Case 5:19-cv-00036-RWS Document 485 Filed 08/05/20 Page 1 of 20 PageID #: 26451
`
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`TEXARKANA DIVISION
`
`MAXELL, LTD.,
`
`Plaintiff,
`
`
`
`
`
`
`
`vs.
`
`APPLE INC.,
`
`
`
`
`
`Defendant.
`
` Civil Action No. 5:19-cv-00036-RWS
`
`
`
`
`JURY TRIAL DEMANDED
`
`
`APPLE INC.’S RENEWED MOTION TO STAY PENDING DETERMINATION OF
`INTER PARTES REVIEW OF THE PATENTS-IN-SUIT
`
`
`
`
`
`
`
`

`

`Case 5:19-cv-00036-RWS Document 485 Filed 08/05/20 Page 2 of 20 PageID #: 26452
`
`TABLE OF CONTENTS
`
`
`Page
`INTRODUCTION ............................................................................................................. 1
`FACTUAL BACKGROUND ............................................................................................ 2
`ARGUMENT ..................................................................................................................... 4
`A.
`The Four Instituted IPR Proceedings Warrant A Stay Now Because They
`Will Simplify The Case ......................................................................................... 4
`The Three Relevant Factors Collectively Favor A Stay ........................................ 5
`1.
`The IPRs Have Already Simplified This Case, And They Will
`Continue To Do So .................................................................................... 5
`The Current Stage of This Case Favors A Stay ......................................... 9
`2.
`Maxell Will Not Be Unduly Prejudiced By A Stay ................................. 12
`3.
`CONCLUSION ................................................................................................................ 14
`
`B.
`
`I.
`II.
`III.
`
`IV.
`
`
`
`
`i
`
`

`

`Case 5:19-cv-00036-RWS Document 485 Filed 08/05/20 Page 3 of 20 PageID #: 26453
`
`TABLE OF AUTHORITIES
`
`
`Page(s)
`
`Cases
`
`ActiveVideo Networks, Inc. v. Verizon Commc’ns, Inc.,
`694 F.3d 1312 (Fed. Cir. 2012) ................................................................................................ 13
`Apple Inc. v. Maxell, Ltd.,
`IPR2020-00201, Paper No. 12 (PTAB July 6, 2020) ................................................................. 3
`Apple Inc. v. Samsung Elecs. Co., Ltd.,
`735 F.3d 1352 (Fed. Cir. 2013) ................................................................................................ 13
`Ericsson Inc. v. TCL Commc’n Tech. Holdings, Ltd.,
`No. 2:15-cv-00011-RSP, 2016 WL 1162162 (E.D. Tex. Mar. 23, 2016) ................................ 10
`E-Watch, Inc. v. Lorex Canada, Inc.,
`No. CIV.A. H-12-3314, 2013 WL 5425298 (S.D. Tex. Sept. 26, 2013) .................................. 13
`Fresenius USA, Inc. v. Baxter Int’l, Inc.,
`721 F.3d 1330 (Fed. Cir. 2013) .................................................................................................. 5
`Image Processing Techs., LLC v. Samsung Electronics Co., Ltd.,
`No. 2:16-cv-505-JRG, Dkt. No. 306 (E.D. Tex. Oct. 25, 2017) ....................................... 4, 9, 10
`Murata Mach. USA v. Daifuku Co.,
`830 F.3d 1357 (Fed. Cir. 2016) .................................................................................................. 7
`NFC Tech. LLC v. HTC Am., Inc.,
`No. 2:13-cv-1058-WCB, 2015 WL 1069111 (E.D. Tex. March 11, 2015) ....................... passim
`Parallel Networks Licensing, LLC v. Ramquest Software, Inc.,
`No. 4:19-cv-487, 2020 WL 1236266 (E.D. Tex. Mar. 13, 2020) ............................................. 13
`Realtime Data LLC v. Actian Corp.,
`No. 6:15-cv-463-RWS-JDL, 2016 WL 3277259 (E.D. Tex. June 14, 2016) ........................... 14
`Robert Bosch LLC v. Pylon Mfg. Corp.,
`No. 08-542-SLR, 2009 WL 2742750 (D. Del. Aug. 26, 2009) .................................................. 7
`Smartflash LLC v. Apple Inc.,
`621 F. App’x 995 (Fed. Cir. 2015) ..................................................................................... 10, 11
`Software Rights Archive, LLC v. Facebook, Inc.,
`No. C-12–3970 RMW, 2013 WL 5225522 (N.D. Cal. Sept. 17, 2013) ................................... 11
`SSL Servs., LLC v. Cisco Sys., Inc.,
`No. 2:15-cv-433-JRG-RSP, 2016 WL 3523871 (E.D. Tex. June 28, 2016) ........................ 4, 10
`
`ii
`
`

