IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF DELAWARE
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`
`
`C.A. No. 12-398-GMS
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`
`)))))))))))))
`
`HUMANEYES TECHNOLOGIES, LTD.’S, ANSWERING BRIEF IN OPPOSITION TO
`SONY’S MOTION TO STAY LITIGATION PENDING THE OUTCOME
`OF INTER PARTES REVIEW OF THE PATENTS-IN-SUIT
`
`ASHBY & GEDDES
`Steven J. Balick (#2114)
`Tiffany Geyer Lydon (#3950)
`Andrew C. Mayo (#5207)
`500 Delaware Avenue, 8th Floor
`P.O. Box 1150
`Wilmington, Delaware 19899
`(302) 654-1888
`sbalick@ashby-geddes.com
`tlydon@ashby-geddes.com
`amayo@ashby-geddes.com
`
`Attorneys for Plaintiff
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`
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`Of Counsel:
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`Matthew D. Powers
`Steven S. Cherensky
`Paul T. Ehrlich
`Stefani C. Smith
`Robert L. Gerrity
`TENSEGRITY LAW GROUP LLP
`555 Twin Dolphin Drive, Suite 360
`Redwood Shores, CA 94065
`(650) 802-6000
`
`Dated: May 6, 2013
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`{00745553;v1 }
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`
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`Plaintiff,
`
`
`
`v.
`
`
`
`HUMANEYES TECHS., LTD.
`
`
`
`
`
`SONY CORP., SONY CORP. OF
`AMERICA, SONY ELECS., INC., SONY
`MOBILE COMMS. AB, SONY MOBILE
`COMMS. (USA), INC. 
`
`
`
`Defendants.
`
`
`
`Petition for Inter Partes Review
`of U.S. Pat. No. 7,477,284
`IPR2013‐00219
`EXHIBIT
`Sony‐
`
`

`

`
`
`TABLE OF CONTENTS
`
`I. NATURE AND STAGE OF THE PROCEEDINGS............................................................. 1
`II. SUMMARY OF ARGUMENT.............................................................................................. 2
`III. STATEMENT OF FACTS..................................................................................................... 3
`IV. ARGUMENT: ALL THREE TRADITIONAL FACTORS WEIGH HEAVILY AGAINST
`STAYING THIS ACTION..................................................................................................... 8
`
`A. THE SIGNIFICANT RESOURCES ALREADY EXPENDED BY THE PARTIES, INCLUDING THE
`COMPLETION OF LIABILITY FACT DISCOVERY, DEMONSTRATE THIS CASE IS FAR ALONG AND
`READY FOR PROMPT RESOLUTION BEFORE THIS COURT...................................................... 10
`
`B.
`
`EVEN IF INSTITUTED, THERE IS NO OUTCOME FOR SONY’S INTER PARTES REVIEW PETITIONS
`THAT WILL MEANINGFULLY SIMPLIFY THE KEY ISSUES OF INFRINGEMENT, VALIDITY, OR
`DAMAGES FOR TRIAL............................................................................................................ 12
`
`C. DELAYING THIS ALREADY 13-MONTH-OLD ACTION WILL UNDULY PREJUDICE
`HUMANEYES’ BUSINESS AND LICENSING EFFORTS AND WILL PRESENT A CLEAR TACTICAL
`DISADVANTAGE FOR HUMANEYES ....................................................................................... 15
`
`1. Sony’s Extreme Delay in Filing its Petitions Despite Serving Detailed Invalidity
`Contentions Seven Months Prior Demonstrates Intent to Unduly Prejudice and Tactically
`Disadvantage HumanEyes .................................................................................................... 16
`
`2. Sony’s Ongoing Infringement of HumanEyes’ Patents Continues to Damage
`HumanEyes’ Licensing and Partnership Efforts................................................................... 17
`V. CONCLUSION .................................................................................................................... 19
`
`
`
`
`
` i
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`

`

`TABLE OF AUTHORITIES
`
`Cases
`
`Affinity Labs of Texas v. Nike, Inc.
