Case 3:18-cv-06739-JST Document 96 Filed 04/29/19 Page 1 of 12
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`UNITED STATES DISTRICT COURT
`
`NORTHERN DISTRICT OF CALIFORNIA
`
`UNILOC USA INC, et al.,
`
`Plaintiffs,
`
`v.
`
`LG ELECTRONICS U.S.A. INC., et al.,
`
`Defendants.
`
`UNILOC USA INC, et al.,
`
`Plaintiffs,
`
`v.
`
`LG ELECTRONICS U.S.A. INC., et al.,
`
`Case No. 18-cv-06737-JST
`
`
`ORDER GRANTING MOTION TO
`STAY PROCEEDINGS PENDING
`RESOLUTION OF IPR
`
`Re: ECF No. 85
`
`Case No. 18-cv-06739-JST
`
`
`
`
`
`Re: ECF No. 73
`
`Defendants.
`
`
`
`UNILOC USA INC, et al.,
`
`Plaintiffs,
`
`v.
`
`LG ELECTRONICS U.S.A. INC., et al.,
`
`Defendants.
`
`Case No. 18-cv-06740-JST
`
`
`
`
`
`Re: ECF No. 77
`
`
`
`Before the Court are Defendants’ motions to stay proceedings pending resolution of their
`
`petitions for inter partes review (“IPR”) of the patents asserted in these actions. No. 18-cv-06737-
`
`JST, ECF No. 85.1 Plaintiffs oppose the motions. ECF No. 94. For the reasons set forth below,
`
`
`1 Defendants have filed identical motions in No. 18-cv-06739-JST, ECF No. 73, and No. 18-cv-
`06740-JST, ECF No. 77. Given that the parties have also filed identical briefs on each motion, the
`Court uses ECF citations from case number 18-cv-06737-JST, unless otherwise indicated.
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`Northern District of California
`
`United States District Court
`
`IPR2020-00038
`MM EX1026, Page 1
`
`

`

`Case 3:18-cv-06739-JST Document 96 Filed 04/29/19 Page 2 of 12
`
`
`
`the motions are GRANTED.
`
`I.
`
`BACKGROUND
`
`On March 9, 2018, Plaintiffs Uniloc USA, Inc. and Uniloc Luxembourg S.A. (collectively,
`
`“Uniloc”) filed these three patent infringement cases against LG Electronics, Inc., LG Electronics,
`
`U.S.A., and LG Electronics MobileComm U.S.A., Inc. (collectively, “LGE”) in the Northern
`
`District of Texas. ECF No. 1. In each case, Uniloc alleges that LGE electronic devices
`
`implementing 3G, LTE, Bluetooth, and HPSA/HPSA+ standards infringe one of Uniloc’s patents:
`
`(1) U.S. Patent No. 6,868,079 (“the ’079 patent”), see No. 18-cv-06737-JST, ECF No. 28 ¶ 16;
`
`(2) U.S. Patent No. 7,020,106 (“the ’106 patent”), see No. 18-cv-6739-JST, ECF No. 27 ¶ 23; and
`
`(3) U.S. Patent No. 7,167,487 (“the ’487 patent”), see No. 18-cv-06740-JST, ECF No. 30 ¶ 24.
`
`All three cases were transferred to this district in November 2018. ECF No. 46. The Court related
`
`the cases on January 15, 2019, ECF No. 74, and joined Uniloc 2017 LLC as Plaintiff on February
`
`19, 2019. ECF No. 83.
`
`LGE2 has petitioned the United States Patent and Trademark Office (“PTO”) for inter
`
`partes review of the ’079, ’106, and ’487 patents. ECF No. 85 at 6. On November 12, 2018, LGE
`
`filed two IPR petitions challenging claims of the ’106 patent. See IPR2019-00219 (claims 15-18);
`
`IPR2019-00220 (claims 15, 17-18). Under the governing statute and its own regulations, the PTO
`
`is due to determine whether to institute IPR on these petitions by May 20, 2019. ECF No. 85 at 6;
`
`see also 35 U.S.C. §§ 313-314; 42 C.F.R. §§ 42.106-.107.
`
`On the same day, LGE submitted two more IPR petitions challenging claims of the ’487
`
`patent. See IPR2019-222 (claims 1-6); IPR2019-00252 (claims 11-13). The PTO’s decision
`
`whether to institute IPR is expected by June 6, 2019. ECF No. 85 at 7. More recently, on March
`
`4, 2019, non-party Microsoft Corp. also petitioned for IPR review of the same claims of the ’487
`
`patent, asserting additional grounds why those claims are invalid. See IPR2019-00744 (claims 1-
`
`6); IPR2019-00745 (claims 11-13). At the latest, the PTO would render an institution decision on
`
`Microsoft’s petitions by September 28, 2019.
`
`
`2 LGE filed its petitions with non-parties Apple, Inc., Samsung Electronics Co. Ltd., and Samsung
`Electronics America, Inc..
`
`2
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`Northern District of California
`
`United States District Court
`
`IPR2020-00038
`MM EX1026, Page 2
`
`

