Case 2:22-cv-00486-JRG Document 87 Filed 01/31/24 Page 1 of 19 PageID #: 1133
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`MARSHALL DIVISION
`
`
`
`NORTHSTAR SYSTEMS LLC,
`
`
`Plaintiff,
`
`
`
`v.
`
`
`VOLKSWAGEN AG,
`
`Defendant.
`
`
`
`NORTHSTAR SYSTEMS LLC,
`
`
`Plaintiff,
`
`
`
`v.
`
`
`BAYERISCHE MOTOREN WERKE AG,
`
`Defendant.
`
`
`
`Case No. 2:22-cv-00486-JRG (Lead Case)
`
`JURY TRIAL DEMANDED
`
`
`Case No. 2:22-cv-00496-JRG (Member Case)
`
`JURY TRIAL DEMANDED
`
`Oral Argument Requested
`
`
`DEFENDANT BAYERISCHE MOTOREN WERKE AG’S OPPOSED MOTION TO
`STAY PENDING RESOLUTION OF
`INTER PARTES REVIEW OF THE CHALLENGED PATENTS
`
`
`
`
`
`
`
`
`
`
`
`
`
`

`

`Case 2:22-cv-00486-JRG Document 87 Filed 01/31/24 Page 2 of 19 PageID #: 1134
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`
`
`I.
`
`II.
`
`TABLE OF CONTENTS
`
`Factual Background: All Challenged Claims for Four of The Five Asserted Patents
`Are Instituted and This Case Is in Its Early Stages ............................................................. 1
`
`Legal Standard: Courts Stay Cases Pending IPRs When 1) It Will Simplify the Case
`and Conserve Resources, 2) the Case Is in Its “Relative Infancy,” and 3) the Non-
`Moving Party Will Not Face Undue Prejudice ................................................................... 3
`
`III.
`
`Argument: Staying this Case at its Early Stage Will, Without Prejudicing
`NorthStar, Simplify the Issues and Reduce the Burden on the Court ................................. 4
`
`A.
`
`Factor 1: A stay will simplify the issues before this Court because invalidity
`issues will be disposed of in the IPRs. .................................................................... 5
`
`1.
`
`2.
`
`3.
`
`4.
`
`The litigation will be simplified for at least claim construction, non-
`infringement, and invalidity. ....................................................................... 5
`
`Even if all claims are not invalidated in the IPRs, this case will be
`simplified. ................................................................................................... 8
`
`At very least, the Court will avoid having to rule on BMW’s motion
`to dismiss. ................................................................................................... 9
`
`Because of this simplification, the burden on the parties and Court
`will be greatly reduced by a stay. ................................................................ 9
`
`B.
`
`Factor 2: A stay is warranted because this case is in its early stages with
`significant investment yet to occur, and BMW was diligent. ............................... 10
`
`1.
`
`2.
`
`Significant milestones have yet to occur, favoring a stay to conserve
`judicial and party resources. ..................................................................... 10
`
`BMW was diligent in filing its petitions and this motion. ........................ 11
`
`C.
`
`Factor 3: A stay will not unduly prejudice NorthStar because it is a non-
`practicing entity that waited more than two years to bring suit. ........................... 12
`
`1.
`
`2.
`
`NorthStar will face no undue prejudice. ................................................... 12
`
`BMW will not have a clear tactical advantage. ........................................ 14
`
`IV.