`2011 U.S. Dist. LEXIS 51665 (N.D. Cal. May 13, 2011) .......................................................... 9
`
`Alps South, LLC v. Ohio Willow Wood Co.
`2010 U.S. Dist. LEXIS 144260 (M.D. Fla. June 16, 2010)........................................................ 9
`
`Belden Techs. v. Superior Essex Commc'ns LP
`2010 U.S. Dist. LEXIS 90960 (D. Del. Sept. 2, 2010)....................................................... 16, 18
`
`Boston Scientific Corp. v. Cordis Corp.
`777 F. Supp. 2d 783 (D. Del. 2011)...................................................................................... 8, 15
`
`Esco Corp. v. Berkeley Forge & Tool, Inc.
`2009 U.S. Dist. LEXIS 94017 (N.D. Cal. Sept. 28, 2009) ................................................... 9, 13
`
`First Am. Title Ins. Co. v. Maclaren LLC
`2012 U.S. Dist. LEXIS 31508 .............................................................................................. 8, 15
`
`Imagevision.net v. IPX, Inc.
`Civil Action No. 12-054, D.I. 65 (D. Del. April 22, 2013) ............................................... passim
`
`Interwoven, Inc. v. Vertical Comp. Systems
`2012 U.S. Dist. LEXIS 30946 (N.D. Cal. Mar. 8, 2012)............................................................ 9
`
`LG Electronics U.S.A. v. Whirlpool Corp.
`2011 U.S. Dist. LEXIS 11488 (D.N.J. Feb. 4, 2011) ................................................................. 9
`
`Quest Software v. Centrify Corp.
`2011 U.S. Dist. LEXIS 28902 (D. Utah Mar. 21, 2011) ...................................................... 9, 13
`
`Round Rock Research LLC v. Dole Food Co.
`2012 U.S. Dist. LEXIS 49106, 2012 WL 1185022 (D. Del. Apr. 6, 2012).............................. 16
`
`SenoRx, Inc. v. Hologic, Inc.
`2013 U.S. Dist. LEXIS 8044 (D. Del. January 11, 2013).................................................. passim
`
`Shurtape Techs. v. 3M Co.
`2013 U.S. Dist. LEXIS 28815 (W.D.N.C. Mar. 1, 2013)........................................................... 9
`
`Tuitionfund, LLC v. Suntrust Banks
`2012 U.S. Dist. LEXIS 144408 (M.D. Tenn. Oct. 5, 2012) ................................................. 9, 13
`
`Ultra Prods. v. Antec, Inc.
`2010 U.S. Dist. LEXIS 50096 (N.D. Cal. Apr. 26, 2010) .......................................................... 9
`
` ii
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`

`

`Xerox Corp. v. 3Com Corp.
`69 F. Supp. 2d 404 (W.D.N.Y. 1999)................................................................................... 8, 15
`
`Statutes
`
`35 USC § 316(a)(11)....................................................................................................................... 6
`
`Other Authorities
`
`Federal Register on May 2, 2012
`77 Fed. Reg. 26041 (2012) ......................................................................................................... 3
`
`
`
`
`
` iii
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`

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`Plaintiff HumanEyes Technologies, Ltd., by and through its attorneys, respectfully
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`submits this brief in opposition to Defendants Sony Corporation, Sony Corporation of America,
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`Sony Electronics Inc., Sony Mobile Communications AB, and Sony Mobile Communications
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`(USA) Inc.’s Motion to Stay Litigation Pending the Outcome of Inter Partes Review of the
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`Patents-in-Suit and Sony’s Supporting Brief.
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`I.
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`NATURE AND STAGE OF THE PROCEEDINGS
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`On March 29, 2012, HumanEyes filed patent infringement suits against Sony in this
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`Court (seeking monetary damages) and at the International Trade Commission (“ITC”) (seeking
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`an exclusion order). When the ITC instituted Investigation No. 337-TA-842, Sony exercised its
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`statutory right to stay these district court proceedings until after the Investigation’s resolution.