`

`Case 3:18-cv-06739-JST Document 96 Filed 04/29/19 Page 3 of 12
`
`
`
`Finally, on January 10, 2019, LGE filed an IPR petition seeking review of claims 17 and
`
`18 of the ’079 patent. IPR2019-00510. A response from the PTO is due by August 21, 2019.
`
`On March 8, 2019, LGE filed these motions to stay proceedings until the seven IPR
`
`petitions described above have been resolved. ECF No. 85.
`
`Under the current case schedule, LGE’s invalidity contentions are due by May 13, 2019.
`
`Id. at 11. A scheduling order for claim construction has been issued, with a claim construction
`
`discovery cut-off of August 19, 2019, and the Markman hearing calendared for November 4, 2019.
`
`ECF No. 93. No further dates are set.
`
`II.
`
`LEGAL STANDARD
`
`“Courts have inherent power to manage their dockets and stay proceedings, including the
`
`authority to order a stay pending conclusion of a PTO reexamination.” Ethicon, Inc. v. Quigg, 849
`
`F.2d 1422, 1426-27 (Fed. Cir. 1988) (internal citations omitted). In determining whether to stay a
`
`case pending review by the PTO, courts consider the following factors: (1) whether discovery in
`
`the case is complete and whether a trial date has been set; (2) whether a stay would 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. In re Cygnus Telecomms. Tech., LLC, Patent
`
`Litig., 385 F. Supp. 2d 1022, 1023 (N.D. Cal. 2005); see also Murata Mach. USA v. Daifuku Co.,
`
`830 F.3d 1357, 1361 (Fed. Cir. 2016) (applying the framework applicable to motions to stay
`
`pending reexamination by the PTO to motions to stay pending the newer inter partes review
`
`process). While case law supplies these general considerations, the Court ultimately must decide
`
`whether to issue a stay on a case-by-case basis. Asetek Holdings, Inc. v. Cooler Master Co., Ltd.,
`
`No. 13-cv-00457-JST, 2014 WL 1350813, at *1 (N.D. Cal. Apr. 3, 2014).
`
`III. DISCUSSION
`
`A.
`
`Stage of the Proceedings
`
`The first factor asks the Court to consider the progress already made in the case, such as
`
`the completion of discovery, the setting of a trial date, or whether claim construction has occurred.
`
`Universal Elecs., Inc. v. Universal Remote Control, Inc., 943 F. Supp. 2d 1028, 1031 (C.D. Cal.
`
`2013). Although courts generally evaluate the state of the litigation at the time the motion to stay
`
`3
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`Northern District of California
`
`United States District Court
`
`IPR2020-00038
`MM EX1026, Page 3
`
`