`
`Conclusion: The Court Should Stay This Case in its Entirety, or Alternatively, on
`the Patents Subject to Instituted IPRs ............................................................................... 15
`
`
`
`
`
`ii
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`

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`Case 2:22-cv-00486-JRG Document 87 Filed 01/31/24 Page 3 of 19 PageID #: 1135
`
`
`
`Cases
`
`TABLE OF AUTHORITIES
`
`
`
`Page(s)
`
`Commc’n Techs., Inc. v. Samsung Elecs. Am., Inc.,
`No. 2:21-CV-00444, 2023 WL 1478447 (E.D. Tex. Feb. 2, 2023) ................................. passim
`
`CUPP Computing AS v. Trend Micro Inc.,
`53 F.4th 1376 (Fed. Cir. 2022) ..............................................................................................6, 7
`
`CyWee Grp. Ltd. v. Samsung Elecs. Co.,
`Case No. 2:17-cv-00140, 2019 WL 11023976 (E.D. Tex. Feb. 14, 2019) ...................... passim
`
`EchoStar Techs. Corp. v. TiVo, Inc.,
`No. 5:05-cv-81, 2006 WL 2501494 (E.D. Tex. July 14, 2006) .....................................3, 10, 11
`
`Landis v. N. Am. Co.,
`299 U.S. 248 (1936) ...................................................................................................................3
`
`NFC Tech., LLC v. HTC Am., Inc.,
`No. 2:13-cv-1058, 2015 WL 1069111 (E.D. Tex. Mar. 11, 2015) .................................. passim
`
`Norman IP Holdings, LLC v. TP-Link Techs., Co.,
`Case No. 6:13-cv-384, 2014 WL 5035718 (E.D. Tex. Oct. 8, 2014) .............................. passim
`
`Parallel Networks Licensing, LLC v. Ramquest Software, Inc.,
`No. 4:19-cv-487, 2020 WL 1236266 (E.D. Tex. Mar. 13, 2020) ......................................12, 13
`
`Stingray Music USA, Inc. v. Music Choice,
`Case No. 2:16-CV-00586, 2017 WL 9885167 (E.D. Tex. Dec. 12, 2017) ....................4, 12, 13
`
`Stragent LLC v. BMW of N. Am., LLC,
`No. 6:16-CV-446, 2017 WL 3709083 (E.D. Tex. July 11, 2017) .....................................12, 13
`
`Uniloc 2017 LLC v. LG Elecs. U.S.A., Inc.,
`No. 3:18-CV-3071, 2020 WL 374545 (N.D. Tex. Jan. 23, 2020) ...........................4, 10, 13, 14
`
`Uniloc USA Inc. v. Google Inc.,
`No. 2:17-cv-231, Dkt. 47 (E.D. Tex. Oct. 3, 2017) (Gilstrap, J.) ..........................................8, 9
`
`VirnetX Inc. v. Apple Inc.,
`Civ. Action No. 6:12-cv-00855, 2018 WL 398433 (E.D. Tex. Jan. 12, 2018) ........................14
`
`Statutes
`
`35 U.S.C. § 315(e)(2) .......................................................................................................................7
`
`
`
`

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`Case 2:22-cv-00486-JRG Document 87 Filed 01/31/24 Page 4 of 19 PageID #: 1136
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`
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`A stay would prevent wastefully expending judicial and party resources pending the
`
`outcome of six IPRs filed on the five Asserted Patents in this case. All four factors that this Court
`
`considers favor staying this case. As of January 19, 2024, four of the five Asserted Patents are
`
`subject to instituted IPRs, including all asserted claims for these four patents. Institution decisions
`
`for the fifth patent are expected by March 22, 2024—months before any crucial deadline in this
`
`case. A stay at this early stage would maximize resource conservation.
`
`First, there is a substantial likelihood of simplification of this litigation because the Board
`
`has granted four (soon, two more) IPRs challenging all claims (both asserted and unasserted) of
`
`four (soon, all) of the asserted patents, and the IPRs will reduce or potentially eliminate any burden
`
`parallel litigation would otherwise impose, conserving both party and judicial resources. Second,
`
`this litigation is in its early stages. Neither party has served discovery, and the most burdensome
`
`parts of the case are months away. Third, a stay will not unduly prejudice Plaintiff NorthStar
`
`Systems LLC (“NorthStar”), which itself delayed in filing this action for over two years, despite
`
`pursuing actions against nearly 20 other defendants. Moreover, NorthStar sells no products, and
`
`any speculative harm can be remedied through monetary damages.
`
`In view of the nearly clean-sweep IPRs to date (and forthcoming complete clean-sweep),
`
`the Court should stay this case. In the alternative, even if the Court does not stay the litigation in
`
`its entirety, it should grant a partial stay on the patents currently subject to instituted IPRs. Even if
`
`the Court does not stay this case, entirely or partially, this motion should be denied without
`
`prejudice, so the issue of a stay can be revisited following the final institution decisions in March.
`
`I.