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`For seven months, the parties diligently pursued intensive discovery before the ITC on the same
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`patents and the same accused features and products. The parties completed all liability fact
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`discovery, produced more than 550,000 pages of documents, deposed 22 witnesses, exchanged
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`infringement and invalidity contentions, and exchanged proposed claim constructions. When the
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`ITC Investigation was just four months from trial Sony committed to remove the accused
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`features from its products, thus obviating the need for an ITC exclusion order. As such,
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`HumanEyes sought and obtained voluntary termination of the ITC action, in favor of the action
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`before this Court.
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`On March 29, 2013, one day shy of the statutory maximum for filing, Sony filed two
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`petitions for inter partes review (“IPR”). Those petitions challenge only 14 of the 155 claims of
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`the asserted patents and are based primarily on references charted by Sony seven months ago in
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`its ITC invalidity contentions. The Patent Trial and Appeals Board (“PTAB”) reviewing these
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`petitions will not likely reach a substantive decision regarding any claims it decides to review
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`until October 3, 2014 (or April 3, 2015 for good cause); the appeals process may further delay
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`{00745553;v1}
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`1
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`final resolution. Sony’s Motion asks this Court to take a litigation that was four months from
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`trial and delay it two to four years, or even more.
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`II.
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`SUMMARY OF ARGUMENT
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`Sony’s tactical move to seek inter partes review of only a small handful of patent claims
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`is a naked attempt to deny HumanEyes’ access to this Court by burying it in administrative
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`procedure. HumanEyes is a 15-employee small business that has been striving to defend its
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`intellectual property rights against Sony’s infringement for more than a year, including months
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`of intensive litigation before the ITC on the very same patents asserted here. The Court should
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`deny Sony’s Motion because, as further detailed below, all three of the factors to be considered
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`by this Court weigh heavily against a stay in this case.
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` 1.
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`This Court looks to three important factors to determine whether to grant a motion
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`for a stay pending resolution of a post-grant review proceeding: (1) the stage of the litigation,
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`including the resources already expended by the parties, whether the parties have already
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`engaged in substantial discovery, whether discovery is complete, and whether a trial date has
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`been set; (2) whether the requested stay is likely to meaningfully simplify the issues in question
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`and trial of the case; and (3) whether the requested stay would unduly prejudice or present a clear
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`tactical disadvantage to the plaintiff—including the timing of the underlying post-grant review
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`petition, the timing of the motion for stay, the status of the post-grant review proceedings, and
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`the relationship between the parties and whether the plaintiff’s injuries may be compensated
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`through future money damages. In the present litigation, each of these factors weighs heavily
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`against Sony’s Motion for a stay: (1) the litigation has already progressed significantly before the
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`ITC; (2) even a complete victory for Sony before the PTAB would not meaningfully simplify the
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`issues in question or trial of this case, but would take two to four years to resolve; and (3) a stay
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`{00745553;v1}
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`would substantially and unduly prejudice HumanEyes’ business opportunities and tactically
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`disadvantage HumanEyes in this litigation.
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`III.
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`STATEMENT OF FACTS
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`Sony’s Statement of Facts in its Motion disregards essential facts regarding the progress
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`of this litigation, the status and timing of Sony’s IPR petitions, and the existing record of the
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`harm that Sony’s infringement and litigation delay has caused (and continues to cause) to
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`HumanEyes’ business. As will be shown below, those disregarded facts are key components of
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`the factors this Court must weigh in evaluating Sony’s request for a stay.
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`On March 29, 2012, HumanEyes filed suit in the ITC alleging that certain Sony cameras
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`and mobile devices, related software and firmware, and components thereof and products
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`containing the same were infringing HumanEyes’ patents. Motion Ex. E (ITC Complaint).1 The
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`asserted patents, U.S. Patent Nos. 6,665,003 (“the ’003 Patent”) and 7,477,284 (“the ’284
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`Patent”), are the same patents asserted in HumanEyes’ Complaint and First Amended Complaint
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`in this action. D.I. 1, 27. The ITC instituted Investigation No. 337-TA-842, and notice was
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`published in the Federal Register on May 2, 2012. 77 Fed. Reg. 26041 (2012). The target date
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`for completion of the 842 Investigation was set for 16 months after institution. Ex. 1 (ITC Inv.