`

`Case 3:18-cv-06739-JST Document 96 Filed 04/29/19 Page 4 of 12
`
`
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`was filed, they may also consider subsequent progress in the case. GoPro, Inc. v. C&A Mktg.,
`
`Inc., No. 16-CV-03590-JST, 2017 WL 2591268, at *3 (N.D. Cal. June 15, 2017); see also
`
`VirtualAgility Inc. v. Salesforce.com, Inc., 759 F.3d 1307, 1317 & n.6 (Fed. Cir. 2014).
`
`Here, the parties agree that “very little discovery” has occurred. ECF No. 94 at 6; ECF No.
`
`96 at 6. Indeed, when LGE filed these motions, the Court had yet to issue a scheduling order. Cf.
`
`ECF No. 93. Although the Court may take into account the deadlines it subsequently set, see
`
`GoPro, 2017 WL 2591268, at *3, the fact remains that those deadlines are not imminent. Claim
`
`construction discovery closes more than five months after the stay motion was filed, a Markman
`
`hearing is set for almost eight months from that same filing date, and there is no trial scheduled.
`
`ECF No. 93. LGE has not yet served its invalidity contentions, and the parties have not yet begun
`
`claim construction proceedings. See generally Patent L.R. 4.3
`
`The Court has previously found that this factor weighed in favor of a stay in cases where
`
`the parties had invested far more resources and moved their cases closer to resolution than is the
`
`case here. In GoPro, for instance, “the parties had already exchanged infringement and invalidity
`
`contentions and made their corresponding document productions under Patent Local Rules 3-2 and
`
`3-4, exchanged written discovery, and made their initial claim construction disclosures.” 2017
`
`WL 2591268, at *3. And after the motion was filed, “the parties provided their respective
`
`technology tutorials and the Court expended resources in reviewing the parties’ claim construction
`
`disclosures and preparing for the tutorial and Markman hearing.” Id. Nonetheless, the Court
`
`concluded that the case was “in its early stages,” relying on the more burdensome nature of the
`
`remaining discovery and the lack of a schedule for dispositive motions or a trial date. Id.
`
`Similarly, in SAGE Electrochromics, Inc. v. View, Inc., the parties had “exchanged
`
`documents, responded to discovery requests, litigated a discovery dispute, underwent claim
`
`construction for four patents, and briefed claim construction on the remaining five patents.” No.
`
`12-CV-06441-JST, 2015 WL 66415, at *2 (N.D. Cal. Jan. 5, 2015). The Court reached the same
`
`
`3 The parties dispute, with little discussion and without any supporting evidence, whether LGE has
`served invalidity contentions. ECF No. 94 at 6; ECF No. 96 at 7 n.3. Given that Uniloc is the
`party attempting to prove that this event occurred, the Court resolves this dispute in LGE’s favor
`and assumes for purposes of this motion that LGE has not served invalidity contentions.
`4
`
`Northern District of California
`
`United States District Court
`
`IPR2020-00038
`MM EX1026, Page 4
`
`

`

`Case 3:18-cv-06739-JST Document 96 Filed 04/29/19 Page 5 of 12
`
`
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`conclusion. Id.; see also Cypress Semiconductor Corp. v. GSI Tech., Inc., No. 13-CV-02013-JST,
`
`2014 WL 5021100, at *2 (N.D. Cal. Oct. 7, 2014) (finding factor supported stay where “the Court
`
`has not set dates for the close of fact or expert discovery, no depositions have been taken or
`
`scheduled, little expert discovery has been conducted, claim construction has only occurred with
`
`respect to the patents that are not the subject of this motion, and no dispositive motions have been
`
`scheduled or heard.”).
`
`Uniloc’s emphasis on the “substantial efforts” already invested by both parties does not
`
`distinguish this case. ECF No. 94 at 6-7. Uniloc cites resources expended on motions regarding
`
`preliminary motions to transfer, to substitute a party, and to consolidate these cases, id., but even
`
`assuming those efforts were “substantial,” the parties have barely begun to address the merits of
`
`Uniloc’s claims. The Court also finds that the parties’ efforts related to LGE’s motions to dismiss
`
`do not weigh against a stay. As LGE notes, Uniloc has twice responded by filing (or requesting
`
`leave to file) an amended complaint, ECF Nos. 28, 90, and so no court has reached the merits of
`
`the issues raised by these motions. Cf. Symantec Corp. v. Zscaler, Inc., No. 17-CV-04426-JST,
`
`2018 WL 3539267, at *2 (N.D. Cal. July 23, 2018) (finding that this factor favored a stay even
`
`where the Court had already “ruled on one motion to dismiss and a motion for judgment on the
`
`pleadings”). To the extent that Uniloc believes that its efforts on this front will be wasted, Uniloc
`
`is at least partly at fault for adopting this seemingly inefficient approach. See SAGE, 2015 WL
`
`66415, at *3 (rejecting prejudice argument because “as a result of its continued amendments to its
`
`complaint and infringement contentions, [plaintiff] bears some responsibility for the already-
`
`protracted length of the litigation”).
`
`This factor accordingly weighs in favor of stay.
`
`B.
`
`Simplification of the Issues and Trial in this Case
`
`The next factor asks the Court to examine whether and to what degree a stay will simplify
`
`the litigation. PersonalWeb Techs., LLC v. Facebook, Inc., No. 5:13-CV-01356-EJD, 2014 WL
`
`116340, at *4 (N.D. Cal. Jan. 13, 2014).
`
`Uniloc does not dispute that the IPR petitions collectively challenge every claim asserted
`
`in these three cases. ECF No. 85 at 10; cf. ECF No. 94 at 5-6. Accordingly, resolution of these
`
`5
`
`Northern District of California
`
`United States District Court
`
`IPR2020-00038
`MM EX1026, Page 5
`
`