`
`Factual Background: All Challenged Claims for Four of The Five Asserted
`Patents Are Instituted and This Case Is in Its Early Stages
`
`This case, on five total patents, has already been pending for thirteen months, and nothing
`
`substantive has yet occurred. After Defendant Bayerische Motoren Werke AG’s (“BMW’s”)
`
`1
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`

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`Case 2:22-cv-00486-JRG Document 87 Filed 01/31/24 Page 5 of 19 PageID #: 1137
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`
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`successful Motion to Dismiss NorthStar’s original complaint, NorthStar filed an Amended
`
`Complaint on September 19, 2023. Dkt. No. 74. Because NorthStar’s Amended Complaint
`
`changed little about its substantive allegations, BMW filed a motion to dismiss the Amended
`
`Complaint on October 18, 2023, raising similar issues to those in its original, successful motion.
`
`Dkt. No. 80. In view of this pending motion, little has happened in the case, and the Court has not
`
`yet ruled on the pending motion to dismiss.
`
`All major milestones in this case are months away: the Markman hearing is scheduled for
`
`May 16, 2024, the close of fact discovery is July 1, 2024, the close of expert discovery is August
`
`5, 2024, trial is set to begin November 18, 2024. Dkt. No. 70. To date, neither party has served any
`
`discovery requests nor taken any depositions, and briefing for claim construction has not begun.
`
`As of January 19, 2024, all asserted claims of four of the five Asserted Patents are subject
`
`to instituted IPRs. Dkt. No. 86. For the instituted patents, Final Written Decisions are expected on
`
`a rolling basis by November 11, 2024. For the fifth patent, pending institution, Institution
`
`Decisions are expected no later than March 22, 2024,1 and Final Written Decisions are expected
`
`no later than March 24, 2025. In short, all IPR proceedings will conclude by March 24, 2025, at
`
`the latest.
`
`IPR Case No.
`
`Challenged Patent
`
`Institution Date
`
`IPR2023-00890
`
`the ’297 patent
`
`November 9, 2023
`
`IPR2023-00934
`
`the ’527 patent
`
`December 8, 2023
`
`IPR2023-01017
`
`the ’943 patent
`
`December 8, 2023
`
`IPR2023-01190
`
`the ’432 patent
`
`January 19, 2024
`
`Final Written
`Decision Date
`No later than
`November 11, 2024
`No later than
`December 9, 2024
`No later than
`December 9, 2024
`No later than January
`20, 2025
`
`
`
`1 The ’416 patent is subject to two IPRs, which, collectively, challenge all claims.
`
`2
`
`

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`Case 2:22-cv-00486-JRG Document 87 Filed 01/31/24 Page 6 of 19 PageID #: 1138
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`
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`IPR2023-01049
`
`the ’416 patent
`
`IPR2023-01191
`
`the ’416 patent
`
`No later than March
`22, 2024
`No later than March
`22, 2024
`
`No later than March
`24, 2025
`No later than March
`24, 2025
`
`The instituted claims make up over 85% of the claims at issue in this case. In each of these
`
`IPRs, all claims of the Asserted Patents are challenged and instituted, including those not at issue
`
`before the Court. Dkt. No. 82-1 at 2.
`
`Patent
`
`’297 patent
`
`’527 patent
`
`’943 patent
`
`’432 patent
`
`’416 patent
`
`Claims Asserted by
`NorthStar
`1-18, 20-21, 23-26,
`and 28-30
`1, 3-14, 18-20, and
`26-30
`1-18, 20-21, and 23-
`26
`1-2, 4-5, and 7-8
`
`1, 3-6, 9-13, and 17-
`19
`
`Claims Challenged
`at the PTAB
`1-30
`
`Claims Instituted by
`the Board
`1-30
`
`1-30
`
`1-26
`
`1-8
`
`1-35
`
`1-30
`
`1-26
`
`1-8
`
`Institution of claims
`1-35 expected by
`March 22, 2024
`
`
`II.
`
`Legal Standard: Courts Stay Cases Pending IPRs When 1) It Will Simplify the
`Case and Conserve Resources, 2) the Case Is in Its “Relative Infancy,” and 3)
`the Non-Moving Party Will Not Face Undue Prejudice
`
`This Court has broad, inherent authority to stay proceedings to “control the disposition of
`
`the causes on its docket with economy of time and effort for itself, for counsel, and for litigants,”
`
`as determined “on a case-by-case basis.” Landis v. N. Am. Co., 299 U.S. 248, 254 (1936); Norman
`
`IP Holdings, LLC v. TP-Link Techs., Co., Case No. 6:13-cv-384, 2014 WL 5035718, at *2 (E.D.