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`No. 337-TA-842, Order No. 3). The May 21, 2012, procedural order set aggressive dates for fact
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`discovery, contentions, claim construction, expert discovery, and an administrative hearing. Ex.
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`2 (ITC Inv. No. 337-TA-842, Order Nos. 4, 8).
`
`
`1 “Motion Ex. __” refers to exhibits to the declaration of Iuliana Tanase filed concurrently with
`Sony’s Motion. “Ex. __” refers to exhibits to the Declaration of Robert L. Gerrity In Support Of
`HumanEyes’ Answering Brief in Opposition to Sony’s Motion to Stay Litigation Pending the
`Outcome of Inter Partes Review of the Patents-in-Suit filed concurrently herewith. “Levy-Ron
`Decl. __” refers to paragraphs from the Declaration of Vered Levy-Ron In Support Of
`HumanEyes’ Answering Brief in Opposition to Sony’s Motion to Stay Litigation Pending the
`Outcome of Inter Partes Review of the Patents-in-Suit, also filed concurrently herewith.
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`{00745553;v1}
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`Under this aggressive ITC schedule, the parties diligently pursued discovery into the
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`same key issues involved in the action before this Court: infringement and validity of the
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`asserted patents, sales of Sony’s infringing cameras and mobile devices, and Sony’s knowledge
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`of the asserted patents.2, 3
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`Sony’s Motion ignores the parties’ substantial progress and investment in this litigation
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`when it described this case as at an “early stage.” See, e.g., Motion at 2, 3, and 10. To the
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`contrary, prior to the September 21 close of fact discovery in the ITC Investigation, the parties
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`had already engaged in nearly seven months of intensive litigation regarding the very same
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`asserted patents and accused products at issue in the action before this Court. The parties have
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`already completed liability fact discovery, including: 476,177 pages of documents produced by
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`Sony; 104,919 pages of documents produced by HumanEyes; and the depositions of at least 22
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`witnesses, including the completion of each party’s 30(b)(6) depositions. The parties also
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`propounded and responded to a combined 192 interrogatory requests, 245 requests for
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`production, and 305 requests for admission, and negotiated and completed email discovery. The
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`parties exchanged contentions relating to Sony’s alleged infringement, and exchanged
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`contentions relating to the validity of HumanEyes’ patents. The parties also exchanged proposed
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`claim constructions with identifications of supporting intrinsic and extrinsic evidence.4
`
`
`2 Although monetary damages and Sony’s willful infringement were not specifically raised
`before the ITC, discovery into Sony’s infringing sales was pursued because of its relevance to
`commercial success (an objective indicia of non-obviousness). Similarly, discovery into Sony’s
`knowledge of the asserted patents was pursued because of its relevance to copying (another
`objective indicia of non-obviousness).
`3 Sony insisted on the return or destruction of all materials containing its designated Confidential
`Business Information subject to the ITC Investigation Protective Order (See Ex. 3 (ITC Inv. No.
`337-TA-842, Order No. 1)). However, HumanEyes carefully returned all such materials to Sony
`in an organized and easy to re-produce format so that the discovery completed in the ITC
`Investigation can be efficiently integrated into this matter.
`4 Gerrity Decl. ¶¶ 1-2.
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`Based on Sony’s commitment toward the end of the ITC fact discovery period to remove
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`the accused features from all of its product lines no later than September 3, 2013, the target date
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`of the ITC Investigation, HumanEyes brought an unopposed motion to terminate the ITC
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`Investigation. ALJ Shaw granted HumanEyes’ motion to terminate on September 25, 2012, in
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`his Initial Determination. Ex. 16 (ITC Inv. No. 337-TA-842, Order No. 11). The Initial
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`Determination became the Determination of the Commission on October 23, 2012. Ex. 17
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`(Notice of Commission Determination Not to Review An Initial Determination Terminating the
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`Investigation).