`

`Case 3:18-cv-06739-JST Document 96 Filed 04/29/19 Page 6 of 12
`
`
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`petitions has significant potential to simplify this litigation. The Patent Trial and Appeal Board
`
`(“PTAB”) may cancel all of the asserted claims of one or more patents, thereby mooting one or
`
`more of these cases. Further, “[i]n the event the PTAB cancels or modifies any of the asserted
`
`claims” in a patent, it would still narrow and simplify the scope of the case involving that patent.
`
`PersonalWeb Techs., 2014 WL 116340, at *4. Finally, “[e]ven if the PTAB affirms the validity of
`
`every asserted claim, which is highly unlikely given the new higher standard for instituting IPR,
`
`these cases would still benefit as such a strong showing would assist in streamlining the
`
`presentation of evidence and benefit the trier of fact by providing the expert opinion of the PTO.”
`
`Id.
`
`LGE offers two reasons why IPR decisions have become more beneficial to district courts
`
`in recent years. First, the Federal Circuit has held, consistent with the prior view of many district
`
`courts, that “statements made by a patent owner during an IPR proceeding can be relied on to
`
`support a finding of prosecution disclaimer during claim construction.” Aylus Networks, Inc. v.
`
`Apple Inc., 856 F.3d 1353, 1359 (Fed. Cir. 2017); see also id. at 1361 & n.3 (collecting district
`
`court cases). Second, as of November 13, 2018, the PTAB employs “the same claim construction
`
`standard that would be used to construe the claim in a civil action” before this Court, 37 C.F.R.
`
`§ 42.100(b), rather than the “broadest reasonable construction” standard that previously governed
`
`IPR proceedings. 37 C.F.R. § 42.100(b) (2016). Because this standard applies to LGE’s IPR
`
`petition for the ’079 patent and Microsoft’s IPR petitions for the ’487 patent, LGE reasons that the
`
`PTAB’s claim construction in those proceedings will be even more instructive. ECF No. 96 at 8-
`
`9.
`
`While these developments appear to enhance the potential for IPR proceedings to simplify
`
`litigation, this benefit still hinges on the PTO’s forthcoming decisions whether to actually institute
`
`IPR. Courts, including this one, have recognized that “the filing of an IPR request by itself does
`
`not simplify the issues in question and trial of the case. Ultimately, the PTO may not institute IPR
`
`proceedings.” TPK Touch Solutions, Inc. v. Wintek Electro-Optics Corp., No. 13–CV–02218–
`
`JST, 2013 WL 6021324, at *4 (N.D. Cal. Nov. 13, 2013); see also DiCon Fiberoptics, Inc. v.
`
`Precisely Microtechnology Corp., No. 15-cv-01362-BLF, 2015 WL 12859346, at *2 (N.D. Cal.
`
`6
`
`Northern District of California
`
`United States District Court
`
`IPR2020-00038
`MM EX1026, Page 6
`
`