`
`Tex. Oct. 8, 2014).
`
`Courts generally stay cases when “the benefits of a stay outweigh the inherent costs of
`
`postponing resolution of the litigation.” NFC Tech. LLC v. HTC Am., Inc., No. 2:13-cv-1058, 2015
`
`WL 1069111, at *2 (E.D. Tex. Mar. 11, 2015) (citing EchoStar Techs. Corp. v. TiVo, Inc., No.
`
`5:05-cv-81, 2006 WL 2501494 (E.D. Tex. July 14, 2006)). To weigh the benefits and costs, courts
`
`3
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`

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`consider three factors: (1) whether the stay will simplify issues before the court, (2) whether the
`
`proceedings have reached an advanced stage, including whether discovery is complete and a trial
`
`date has been set, and (3) whether the stay will unduly prejudice the nonmoving party or present a
`
`clear tactical advantage to the moving party. Commc’n Techs., Inc. v. Samsung Elecs. Am., Inc.,
`
`No. 2:21-CV-00444, 2023 WL 1478447, at *1 (E.D. Tex. Feb. 2, 2023); see NFC Tech., 2015 WL
`
`1069111, at *2. This Court has also considered whether a stay will reduce the burden of litigation
`
`on the parties and on the court. NFC Tech., 2015 WL 1069111, at *2; Stingray Music USA, Inc. v.
`
`Music Choice, No. 2:16-CV-00586, 2017 WL 9885167, at *1 (E.D. Tex. Dec. 12, 2017); CyWee
`
`Grp. Ltd. v. Samsung Elecs. Co., Case No. 2:17-CV-00140, 2019 WL 11023976, at *2–3 (E.D.
`
`Tex. Feb. 14, 2019). A stay is particularly justified when, as here, “the outcome of a PTO
`
`proceeding is likely to assist the court in determining patent validity or eliminate the need to try
`
`infringement issues.” Commc’n Techs., 2023 WL 1478447, at *1 (cleaned up); see also Norman
`
`IP Holdings, 2014 WL 5035718, at *2.
`
`III. Argument: Staying this Case at its Early Stage Will, Without Prejudicing
`NorthStar, Simplify the Issues and Reduce the Burden on the Court
`
`The Court should stay this case, at least on the instituted patents, because all factors favor
`
`a stay. First, a stay will simplify the issues of this litigation because the instituted IPRs cover over
`
`85% of the asserted claims and reduce or potentially eliminate the burden parallel litigation would
`
`otherwise impose on the Court and the parties. CyWee, 2019 WL 11023976, at *3; Uniloc 2017
`
`LLC v. LG Elecs. U.S.A., Inc., No. 3:18-CV-3071, 2020 WL 374545, at *1–2 (N.D. Tex. Jan. 23,
`
`2020). Second, a stay is warranted because this case in its relative infancy—neither party has
`
`served discovery and the “most burdensome” parts of the case are months away. CyWee, 2019 WL
`
`11023976, at *6–7. Third, a stay will not unduly prejudice NorthStar because it created its own
`
`4
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`

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`Case 2:22-cv-00486-JRG Document 87 Filed 01/31/24 Page 8 of 19 PageID #: 1140
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`
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`delay by waiting more than two and a half years after acquiring the Asserted Patents (despite suing
`
`approximately 20 other entities during that time) to file suit.
`
`A.
`
`Factor 1: A stay will simplify the issues before this Court because
`invalidity issues will be disposed of in the IPRs.
`
`This case will unquestionably be simplified by a stay. “The most important factor bearing
`
`on whether to grant a stay in this case is the prospect that the inter partes review proceeding[s]
`
`will result in simplification of issues before the Court.” NFC Tech., 2015 WL 1069111, at *4. As
`
`this Court has recognized, “any disposition by the PTAB is likely to simplify the proceedings
`
`before this Court.” Id. at *7. This Court treats the institution of an IPR as “a highly significant
`
`factor” in determining whether to stay the case because it “ordinarily means that there is a
`
`substantial likelihood of simplification of the district court litigation.” Id. at *4; see also CyWee,
`
`2019 WL 11023976, at *7–10; Commc’n Techs., 2023 WL 1478447, at *2–3.