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`At the time of ALJ Shaw’s Initial Determination, the parties were about three weeks from
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`filing “burden of proof” expert reports on infringement and invalidity, about two months from
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`the close of expert discovery, and about four months away from the hearing.
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`Five months after the termination of the ITC Investigation, seven months after serving
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`invalidity contentions, and precisely 364 days after receiving service of HumanEyes’ complaints
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`in this action and at the ITC, Sony filed the IPR petitions that give rise to its Motion. The
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`petitions request inter partes review of only 14 of the 155 claims in the asserted patents. Motion
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`Exs. B-D. Sony’s petition seeks review of less than half of the 40 claims Sony was entitled to
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`petition for the same filing fee, and less than 10% of the 155 claims in the two patents. Compare
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`Motion Exs. B, C with Motion Ex. G at 38 and Exs. 10 (’003 Patent) and 11 (’284 Patent).
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`Sony’s August 29, 2012, invalidity contentions in the ITC Investigation included claim
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`charts for seven of the eight references relied upon in Sony’s IPR petitions seven months later,
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`including all three of the primary references Sony relies on. Compare Motion Exs. B, C with Ex.
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`4. Sony’s petition for IPR of the ’003 Patent is based on four alleged prior art references, all of
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`which were previously charted by Sony. Compare Motion Ex. B with Ex. 4. Sony’s petition for
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`{00745553;v1}
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`IPR of the ’284 Patent is based on three of the same references from its ’003 petition as well as
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`four additional references—three of which were also included in Sony’s ITC invalidity
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`contentions, and the remaining reference (The Kodak DC50 user guide) is relied on only in
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`asserted obviousness combinations. Compare Motion Ex. C with Ex. 4.
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`Neither of Sony’s IPR petitions have been granted by the PTAB. See Motion Ex. D. As
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`Sony notes in its Motion at footnote 1, the PTAB is not even required to decide whether to
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`institute either of Sony’s petitions (and, if so, which of the 14 challenged claims it may review)
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`until October 3, 2013. If the PTAB decides to review any of the 14 challenged claims, it is then
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`allowed an additional 18 months to conduct the actual proceeding. Thus any potential ruling on
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`Sony’s petitions, if granted at all, could be pushed out to as far as April 3, 2015, even if there are
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`no appeals. Motion at 2 n.1; 35 USC § 316(a)(11). Appeals of the PTAB’s decisions regarding
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`the IPRs could push the requested stay out years beyond that.
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`Following termination of the ITC Investigation, this Court lifted the stay in this action.
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`D.I. 16. Sony answered HumanEyes’ First Amended Complaint on March 11, 2013, leaving the
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`parties poised for a Rule 16 scheduling conference to discuss an expedited schedule to complete
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`the Markman process already begun in the ITC Investigation, to complete expert discovery, and
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`to conduct minimal supplemental fact discovery, such as discovery regarding Sony’s additional
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`sales of legacy products containing the accused features since termination of the ITC
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`Investigation. Rather than proceeding with a Rule 16 conference and an expedited resolution of
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`this litigation, Sony moved on April 19, 2013, three weeks after filing its IPR petitions, for a stay
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`of up to two years—or more after appeals—based on Sony’s speculation that the PTAB may
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`grant one or more of Sony’s petitions as to one or more of the limited subset of claims from the
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`asserted patents challenged by Sony in its petitions.
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`{00745553;v1}
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`HumanEyes has made substantial investments in a licensing program aimed at identifying
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`and cultivating partnerships with companies interested in incorporating HumanEyes’ technology
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`into their products. Levy-Ron Decl. at ¶ 6; Motion Ex. E (ITC Complaint) at ¶ 62. HumanEyes’
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`employees—including founder Shmuel Peleg, former CEOs Gideon Ben-Zvi and Duby Hodd,
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`current CEO Vered Levy-Ron, and former and current Vice Presidents of R&D Assaf Zomet and
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`Anton Bar—have been actively communicating and meeting with potential partners and
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`licensees since HumanEyes was founded in 2000. Id. These licensing efforts related to the
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`technologies protected by the Asserted Patents have involved meetings with dozens of
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`companies, including meetings and communications with representatives of Sony as early as
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`2004 and as recently as 2010. Levy-Ron Decl. at ¶ 6; Motion Ex. E (ITC Complaint) at ¶¶ 62-
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`63. However, since Sony’s infringement of the asserted patents began in 2010, Sony’s
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`infringement was the explicit reason given by at least one potential licensee for ending promising
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`negotiations with HumanEyes and is believed to have negatively affected negotiations with other
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`potential licensees as well. Levy-Ron Decl. at ¶ 8; Motion Ex. E (ITC Complaint) at ¶ 63.
