
`
`Pending before the Court is the Joint Motion to Stay Pending Inter
`Partes Review of the Asserted Patents (the “Motion”) filed by Defendants
`Ford Motor Company, American Honda Motor Co., Inc., Honda
`Development & Manufacturing of America, LLC, Nissan North America,
`Inc., Nissan Motor Acceptance Corporation a/k/a Nissan Motor
`Acceptance Company, LLC, Toyota Motor Corporation, Toyota Motor
`North America, Inc., Toyota Motor Sales, U.S.A., Inc., Toyota Motor
`Engineering & Manufacturing North America, Inc., Toyota Motor Credit
`Corporation, General Motors Company, General Motors, LLC, Tesla,
`Inc., and FCA US, LLC (collectively “Defendants”).1 ECF No. 145.
`
`
`1 Defendant Mercedes-Benz USA, LLC was dismissed from the case on
`June 29, 2023. ECF No. 162. Defendants Volkswagen Group of America,
`Inc. and Volkswagen Group of America Chattanooga Operations, LLC
`
`
`
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`Case 2:22-md-03034-TGB ECF No. 229, PageID.12249 Filed 02/20/24 Page 2 of 10
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`Plaintiff Neo Wireless, LLC’s (“Plaintiff” or “Neo”) filed an Opposition.
`ECF No. 148. Defendants filed a Reply. ECF No. 149. For the reasons
`stated in this opinion and order, the Court DENIES Defendants’ Joint
`Motion to Stay Pending Inter Partes Review of the Asserted Patents. 2
`I.
`FACTUAL AND PROCEDURAL BACKGROUND
`This multidistrict litigation (“MDL”) was transferred to this Court
`in June 2022. ECF No. 1. Plaintiff alleges that Defendants infringe: U.S.
`Pat. No. 10,833,908 (the “’908 Patent”); U.S. Pat. No. 10,447,450 (the
`“’450 Patent”); U.S. Pat. No. 10,075,941 (the “’941 Patent”); and U.S.
`Pat. No. 10,771,302 (the “’302 Patent”) (collectively “Asserted Patents”).3
`Between September 2022 and January 2023, Defendants filed a
`number of petitions for inter partes review (“IPR”) for the Asserted
`Patents.4 A number of the petitions were denied or terminated per the
`parties’ agreement, while petitions were granted for the ’941 Patent and
`
`
`
`were dismissed from the case on January 11, 2024. ECF No. 226.
`2 On February 2, 2024, Defendants emailed the Court requesting an
`opportunity to supplement the briefing on the Motion, and to request a
`hearing on the Motion. The Court finds that a hearing and supplemental
`briefing is unnecessary, and decides the Motion on the briefs and
`procedural background of the case.
`3 The Court concluded that a disputed term in the Asserted Claims in
`U.S. Pat. No. 8,467,366 (the “’366 Patent”) is indefinite. ECF No. 198,
`PageID.11579. U.S. Pat. No. 10,965,512 (the “’512 Patent”) was
`dismissed at the request of the parties on January 23, 2024. ECF No.
`223.
`4 See Status Update of Inter Partes Review (IPR) Post-Grant
`Proceedings. ECF Nos. 101, 121, 140, 152, 153, 179, 186, 194, 195, 197.
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`Case 2:22-md-03034-TGB ECF No. 229, PageID.12250 Filed 02/20/24 Page 3 of 10
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`the ’450 Patent. The petition for the ’941 Patent was granted on May 5,
`2023, and the U.S. Patent Trial and Appeal Board (“PTAB”) must make
`a final determination by May 5, 2024, excluding any extension. The
`petition for the ’450 Patent was granted on May 4, 2023, and the PTAB
`must make a final determination by May 4, 2024, excluding any
`extension. Parties seek a stay pending the PTAB’s determination of
`these petitions.
`The petitions for the ’908 Patent and the ’302 Patent were denied.
`After the petitions were denied, one defendant then filed an ex parte
`reexamination request. The reexamination request was granted for the
`’908 Patent on January 2, 2024, and for the ’302 Patent on October 23,
`2023.
`Regarding the stage of the MDL, the Court held a claim
`construction hearing on June 21, 2023, and issued a Claim Construction
`Memorandum and Order construing
`fourteen terms/phrases on
`November 20, 2023. ECF 198. The current deadline to complete fact
`discovery was February 12, 2024, and expert reports are due to be
`exchanged beginning on March 11, 2024. See January 25, 2024 Text
`Order Granting ECF No. 220-1.
`II. ANALYSIS
`A. Standard of Review
`Courts have “broad discretion to determine whether a stay is
`appropriate” pending inter partes review. Regents of the Univ. v. St. Jude
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`Case 2:22-md-03034-TGB ECF No. 229, PageID.12251 Filed 02/20/24 Page 4 of 10
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`Med., Inc., No. 12-12908, 2013 U.S. Dist. LEXIS 76845, at *5 (E.D. Mich.