`
`This Court recognizes that many benefits naturally flow from IPR proceedings to district
`
`court litigation, simplifying the litigation: (i) the PTAB first considering prior art with its expertise,
`
`(ii) alleviating discovery problems related to prior art by the PTAB’s examination, (iii) invalidating
`
`patents, (iv) encouraging settlement without further court involvement, (v) entering the record of
`
`the proceeding at trial and reducing the complexity and length of litigation, (vi) limiting issues,
`
`defenses, and evidence in pre-trial conferences, and (vii) reducing costs for the parties and the
`
`court. NFC Tech., 2015 WL 1069111, at *4; Norman IP Holdings, 2014 WL 5035718, at *3. NFC
`
`Tech. found a “high” likelihood that some or all these benefits will flow from the IPR proceeding
`
`to the litigation. 2015 WL 1069111, at *4
`
`1.
`
`The litigation will be simplified for at least claim construction,
`non-infringement, and invalidity.
`
`In this case, one if not all issues of claim construction, invalidity, and non-infringement
`
`will be simplified because of the IPRs, favoring a stay.
`
`5
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`

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`Case 2:22-cv-00486-JRG Document 87 Filed 01/31/24 Page 9 of 19 PageID #: 1141
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`For claim construction, courts have recognized that the PTAB’s expertise in analyzing
`
`the claims often provides benefit to the district court analyzing the same claims and provides
`
`insight on the proper interpretation of the claims-at-issue. NFC Tech., 2015 WL 1069111, at *4;
`
`Norman IP Holdings, 2014 WL 5035718, at *3. Here, the PTAB has already provided insight on
`
`the proper interpretation of the claims. And, more importantly, NorthStar has been interpreting the
`
`scope of its own claims, which becomes a part of the intrinsic record for the Asserted Patents and
`
`can lead to claim construction estoppel for the asserted claims.
`
`For the ’297, ’527, and ’943 patents, which are all related and currently have instituted
`
`IPRs, NorthStar made arguments in the IPR proceedings on the proper interpretation of the term
`
`“object vector indicator.” Ex. 1 at 11-17 (’297 POPR); Ex. 2 at 11-17 (’527 POPR); Ex. 3 at 12-
`
`18 (’943 POPR); see also Ex. 4 at 20-24 (’297 Institution Decision); Ex. 5 at 25-28 (’527 Institution
`
`Decision); Ex. 6 at 21-22 (’943 Institution Decision). That term will be at issue in the litigation as
`
`well because BMW has proposed the term for construction. Thus, the Board’s insight, and more
`
`importantly, NorthStar’s statements on the appropriate scope of the term will be addressed and
`
`even resolved in the IPR proceeding. Moreover, under Federal Circuit precedent, NorthStar’s IPR
`
`arguments to date and any forthcoming on this or other claim scope issues will serve as a disclaimer
`
`in this proceeding. CUPP Computing AS v. Trend Micro Inc., 53 F.4th 1376, 1383 (Fed. Cir. 2022).
`
`For the ’432 patent, which has an instituted IPR, NorthStar made arguments thus far on
`
`the proper interpretation of the term “wireless communications options,” advocating that proper
`
`interpretation of the term cannot encompass different networks and not simply switching between
`
`cells on the same network based on an express definition in the prosecution history. Ex. 7 at 6
`
`(’432 POPR); Ex. 8 at 12-15 (’432 Institution Decision). Like the prior three patents, this term will
`
`be at issue in the litigation as well because BMW has proposed the term for construction, and the
`
`6
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`

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`Case 2:22-cv-00486-JRG Document 87 Filed 01/31/24 Page 10 of 19 PageID #: 1142
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`Board’s insight and NorthStar’s statements will be addressed and even resolved in the IPR.
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`Moreover, under Federal Circuit precedent, NorthStar’s IPR arguments to date and any
`
`forthcoming on this or other claim scope issues will serve as a disclaimer in this proceeding. CUPP
`
`Computing AS, 53 F.4th at 1383.
`
`For the ’416 patent, although not yet subject to an instituted IPR, NorthStar has nonetheless
`
`made arguments on the proper interpretation of the term “receiving information about a current
`
`location.” Ex. 9 at 3-5 (first ’416 POPR); Ex. 10 at 3-5 (second ’416 POPR). NorthStar, in the IPR
`
`proceeding, advocated that this term should exclude the current location of the mobile
`
`communication device. Id. The Board will likely address the issue in its forthcoming Institution
`
`Decision by March 22, 2024, potentially resolving it, or NorthStar’s argument and any
`
`forthcoming argument on claim interpretation will become part of the intrinsic record impacting
`
`this Court’s interpretation of the claim scope. CUPP Computing AS, 53 F.4th at 1383.