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`Sony’s ongoing infringement continues to harm HumanEyes’ business interests even
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`today. Levy-Ron Decl. at ¶¶ 8-9. Uncertainty regarding HumanEyes’ intellectual property and
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`Sony’s infringement hinders HumanEyes’ ability to solicit capital investments from potential
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`investors. Id. at ¶ 9.
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`HumanEyes is a small business of only 15 employees. Id. at ¶ 11. In fact, a recent
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`substantial reduction in force eliminated eight employees and was attributable in part to
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`HumanEyes’ inability to license the patented technology in the face of the uncertainty caused by
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`Sony’s infringement. Id. Given HumanEyes’ small size relative to the Sony defendants, the
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`costs associated with further delaying this litigation weigh particularly hard on HumanEyes,
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`{00745553;v1}
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`especially the opportunity cost of dedicating substantial employee time to pursuing this litigation
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`rather than pursuing HumanEyes’ other business interests. Id. at ¶¶ 8-11. These costs led to a
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`reduction of HumanEyes’ revenue and are forecasted to make up a substantial portion of
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`HumanEyes’ expenses for 2013. Id. at ¶ 10. Additional facts and details regarding the prejudice
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`caused to HumanEyes are provided in the declaration of HumanEyes’ CEO, Vered Levy-Ron,
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`filed herewith.
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`IV. ARGUMENT: ALL THREE TRADITIONAL FACTORS WEIGH HEAVILY
`AGAINST STAYING THIS ACTION
`
`To determine whether to put aside the standard scheduling procedure of the Federal Rules
`
`and this Court’s Local Rules and delay the just and speedy resolution of a plaintiff’s claims in
`
`response to a defendant’s motion for a stay, this Court looks to three important factors: (1) the
`
`stage of the litigation, including the resources already expended by the parties, whether the
`
`parties have already engaged in substantial discovery, whether discovery is complete, and
`
`whether a trial date has been set; (2) whether the requested stay is likely to meaningfully simplify
`
`the issues in question and trial of the case; and (3) whether the requested stay would unduly
`
`prejudice or present a clear tactical disadvantage to the plaintiff, including (a) the timing of the
`
`underlying IPR petition (or other request for post-grant review), (b) the timing of the motion for
`
`stay, (c) the status of the IPR (or other post-grant review) proceedings, and (d) the relationship
`
`between the parties as well as the related question of whether the plaintiff’s injuries may be
`
`compensated through future money damages. Imagevision.net v. IPX, Inc., Civil Action No. 12-
`
`054, D.I. 65 (D. Del. April 22, 2013) at 3-10; see also, e.g., Boston Scientific Corp. v. Cordis
`
`Corp., 777 F. Supp. 2d 783, 789 (D. Del. 2011); First Am. Title Ins. Co. v. Maclaren LLC, 2012
`
`U.S. Dist. LEXIS 31508 at *13; Xerox Corp. v. 3Com Corp., 69 F. Supp. 2d 404, 406 (W.D.N.Y.
`
`1999). Courts, including this District, have repeatedly denied motions for stays based on IPR
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`{00745553;v1}
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`8
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`petitions and similar post-grant review requests and proceedings when one or more of these three
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`factors weighed against a stay.5
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`As further detailed below, all three of the factors in this case weigh heavily against
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`Sony’s request for additional delay and Sony’s Motion should be denied.