`May 31, 2013); see also Clinton v. Jones, 520 U.S. 681, 706 (1997) (“The
`District Court has broad discretion to stay proceedings as an incident to
`its power to control its own docket.”). Determining the best way to
`manage the court’s docket “calls for the exercise of judgment, which
`must weigh competing interests and maintain an even balance.” Landis
`v. N. Am. Co., 299 U.S. 248, 254–55 (1936). The party seeking a stay has
`the “burden of showing that the circumstances justify the exercise of
`that discretion.” Everlight Elecs. Co. v. Nichia Corp., Civil Action No. 12-
`11758, 2013 U.S. Dist. LEXIS 61666, at *18 (E.D. Mich. Apr. 30, 2013).
`Courts consider three factors in determining whether to grant a
`stay: “(1) whether discovery is complete and whether a trial date has
`been set; (2) whether a stay will simplify the issues in question and trial
`of the case; and (3) whether a stay would unduly prejudice or present a
`clear tactical disadvantage to the non-moving party.” Regents of the
`Univ. v. St. Jude Med., Inc., No. 12-12908, 2013 U.S. Dist. LEXIS 76845,
`at *5 (E.D. Mich. May 31, 2013).
`B. Discussion
`After reviewing the parties’ arguments, the Court finds that a stay
`is not appropriate for the following reasons.
`1. The Stage of This Litigation Disfavors a Stay.
`When the Motion was originally filed, Defendants argued that fact
`discovery was ongoing, and that the parties had not taken any
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`Case 2:22-md-03034-TGB ECF No. 229, PageID.12252 Filed 02/20/24 Page 5 of 10
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`depositions of each other or completed document production. ECF No.
`145, PageID.10410–11.5 Defendants further argue that these cases were
`consolidated to promote efficiency, reduce conflicting rulings, and
`conserve the parties’ and Court’s resources. ECF No. 145, PageID.10411.
`According to Defendants, a failure to stay this MDL case would
`frustrate, rather than promote, those goals. Id.
`Plaintiff argues that this case is now far from an “efficient stopping
`point.” ECF No. 148, PageID.10686 (citing Ethicon LLC v. Intuitive
`Surgical, Inc., No. 17-871, 2019 WL 1276029, at *2 (D. Del. Mar. 20,
`2019)). At the time the Motion was filed, Plaintiff argued that 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. ECF No.
`148, PageID.10686–87. Plaintiff further argues that the parties have
`also engaged, with the Court’s encouragement, in extensive settlement
`discussions, resulting in the successful settlement of Neo’s claims as to
`one defendant on June 6, 2023. ECF No. 148, PageID.10687 (citing ECF
`No. 147). After the motion was filed, another defendant settled on
`January 11, 2024. ECF No. 226.
`
`
`5 Citations to the parties’ filings are to the filing’s number in the docket
`(ECF No.) and pin cites are to the PageID numbers assigned by the
`Court’s electronic filing system.
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`Case 2:22-md-03034-TGB ECF No. 229, PageID.12253 Filed 02/20/24 Page 6 of 10
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`Considering the current posture of this case, the Court concludes
`that Plaintiff’s position is correct. The present stage of the case weighs
`against a stay, especially in this unique MDL context. Defendants filed
`the motion in May 2023. Since then, the Court held a claim construction
`hearing and issued a Claim Construction Memorandum and Order
`construing fourteen terms/phrases in the Asserted Patents. ECF No.
`198. Fact discovery is complete or near completion, and expert reports
`are due to be exchanged beginning on March 11, 2024. See January 25,
`2024 Text Order Granting ECF 220-1. At this stage, a stay would do
`nothing more than draw out the time before the MDL cases are
`remanded back to their courts of origin. Accordingly, this factor weighs
`against a stay.
`2. A Stay Will Unduly Prejudice Plaintiff.
`Defendants argue that a stay pending the completion of the IPR
`proceedings will not prejudice Plaintiff. ECF No. 145, PageID.10420.
`Defendants contend that Plaintiff does not make or sell any products,
`does not practice the technology, had no role in developing the patented
`technology, and has no business activities relating to developing
`technology or making or selling any product. Id. Defendants further
`argue that Plaintiff is backed by a litigation funding entity that exists to
`assert patents it holds in its portfolio in hopes of a financial return. Id.
`Defendants also argue that Plaintiff delayed in bringing these suits for
`more than two years. ECF No. 145, PageID.10421.
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`Case 2:22-md-03034-TGB ECF No. 229, PageID.12254 Filed 02/20/24 Page 7 of 10
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`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 raising similar arguments before the Court[.]” July 7,
`2023 Status Conference Hr’g Tr., ECF No. 56, PageID.2176–77. Ford
`and Honda waited to file their respective IPRs until the latest possible
`moment under the one-year time bar. Furthermore, Plaintiff represents
`to the Court that Defendants refused to confirm whether they intended
`to file any additional IPRs or to agree not to seek an extension of any
`stay based on IPRs that may be filed by additional third parties. ECF
`No. 148, PageID.10700.