`
`For non-infringement, if one or more claims are invalidated in the IPR proceedings, the
`
`Court need not engage in an infringement analysis, avoiding claim construction, dispositive
`
`motions, and trial on any claims found invalid at the PTAB.
`
`For invalidity, if the claims are invalid, this litigation will be simplified by avoiding the
`
`issue altogether. Even if one or more claims survives IPR, this case will still be simplified. NFC
`
`Tech. recognized that the proceedings would either estop the defendant from challenging the
`
`validity of the claims on any ground that was, or could reasonably have been, asserted (35 U.S.C.
`
`§ 315(e)(2)), or some portion of the litigation would fall away (or come to an end altogether)
`
`because of cancelation of some or all of the asserted claims. 2015 WL 1069111, at *4; Commc’n
`
`Techs., 2023 WL 1478447, at *3–5. Here, four patents are subject to instituted IPRs. And BMW
`
`has stipulated that it will not challenge the validity of the claims of the instituted patents on any
`
`7
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`

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`Case 2:22-cv-00486-JRG Document 87 Filed 01/31/24 Page 11 of 19 PageID #: 1143
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`ground that was, or could reasonably have been, raised in the instituted IPRs. The case will
`
`certainly be simplified for those four patents, at least via either estoppel or cancelation of the
`
`challenged claims.
`
`2.
`
`Even if all claims are not invalidated in the IPRs, this case will
`be simplified.
`
`The simplifying benefits of IPRs on litigation apply even before institution or when only
`
`some of the asserted claims are under review. “[C]ourts in this district have regularly issued stays
`
`in cases in which IPR proceedings have been instituted on fewer than all the claims asserted in the
`
`related litigation.” CyWee, 2019 WL 11023976, at *8. In Uniloc USA Inc. v. Google Inc., the Court
`
`granted a stay where IPRs of two out of four patents-in-suit were instituted, finding that there was
`
`“a significant likelihood that the outcome of the IPR proceedings will streamline the scope and
`
`resolution of these cases.” No. 2:17-cv-231, Dkt. 47 (E.D. Tex. Oct. 3, 2017) (Gilstrap, J.).
`
`Similarly, in Onpoint Systems, LLC v. Protect Animals With Satellites, LLC, the court found that
`
`this factor weighed in favor of granting a stay where the PTAB only instituted review of one of
`
`the four asserted patents because resolution of the one will “generally aid in resolving the parties’
`
`other disputed claims.” No. 4:20-CV-657, 2022 WL 2704166, at *4 (E.D. Tex. July 12, 2022). In
`
`NFC Tech., the “simplification” factor cut “strongly” in favor of granting a stay where the PTAB
`
`instituted review of a subset of claims of the two patents at issue (2015 WL 1069111, at *7) and
`
`Chart Trading Development, LLC v. Tradestation Group, Inc. found the “simplification” factor
`
`weighed in favor of granting a stay pre-institution, finding a stay would “greatly streamline[]” the
`
`issues in the case and not waste “duplicative resources” if institution was granted (Case No. 6:15-
`
`cv-1136, 2016 WL 1246579, at *3–4 (E.D. Tex. Mar. 29, 2016)).
`
`The simplification here is even more certain than in these cases. Here, all claims (both
`
`asserted and unasserted) of four of the five Asserted Patents are currently subject to instituted IPR
`
`8
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`Case 2:22-cv-00486-JRG Document 87 Filed 01/31/24 Page 12 of 19 PageID #: 1144
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`
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`proceedings. More than 85% of the challenged claims are instituted, and the remaining <15% of
`
`the asserted claims are subject to imminent Institution Decisions. Institution on over 85% of claims
`
`is well above the threshold where courts recognize the simplification benefits of a stay. CyWee,
`
`2019 WL 11023976, at *8–10 (finding factor “strongly” cut in favor where more than 45% of
`
`asserted claims were not subject to review between two asserted patents); Onpoint, 2022 WL
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`2704166, at *4 (finding factor weighed in favor where more than 62% of asserted claims were not
`
`subject to review); Uniloc USA Inc., Dkt. 47 (institution on two of four asserted patents).