`

`Case 3:18-cv-06739-JST Document 96 Filed 04/29/19 Page 7 of 12
`
`
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`Oct. 13, 2015) (finding that “the question of whether a stay will simplify and streamline the issues
`
`in this litigation depends entirely on whether the PTAB decides to grant the IPR petition”).
`
`This Court’s temporary stay in Grobler v. Apple Inc., No. 12-cv-01534-JST (N.D. Cal.
`
`June 6, 2013), ECF No. 67, is not to the contrary. There, the claim construction process was
`
`“imminent,” with the Markman hearing scheduled for July 23, 2013. Grobler, ECF No. 52. As
`
`the Court has emphasized in another case, given that the PTO’s institution decision in Grobler was
`
`set to issue the day before that hearing, “the Court found it prudent in that case to wait for the
`
`institution decision rather than holding a Markman hearing a day after the institution decision.”
`
`GoPro, 2017 WL 2591268, at *4. That is not the situation here.
`
`LGE further argues that, even if the PTO does not institute IPR, a stay is still appropriate
`
`because the Federal Circuit’s Aylus decision holds that prosecution disclaimer may also be based
`
`on the patentee’s statements “in a preliminary response [opposing IPR] before the Board issued its
`
`institution decision.” 856 F.3d at 1361. The Court concludes, however, that the possibility that
`
`one potential claim construction argument will emerge from the patentee’s preliminary response is
`
`too speculative to independently support a stay.4
`
`Thus, as a general matter, the Court is not inclined to give substantial weight to this factor
`
`until the PTO has actually decided to institute review. However, there are at least three reasons to
`
`do so here. First, the requested stay presents the maximum potential for simplification of issues,
`
`as all the asserted claims are challenged in the IPR petitions. This high upside mitigates to some
`
`extent the risk that the PTO will deny review. Second, given the degree to which the PTO’s
`
`decisions may impact these cases, it would be particularly wasteful to require the parties to
`
`proceed with preparations and filings that may be reshaped or entirely mooted a short while later.
`
`For example, LGE’s invalidity contentions are due May 13, 2019, ECF No. 85 at 11 – one week
`
`
`4 The Court notes, moreover, that LGE cites no authority applying Aylus to justify a pre-institution
`stay. LGE’s argument is further undermined by the fact that Uniloc has already filed preliminary
`responses to LGE’s petitions on the ’106 patent and the ’487 patent on February 20, 2019, and
`March 6, 2019, respectively. See IPR2019-00219; IPR2019-00220; IPR2019-00222; IPR2019-
`00252. To the extent those responses support prosecution disclaimer, LGE already has them. For
`the ’079 patent, Uniloc’s preliminary response is due May 21, 2019, at the outset of the claim
`construction process. IPR2019-00510.
`
`
`7
`
`Northern District of California
`
`United States District Court
`
`IPR2020-00038
`MM EX1026, Page 7
`
`