`
`
`5 See, e.g., Imagevision.net v. IPX, Inc., Civil Action No. 12-054 D.I. 65 (D. Del. April 22, 2013)
`(upholding Magistrate’s denial of stay based on the completion of substantial discovery
`including production of 38,000 pages of documents; the speculative nature of reexamination
`proceedings, and prejudice caused by competition between the parties); Shurtape Techs. v. 3M
`Co., 2013 U.S. Dist. LEXIS 28815 at *6-14 (W.D.N.C. Mar. 1, 2013) (denying the stay because
`of the prejudice that could result due to the superior resources of the requesting party and the
`lack of evidence that reexamination would resolve all issues for trial); SenoRx, Inc. v. Hologic,
`Inc., 2013 U.S. Dist. LEXIS 8044 at *6-36 (D. Del. January 11, 2013) (denying stay because of
`prejudice even where simplification of issues and the stage of the case favored stay);
`Tuitionfund, LLC v. Suntrust Banks, 2012 U.S. Dist. LEXIS 144408 at *3-7 (M.D. Tenn. Oct. 5,
`2012) (denying stay because of progress of discovery, risk of loss of evidence and fading
`memories due to delay, and lack of proof that reexamination will simplify issues for trial);
`Interwoven, Inc. v. Vertical Comp. Systems, 2012 U.S. Dist. LEXIS 30946 at *6-12 (N.D. Cal.
`Mar. 8, 2012) (denying stay because of 15 month delay in filing for reexamination; direct
`competition; possibility that evidence, witness availability, and memory may become stale; lack
`of evidence that reexamination will resolve all claims; and progress of the litigation); LG
`Electronics U.S.A. v. Whirlpool Corp., 2011 U.S. Dist. LEXIS 11488 at * 2-3 (D.N.J. Feb. 4,
`2011) (denying stay because considerable discovery had been completed, the parties were
`competitors, and the unlikelihood that reexamination would resolve all claims); Affinity Labs of
`Texas v. Nike, Inc., 2011 U.S. Dist. LEXIS 51665 at *4-7 (N.D. Cal. May 13, 2011) (denying
`stay solely because of nine month delay in filing reexamination request, even where other factors
`were neutral or favored stay); Quest Software v. Centrify Corp., 2011 U.S. Dist. LEXIS 28902 at
`*11-14 (D. Utah Mar. 21, 2011) (denying stay because of prejudice from ongoing infringement
`and lack of evidence of issue simplification even though the stage of the case favored a stay);
`Alps South, LLC v. Ohio Willow Wood Co., 2010 U.S. Dist. LEXIS 144260 at *4-5 (M.D. Fla.
`June 16, 2010) (denying a stay because of a nine month delay in filing reexamination request,
`unlikelihood that all trial issues would be resolved by reexamination, and the completion of
`significant discovery); Ultra Prods. v. Antec, Inc., 2010 U.S. Dist. LEXIS 50096 at *12-16 (N.D.
`Cal. Apr. 26, 2010) (rejecting a stay based on two year delay in seeing reexamination, mere
`speculation that reexamination could simplify issues for trial, and two years of litigation
`progress); Esco Corp. v. Berkeley Forge & Tool, Inc., 2009 U.S. Dist. LEXIS 94017 at *6-12
`(N.D. Cal. Sept. 28, 2009) (denying stay because of defendant’s seven month delay in filing for
`reexamination and because of skepticism that lengthy reexamination would resolve all claims
`even though the stage of the case favored a stay).
`
`{00745553;v1}
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`9
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`A.
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`The Significant Resources Already Expended by The Parties, Including the
`Completion of Liability Fact Discovery, Demonstrate This Case is Far Along
`and Ready For Prompt Resolution Before This Court
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`Consideration of the “stage of the litigation” factor requires a more flexible approach
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`than merely determining whether discovery is complete and a trial date has been set.
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`Imagevision.net, Civil Action No. 12-054, D.I. 65 at 9-10. Rather, the analysis of this factor
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`should focus on whether “the Court and the parties have already expended significant resources
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`on the litigation” such that “the principle of maximizing the use of judicial and litigant resources
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`is best served by seeing the case through to its conclusion.” Id. (citing SenoRx 2013 U.S. Dist.