`
`3.
`
`At the very least, the Court will avoid having to rule on BMW’s
`motion to dismiss.
`
`Regardless of the outcome of the pending IPRs, BMW has a pending motion to dismiss
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`before this Court. Dkt. No. 80. This is a renewed motion to dismiss NorthStar’s Amended
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`Complaint, filed after the Court granted BMW’s motion to dismiss NorthStar’s initial Complaint
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`for failure to state a claim upon which relief could be granted. Dkt. No. 71. Should the Court stay
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`the case pending the outcome of the IPRs, it would not have to rule on BMW’s motion to dismiss
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`NorthStar’s Amended Complaint. Instead, it could either avoid the motion altogether, or rule on a
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`limited subset of issues depending on which claims survive IPR. This would simplify the motion
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`to dismiss issue for the Court, and possibly dispose of it entirely, conserving judicial resources.
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`4.
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`Because of this simplification, the burden on the parties and
`Court will be greatly reduced by a stay.
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`In view of the all-but-certain simplification from the IPR proceedings, a stay will relieve
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`the Court and the parties of having to expend substantial resources on claim construction and
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`noninfringement and invalidity defenses. Versata Software, Inc. v. Callidus Software, Inc., 771
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`F.3d 1368, 1371–72 (Fed. Cir. 2014). Of course, if the IPRs are successful, the Court will be
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`relieved of its burden to decide the issues of claim construction, invalidity, and non-infringement
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`for any claim found invalid at the PTAB. But, even if the IPRs do not invalidate claims of the
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`Case 2:22-cv-00486-JRG Document 87 Filed 01/31/24 Page 13 of 19 PageID #: 1145
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`Asserted Patents, BMW will be subject to estoppel precluding it from asserting invalidity defenses
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`based on prior art raised or that could have been raised in the IPR proceedings. CyWee, 2019 WL
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`11023976, at *3; Uniloc 2017 LLC, 2020 WL 374545, at *1.
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`B.
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`Factor 2: A stay is warranted because this case is in its early stages with
`significant investment yet to occur, and BMW was diligent.
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`1.
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`Significant milestones have yet to occur, favoring a stay to
`conserve judicial and party resources.
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`This case is in its early stages with the most resource-intensive milestones for both the
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`Court and parties still on the horizon—maximizing the benefits of a stay. “Staying a case at an
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`early juncture can advance judicial efficiency and maximize the likelihood that neither the court
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`nor the parties expend their assets addressing invalid claims.” Landmark Tech., LLC v. iRobot
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`Corp., Case No. 6:13-cv-411, 2014 WL 486386, at *3 (E.D. Tex. Jan. 24, 2014) (cleaned up).
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`When considering the progress of the litigation, courts consider the current progress of fact and
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`expert discovery, progress of claim construction, and time until trial, and courts acknowledge that
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`the “primary cost of litigation is incurred pretrial and in a trial on the merits.” Smartflash LLC v.
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`Apple Inc., 621 F. App’x 995, 1004 (Fed. Cir. 2015); NFC Tech., 2015 WL 1069111, at *3;
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`Norman IP Holdings, 2014 WL 5035718, at *3; EchoStar, 2006 WL 2501494, at *4; CyWee, 2019
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`WL 11023976, at *6–7.
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`The court in Norman IP Holdings found this factor weighed in favor of a stay in
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`circumstances similar to this case—where the parties had not engaged in any substantive
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`discovery, the parties’ claim construction positions had not been submitted, a Markman hearing
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`was several months away, and a trial date had been set for over twenty-one months away at the
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`time of filing the motion. 2014 WL 5035718, at *3. And because the Court recognizes that the vast
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`expenditure of both party and judicial resources occurs in the later stages of the case, e.g.,
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`Markman hearing, expert discovery, summary judgment, and trial, when these milestones can be
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`Case 2:22-cv-00486-JRG Document 87 Filed 01/31/24 Page 14 of 19 PageID #: 1146
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`
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`deferred, it weighs in favor of staying the case. CyWee, 2019 WL 11023976, at *6–7 (the “most
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`burdensome parts of the case”—“filing and responding to pretrial motions, preparing for trial,
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`going through the trial process, and engaging in post-trial motions practice”—“all lie in the
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`future”); NFC Tech., 2015 WL 1069111, at *3–4 (the “bulk of expenses that the parties would
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`incur in pretrial work and trial preparation are still in the future”). For example, in EchoStar, where
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`“much” still remained to be done before the case was ready for trial because, as in this case,
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`discovery and claim construction were not complete and summary judgment motions were not
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`filed the court held that it would be an “egregious waste” of the parties’ and court’s resources if
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`the Markman and summary judgment proceedings went forward, and the claims were subsequently
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`declared invalid. 2006 WL 25019494, at *4.