`

`Case 3:18-cv-06739-JST Document 96 Filed 04/29/19 Page 8 of 12
`
`
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`before the PTO’s institution decision on ’106 patent petitions, id. at 6.5 Finally, the PTO’s
`
`decisions on LGE’s petitions are expected May 20, June 6, and August 21, 2019. A temporary
`
`stay of less than four months until the PTO makes its decisions will cause relatively little delay to
`
`this case or prejudice to the parties.
`
`In these circumstances, other courts in this district have found that the potential for
`
`simplification outweighs the uncertainty inherent in a pre-institution stay. In Delphix Corp. v.
`
`Actifio, Inc., the court emphasized that “the patents subject to IPR are a significant portion of this
`
`action,” and reasoned that, “[a]t a minimum, instituting a brief, limited stay of approximately five
`
`months to see whether and how the PTAB will act on Defendant’s IPR petitions will conserve
`
`judicial resources and avoid inconsistent results.” No. 13-CV-04613-BLF, 2014 WL 6068407, at
`
`*2 (N.D. Cal. Nov. 13, 2014). The PersonalWeb Technologies court likewise confronted a
`
`situation where “nearly all the claims asserted . . . [we]re subject or potentially subject to some
`
`form of PTO scrutiny.” 2014 WL 116340, at *4. The court concluded that the pre-institution
`
`status of some petitions did not “outweigh[] the anticipated simplification afforded by a stay,”
`
`particularly in light of the “relatively short” three month delay until the PTO issued its institution
`
`decisions. Id. These same considerations support a stay here.
`
` Finally, the Court notes that LGE seeks a stay pending Microsoft’s IPR petitions regarding
`
`the ’487 patent. ECF No. 85 at 5, 7. If the PTO institutes IPR on those petitions (but not the ’487
`
`patent petitions filed by LGE), LGE will not be statutorily estopped from asserting the Microsoft’s
`
`invalidity arguments before this Court, thereby frustrating in part the purpose of a stay. See
`
`PersonalWeb Techs., 2014 WL 116340, at *5 (citing 35 U.S.C. § 315(e)(2)). Under these
`
`circumstances, courts have “alleviate[d] any estoppel concern as to these defendants by using
`
`[their] inherent power to condition a stay on [defendants’] agreement to be bound as if they
`
`themselves had filed the relevant IPR petition.” Id.; see also Capella Photonics, Inc. v. Cisco Sys.,
`
`
`5 LGE also argues that it shoulders a disproportionate discovery burden because Uniloc is a non-
`practicing entity (“NPE”) that does not make or sell products. ECF No. 85 at 12. Although
`Uniloc’s NPE status is relevant to whether it will suffer irreparable harm during a stay, the Court
`does not see how it pertains to whether a stay will simplify the issues. Moreover, the Supreme
`Court’s discussion of NPEs filing frivolous cases, Commil USA, LLC v. Cisco Sys., Inc., 135 S. Ct.
`1920, 1930-31 (2015), does not shed light on the merits of Uniloc’s opposition to this motion.
`8
`
`Northern District of California
`
`United States District Court
`
`IPR2020-00038
`MM EX1026, Page 8
`
`

`

`Case 3:18-cv-06739-JST Document 96 Filed 04/29/19 Page 9 of 12
`
`
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`Inc., No. C-14-3348 EMC, 2015 WL 1006582, at *3 (N.D. Cal. Mar. 6, 2015). LGE has filed a
`
`stipulation agreeing to such a condition. ECF No. 107 at 2. Accordingly, this factor supports a
`
`stay pending Microsoft’s IPR petitions as well.
`
`The Court therefore concludes that, on these facts, this factor weighs slightly in favor of a
`
`stay.
`
`C.
`
`Prejudice to Non-Moving Party
`
`The last factor is “whether a stay would unduly prejudice or present a clear tactical
`
`disadvantage to the non-moving party.” TPK Touch Solutions, Inc., 2013 WL 6021324, at *4
`
`(citing KLA–Tencor Corp. v. Nanometrics, Inc., No. 05–cv–03116–JSW, 2006 WL 708661, at *3
`
`(N.D. Cal. Mar. 16, 2006)). In weighing the prejudice to the non-moving party, courts consider
`
`four sub-factors: “(1) the timing of the petition for review; (2) the timing of the request for the
`
`stay; (3) the status of review proceedings; and (4) the relationship of the parties.” Cypress
`
`Semiconductor Corp. v. GSI Tech., Inc., No. 12-cv-02013-JST, 2014 WL 5021100 at *3 (N.D.
`
`Cal. Oct. 7, 2014). “Speculation that evidence will be lost, without more, is insufficient to
`
`demonstrate undue prejudice.” Evolutionary Intelligence, LLC v. Millenial Media, Inc., No. 5:13-
`
`cv-04206-EJD, 2014 WL 2738501, at *6 (N.D. Cal. June 11, 2014); see also Software Rights
`
`Archive, LLC v. Facebook, Inc., No. C-12-3970 RMW, 2013 WL 5225522, at *5 (N.D. Cal. Sept.
`
`17, 2013) (“Delay alone, without specific examples of prejudice resulting therefrom, is insufficient
`
`to establish undue prejudice.”).
`
`1.
`
`Timing of IPR Request
`
`The Court first considers the timing of the petition for review. This Court “expects
`
`defendants to evaluate whether to file, and then to file, IPR petitions as soon as possible after
`
`learning that a patent may be asserted against them.” TPK Touch Solutions, Inc., 2013 WL
`
`6021324, at *4. If delay is the result of an accused infringer exercising diligence in researching
`
`the asserted patents and preparing its IPR filing, this does not unduly prejudice the patent owner.
`
`Id.
`
`Here, LGE filed four petitions for IPR review on November 12, 2018, seven months after
`
`Uniloc filed its complaints, and a fifth petition on January 10, 2019. ECF No. 85 at 6-7. This is
`
`9
`
`Northern District of California
`
`United States District Court
`
`IPR2020-00038
`MM EX1026, Page 9
`
`