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`LEXIS 8044 at *16-17). In Imagevision.net, this Court upheld a finding that ongoing discovery,
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`including the production of almost 38,000 pages of documents in response to document requests,
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`constituted sufficient investment in the litigation to find that this factor weighs against a stay.
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`In this case—and in direct contrast to Sony’s characterization in its Motion that “this case
`
`has not progressed beyond the early pleading stage”—the parties have produced over 550,000
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`pages of documents (nearly 15 times the number of documents produced in Imagevision.net);
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`completed all 30(b)(6) depositions and conducted depositions of at least 22 deponents (including
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`all of both parties’ 30(b)(6) depositions); propounded and responded to over 700 written
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`discovery requests; and negotiated and completed email discovery according to agreed upon
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`custodians and search terms. See Gerrity Decl. ¶¶ 1.
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`This massive investment by the parties in discovery in the ITC Investigation represents
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`effectively all necessary liability fact discovery for the case before this Court—including all fact
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`discovery regarding infringement and validity and much of the necessary discovery regarding
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`damages and willfulness—and stands ready to be reproduced by the parties in this action
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`following the entry of a protective order. In fact, the only remaining discovery necessary in this
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`case is minimal supplemental discovery regarding, for example: damages based on sales of the
`
`{00745553;v1}
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`10
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`accused Sony products since the close of the ITC Investigation; and Sony’s willful infringement
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`of the asserted patents that exists beyond the discovery regarding copying that was already
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`obtained in the ITC Investigation.
`
`Extensive investment in fact discovery is not the only indicator that this litigation is at an
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`advanced stage. Prior to the termination of the ITC Investigation, the parties also had already
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`exchanged detailed infringement and invalidity contentions and responses to those contentions.
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`The parties had completed most of the preliminary Markman tasks, including exchanging lists of
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`claim terms believed to require construction and proposed constructions for the disputed terms,
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`and identifying the intrinsic and extrinsic evidence the parties intend to rely on to support those
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`proposed constructions. Gerrity Decl. ¶¶ 2. Indeed, when the ITC Investigation was stayed over
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`seven months ago on the final day of fact discovery, the parties were preparing to file initial
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`expert reports on infringement and invalidity in three weeks, ready to complete expert discovery
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`within two months, and anticipating the presentation of their cases at trial in the ITC in four
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`months. See Ex. 2.
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`Because Sony committed to remove the accused functionality from its new products,
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`there should be no new developments requiring additional liability fact discovery into the key
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`issues of infringement. And because the purported prior art identified by Sony in its IPR
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`petitions is materially the same art already litigated in the ITC, there is no reason to believe that
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`any additional fact discovery relating to invalidity is necessary if this case proceeds now. The
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`parties were already poised for the completion of expert discovery within a two-month
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`timeframe and for presentation of their cases at trial within four months and HumanEyes expects
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`that a similarly expedited resolution of the parties claims can be pursued before this Court. The
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`only additional issues that need to be addressed before this Court are (1) the preparation and
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`{00745553;v1}
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`11
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`presentation of Markman briefing and arguments to this Court (which can proceed immediately
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`given that the parties have already exchanged proposed constructions and anticipated support);
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`(2) limited supplemental discovery as described above.
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`These and other substantial investments already made in this case—together with the
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`parties’ readiness to proceed to trial on a highly expedited schedule—demonstrate that the parties
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`have already expended significant resources on the litigation and that the principle of
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`maximizing the use of judicial and litigant resources is best served by seeing this case through to
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`its conclusion. See Imagevision.net, Civil Action No. 12-054, D.I. 65 (citing SenoRx, Inc. v.
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`Hologic, Inc., 2013 U.S. Dist. LEXIS 8044 at *16-17 (D. Del. January 11, 2013)). Indeed, given
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`that the parties were prepared to present their arguments at trial within four months, this case can
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`be well on its way to resolution by this Court as early as October 2013 (when the PTAB will
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`determine whether, and to what extent, even to grant Sony’s IPR petitions), and certainly before
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`April 2015 (when the PTAB will be required to issue its decision if an IPR is g