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`Here, the parties have not engaged in substantive discovery (although open, no requests
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`have been served and no depositions have taken place). Claim construction briefing has not begun
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`and the Markman hearing is not scheduled until May. There is nearly five months until the close
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`of fact discovery, six months until the close of expert discovery, and at least nine months until
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`trial. There is no dispute that crucial deadlines have yet to occur, and that a “great deal of activity”
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`remains in this litigation, which unequivocally favors a stay. EchoStar, 2006 WL 25019494, at *4.
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`To find otherwise would be an “egregious waste” of the parties’ and Court’s resources if the May
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`16 Markman hearing, and summary judgment proceedings went forward, and the Board
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`subsequently declared the asserted claims invalid, or even resolved claim construction differently
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`than this Court, creating inconsistent judgments. EchoStar, 2006 WL 25019494, at *4.
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`2.
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`BMW was diligent in filing its petitions and this motion.
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`Under this factor, the Court also considers “whether the defendant acted with reasonable
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`dispatch in filing its petitions for inter partes review and then, after the petitions were granted, in
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`Case 2:22-cv-00486-JRG Document 87 Filed 01/31/24 Page 15 of 19 PageID #: 1147
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`
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`filing its motion for a stay.” NFC Tech., 2015 WL 1069111, at *3; Commc’n Techs., 2023 WL
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`1478447, at *3. BMW was diligent both in filing its petitions and in seeking a stay.
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`BMW filed its first IPR less than five months and its last IPRs less than eight months from
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`NorthStar bringing suit—all before NorthStar filed its Amended Complaint on September 19.
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`Dkt. No. 74. BMW has now filed this motion, merely twelve days after the IPR on the fourth
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`challenged and Asserted Patent was instituted and before two expected institution dates. Until four
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`patents were subject to instituted IPRs, a stay would potentially have been premature. Thus, BMW
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`acted with “reasonable dispatch” to file its motion to stay at a time when the factors clearly favored
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`a stay to avoid bringing premature motions before the Court.
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`C.
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`Factor 3: A stay will not unduly prejudice NorthStar because it is a
`non-practicing entity that waited more than two years to bring suit.
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`This factor favors a stay because a stay will not unduly prejudice NorthStar, which makes
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`no competing products and delayed in filing suit, nor provide a clear tactical advantage to BMW.
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`1.
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`NorthStar will face no undue prejudice.
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`A delay in enforcing patent rights is “present in every case in which a patentee resists a
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`stay, and it is therefore not sufficient, standing alone, to defeat a stay motion.” Commc’n Techs.,
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`2023 WL 1478447, at *2; NFC Tech., 2015 WL 1069111, at *2. Where delay is the only potential
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`prejudice the non-moving party may face, this factor weighs in favor of granting a stay. Parallel
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`Networks Licensing, LLC v. Ramquest Software, Inc., No. 4:19-cv-487, 2020 WL 1236266, at *1
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`(E.D. Tex. Mar. 13, 2020). And a “blanket statement that evidence may become stale or be lost
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`does not amount to a compelling showing of prejudice.” NFC Tech., 2015 WL 1069111, at *3.
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`Moreover, the “mere delay in collecting [monetary] damages does not constitute undue
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`prejudice”—it only delays realization of those damages. Stragent LLC v. BMW of N. Am., LLC,
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`No. 6:16-CV-446, 2017 WL 3709083, at *2 (E.D. Tex. July 11, 2017) (cleaned up). And where
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`Case 2:22-cv-00486-JRG Document 87 Filed 01/31/24 Page 16 of 19 PageID #: 1148
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`
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`the non-moving party does not move for a preliminary injunction, while not dispositive, this further
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`negates its claim of undue prejudice. Stingray Music USA, 2017 WL 9885167, at *2.
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`NorthStar faces no undue prejudice for at least five reasons. First, a delay in enforcing
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`paten