`

`Case 3:18-cv-06739-JST Document 96 Filed 04/29/19 Page 10 of 12
`
`
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`within the one-year statutory limit. See SAGE, 2015 WL 66415, at *3 (“Delay alone [within the
`
`statutory deadline] does not usually constitute undue prejudice because parties having protection
`
`under the patent statutory framework may not complain of the rights afforded to others by that
`
`same statutory framework.” (alteration in original) (quoting Asetek, 2014 WL 1350813, at *4)).
`
`Although Uniloc claims that LGE “could have acted more expeditiously, there is no support for
`
`the contention that [LGE] unduly delayed its filing of the IPR petitions.” SAGE, 2015 WL 66415,
`
`at *3. This subfactor is therefore neutral.
`
`2.
`
`Timing of Motion to Stay
`
`LGE filed its motions to stay on March 8, 2019, roughly four months after the ’106 and
`
`’487 patent petitions and two months after the ’079 patent petition. Uniloc argues that a “routine
`
`motion to stay” pending IPR proceedings “should not take months to prepare and file,” and that
`
`this delay weighs against a stay. ECF No. 94 at 7. LGE counters that these cases were assigned to
`
`different judges when they were initially transferred to this district in November 2018, and that it
`
`waited until this Court resolved Uniloc’s motion to substitute and the question of consolidation.
`
`ECF No. 96 at 11. LGE emphasizes that it filed these motions to stay within three weeks of the
`
`Court’s order on those issues.
`
`The Court agrees that it was reasonable for LGE to wait until it was clear which Uniloc
`
`entities would be opposing this motion and whether the motion would apply to a single
`
`consolidated case. Because nothing in LGE’s “conduct suggests that its decision was tactical” in a
`
`manner designed to disadvantage Uniloc, Asetek, 2014 WL 1350813, at *5, the Court finds this
`
`sub-factor neutral.
`
`3.
`
`Status of IPR Proceedings
`
`Third, the Court considers the status of the IPR proceedings. As discussed above, the PTO
`
`has not yet instituted IPR, but decisions are expected by May 20, 2019 for the ’106 patent, by June
`
`6, 2019 for the ’487 patent, and by August 21, 2019 for the ’079 patent. ECF No. 85 at 6-7.
`
`While this sub-factor weighs against a stay, see SAGE, 2015 WL 66415, at *4 (citing TPK Touch
`
`Solutions, Inc., 2013 WL 6021324, at *5), its weight is lessened by the considerations articulated
`
`above.
`
`10
`
`Northern District of California
`
`United States District Court
`
`IPR2020-00038
`MM EX1026, Page 10
`
`