`Likewise, one Defendant waited until after the IPR petitions were
`denied
`for the
`’908 Patent and the
`’302 Patent before
`filing
`reexamination requests. Defendants’ staging of IPRs and reexamination
`requests provide Defendants with the tactical advantage of enabling the
`longest possible stay, a tactic that is unduly prejudicial to Plaintiff.
`Finally, a stay prejudices Plaintiff’s interest in obtaining an
`expeditious resolution of its case. Kahn v. GMC, 889 F.2d 1078, 1080
`(Fed. Cir. 1989) (illustrating the Federal Circuit’s long held position that
`there is strong public policy in favoring expeditious resolution of
`litigation). Indeed, “the mere fact that [a plaintiff] is not currently
`practicing the patents does not mean that, as a matter of law, it is not
`prejudiced by a substantial delay of an imminent trial date.” Rembrandt
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`Case 2:22-md-03034-TGB ECF No. 229, PageID.12255 Filed 02/20/24 Page 8 of 10
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`Wireless Techs., LP v. Samsung Elecs. Co., No. 13-213, 2015 U.S. Dist.
`LEXIS 20303, at *9 (E.D. Tex. Jan. 29, 2015). Accordingly, this factor
`weighs against a stay.
`
`3. A Stay is Unlikely to Simplify the Issues in this
`Case.
`Defendants argue that a stay will avoid waste of judicial resources.
`ECF No. 145, PageID.10416. Defendants contend that a stay will avoid
`wasteful discovery and will also allow the parties and the Court to
`consider statements made to the Patent Office when analyzing the scope
`of claims. ECF No. 145, PageID.10416–18. Defendants also argue that if
`a stay is not instituted now, the parties and the Court will likely have to
`redo portions of the case. ECF No. 145, PageID.10418.
`Plaintiff responds that four of the six asserted patents have
`previously defied IPR challenges by other petitioners. ECF No. 148,
`PageID.10695. Plaintiff also argues
`that Defendants’ projected
`simplification is one-sided. ECF No. 148, PageID.10696. Plaintiff further
`contends that the PTAB rulings will not resolve the other defenses
`raised by Defendants, including waiver, estoppel, lack of statutory
`subject matter under 35 U.S.C. § 101, prosecution laches, and other
`equitable defenses. ECF No. 148, PageID.10697.
`Contrary to Defendants’ argument, the Court agrees with Plaintiff
`that any remaining fact discovery, including the discovery required from
`third parties, and most expert discovery will remain largely unchanged
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`Case 2:22-md-03034-TGB ECF No. 229, PageID.12256 Filed 02/20/24 Page 9 of 10
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`by any IPR decisions. All six originally asserted patents share the same
`inventors, meaning no depositions will be wasted even if some patents
`are ultimately cancelled.
`Moreover, there will not be a waste of judicial resources because
`the parties have exchanged detailed infringement, invalidity, and non-
`infringement/validity contentions, and the Court has provided a claim
`construction order. Moreover, two defendants have settled their disputes
`with Plaintiff. ECF Nos. 162, 226. Likewise, the Court concluded that a
`disputed term in the Asserted Claims in the ’366 Patent is indefinite.
`ECF No. 198. In addition, the parties stipulated to dismissing the ’512
`Patent, and terminating their respective IPR proceedings. ECF No. 219.
`The Court questions whether these efficiencies would have been
`realized if the MDL had been stayed, particularly at the time
`Defendants originally requested the stay. By proceeding with the MDL,
`the remaining parties can use the pending IPRs as guidance in further
`narrowing their respective cases and do their best to avoid the likelihood
`of any wasted effort.
`In the meantime, the parties and the Court will fully and
`efficiently litigate all of Defendants’ defenses for each patent, such
`that—regardless of what happens in the IPRs—the cases will stand
`ready for trial, or continue to progress towards possible settlement.
`Accordingly, the Court finds that a stay pending IPR would not simplify
`the issues in this case at this juncture.
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`Indeed, at the request of Defendants, the Court permitted the
`parties to file supplemental briefing for disputed terms in the ’512
`Patent and ’941 Patent based on two decisions of the PTAB, which
`occurred after the claim construction briefing. June 6, 2023 Text Order.
`The Court reviewed the supplemental briefing, and it did not appear to
`cite to any new statements made by Plaintiff since the claim
`construction briefing was originally filed. ECF Nos. 150, 151, 154, 155.
`Instead, the briefing only cited to statements made by the PTAB in its
`Decision Granting Institution of IPR. Thus, contrary to Defendants’
`contention, the IPRs have yet to yield a host of new claim construction
`fights. Accordingly, this factor weighs against a stay.
`III. CONCLUSION
`For the foregoing reasons, the Joint Motion to Stay Pending Inter
`Partes Review of the Asserted Patents, ECF No. 145, is DENIED.
`It is SO ORDERED.
`Dated: February 20, 2024
`
`/s/Terrence G. Berg
`HON. TERRENCE G. BERG
`UNITED STATES DISTRICT JUDGE
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`
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