`

`Case 3:18-cv-06739-JST Document 96 Filed 04/29/19 Page 11 of 12
`
`
`
`4.
`
`Relationship of Parties
`
`Finally, LGE and Uniloc are not competitors. Therefore, Uniloc will not suffer
`
`“irreparable harm” from LGE’s continued use of the accused technology, and “can be fully
`
`restored to the status quo ante with monetary relief.” Software Rights Archive, LLC v. Facebook,
`
`Inc., No. 12-cv-3970-RMW, 2013 WL 5225522, at *6 (N.D. Cal. Sept. 17, 2013). In other words,
`
`“[a] stay will not diminish the monetary damages to which [Uniloc] will be entitled if it succeeds
`
`in its infringement suit – it only delays realization of those damages and delays any potential
`
`injunctive remedy.” VirtualAgility, 759 F.3d at 1318. That Uniloc did not seek injunctive relief
`
`further undercuts its prejudice argument. Id. While Uniloc is correct that neither consideration is
`
`dispositive, both weigh in favor of a stay. See id.; TPK Touch Solutions, Inc., 2013 WL 6021324
`
`at *5.
`
`Against these considerations, Uniloc identifies no specific prejudice that a stay would
`
`impose. Uniloc argues only that the IPR process will delay its ability to assert its patents, relying
`
`on a line of cases from the Eastern District of Texas. ECF No. 94 at 8 (citing, among others, Saint
`
`Lawrence Commc’ns LLC v. ZTE Corp., No. 2:15-CV-349-JRG, 2017 WL 3396399, at *2 (E.D.
`
`Tex. Jan. 17, 2017)). But courts in other districts, including this district, “have long acknowledged
`
`that a delay inherent to a stay does not, in and of itself, constitute prejudice.” Oyster Optics, LLC
`
`v. Ciena Corp., No. 17-CV-05920-JSW, 2018 WL 6972999, at *3 (N.D. Cal. Jan. 29, 2018)
`
`(quoting PersonalWeb Techs., 2014 WL 116340, at *5); see also Wonderland Nursery Goods Co.
`
`v. Baby Trend, Inc., No. EDCV 14-01153-VAP, 2015 WL 1809309, at *4 (C.D. Cal. Apr. 20,
`
`2015) (“While it is true that any delay may be prejudicial to a party filing a claim for patent
`
`infringement, Plaintiff has not shown any unique prejudice beyond what any plaintiff necessarily
`
`experiences when its suit is stayed pending IPR.”); Neste Oil Oyj v. Dynamic Fuels, LLC, No.
`
`CIV.A. 12-662-GMS, 2013 WL 424754, at *2 (D. Del. Jan. 31, 2013) (“The court also recognizes,
`
`however, that the potential for delay does not, by itself, establish undue prejudice.”). Given the
`
`weight of this authority, and the lack of a competitor relationship, the Court finds that this sub-
`
`factor supports a stay.
`
`In sum, the Court finds no undue prejudice or tactical disadvantage to Uniloc,
`
`11
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`Northern District of California
`
`United States District Court
`
`IPR2020-00038
`MM EX1026, Page 11
`
`

`

`Case 3:18-cv-06739-JST Document 96 Filed 04/29/19 Page 12 of 12
`
`
`
`notwithstanding that the PTO has not yet instituted IPR.
`
`CONCLUSION
`
`For the foregoing reasons, the Court grants LGE’s motions to stay these cases pending the
`
`resolution of the seven IPR petitions described above. All pending deadlines established in the
`
`Court’s March 25, 2019 Scheduling Order are stayed. Within seven days of each of the PTO’s
`
`institution decisions, the parties are ordered to file a joint case management statement apprising
`
`the court of the PTO’s decision and requesting such further relief as may be appropriate.
`
`IT IS SO ORDERED.
`
`Dated: April 29, 2019
`
`______________________________________
`JON S. TIGAR
`United States District Judge
`
`12
`
`1
`
`2
`
`3
`
`4
`
`5
`
`6
`
`7
`
`8
`
`9
`
`10
`
`11
`
`12
`
`13
`
`14
`
`15
`
`16
`
`17
`
`18
`
`19
`
`20
`
`21
`
`22
`
`23
`
`24
`
`25
`
`26
`
`27
`
`28
`
`Northern District of California
`
`United States District Court
`
`IPR2020-00038
`MM EX1026, Page 12
`
`