`

`Case 5:19-cv-00036-RWS Document 485 Filed 08/05/20 Page 4 of 20 PageID #: 26454
`
`TABLE OF AUTHORITIES
`(continued)
`
`Page(s)
`
`Tinnus Enters., LLC v. Telebrands Corp.,
`No. 6:15-cv-551-RC-JDL, 2017 WL 379471 (E.D. Tex. Jan. 24, 2017) ................................. 10
`VirtualAgility Inc. v. Salesforce.com, Inc.,
`759 F.3d 1307 (Fed. Cir. 2014) ............................................................................................ 9, 10
`Visual Interactive Phone Concepts, Inc. v. Samsung Telecomm. Am., LLC,
`No. 11-12945, 2012 WL 1049197 (E.D. Mich. Mar. 28, 2012) ............................................... 13
`Statutes
`
`35 U.S.C. § 315(e)(2) ...................................................................................................................... 8
`35 U.S.C. § 318(c) .......................................................................................................................... 8
`Regulations
`
`77 Fed. Reg. at 48,680-01 (2012) ................................................................................................. 14
`
`
`iii
`
`

`

`Case 5:19-cv-00036-RWS Document 485 Filed 08/05/20 Page 5 of 20 PageID #: 26455
`
`
`I.
`
`INTRODUCTION
`
`The Patent Trial and Appeal Board (“PTAB”) has now instituted review for four of the
`
`10 petitions for inter partes review (“IPR”) that Apple filed. The PTAB has denied two
`
`petitions, and Apple expects decisions on three more by August 12 and on the tenth and final one
`
`by September 25. In view of the fact that the IPRs, including those that were not instituted, have
`
`already demonstrably simplified this case and will continue to do so, Apple respectfully moves
`
`the Court to stay this litigation at least until the PTAB issues final written decisions in the
`
`pending IPRs involving the Patents-in-Suit.
`
`Proceeding with this litigation while several IPRs continue in parallel could risk the
`
`finality of judgments rendered in this case and could prove extraordinarily wasteful of both the
`
`Court’s and the parties’ resources. And because a stay will simplify the litigation, including by
`
`resolving all issues related to the challenged claims if they are held invalid or by estopping Apple
`
`from presenting certain invalidity defenses if the Federal Circuit affirms the patentability of
`
`those claims; because costly and time-consuming pre-trial and trial activities have not yet
`
`occurred; and because Maxell will not be unduly prejudiced by the requested stay, the Court
`
`should grant this motion and stay this case.
`
`It is counterproductive to try patent claims that the PTAB will likely invalidate: the
`
`PTAB cancels at least some challenged claims 80% of the time, and cancels all challenged
`
`claims 62% of the time. Ex. A at 11.1 Apple’s success rate in the PTAB is even better. For IPR
`
`petitions of Apple’s that reached final decision, the PTAB cancelled or amended claims in 90%
`
`of them (191/215 decisions), and cancelled all challenged claims nearly 75% of the time
`
`(157/215 decisions). Id., Ex. B at 1.
`
`
`1 All Exhibits are to the accompanying Declaration of Luann Simmons (“Simmons Decl.”).
`
`1
`
`

`

`Case 5:19-cv-00036-RWS Document 485 Filed 08/05/20 Page 6 of 20 PageID #: 26456
`
`
`The factors governing whether a stay is appropriate here weigh heavily in favor of
`
`staying this litigation pending the resolution of the IPRs: (1) there can be no dispute that the IPRs
`
`will continue to simplify the issues of any trial as four IPRs have already been instituted and
`
`there is a high likelihood that those proceedings will result in at least some claims being
`
`invalidated and there is a likelihood that the PTAB institutes IPR in the remaining four
`
`proceedings; (2) especially in view of the current breadth and complexity of this case, the most
`
`burdensome work in this case—the trial—is outstanding; and (3) Maxell cannot show that it will
`
`be prejudiced, much less unduly prejudiced, by a stay. Staying this case pending IPR will
`
`conserve judicial, party, and third-party resources; avoid piecemeal, duplicative litigation; and
`
`greatly simplify any issues that could remain for trial.
`
`II.
`
`FACTUAL BACKGROUND
`
`Maxell alleges that Hitachi, Maxell’s predecessor-in-interest in the Patents-in-Suit, began
`
`talks with Apple about its patents at least as far back as June 2013. See D. I. 111, ¶ 5. And of
`
`the hundreds of Apple products accused in this case, Apple first sold some of them in 2012. See
`
`id., ¶¶ 26, 40, 55, 68, 85, 98, 111, 128, 141, 156. Yet, neither Hitachi nor Maxell sued Apple
`
`until March 2019. D.I. 1. Indeed, what Maxell has alleged is Apple’s prolific infringement
`
`apparently caused neither Hitachi nor Maxell any concern at all until 2018, when Maxell awoke
`
`from three years of silence with its current litigation counsel writing Apple to announce that a
`
`suit was imminent. See D. I. 111, ¶ 5. And the patents it has now asserted here are hardly crown
`
`jewels: five have already expired, another will expire next month, and the PTAB has already
`
`found that four of them are reasonably likely to be invalid. Simmons Decl., ¶¶ 14, 21-22, 25-26.
`
`Consistent with a spaghetti-on-the-wall approach, Maxell asserted a total of 90 claims
`
`across 10 patents against Apple in June 2019. Id., ¶ 15. Maxell reduced that number to 40 on
`
`November 6, 2019, and finally to 20 on March 17, 2020. Id., ¶¶ 18, 20.
`
`2
`
`

`

`Case 5:19-cv-00036-RWS Document 485 Filed 08/05/20 Page 7 of 20 PageID #: 26457
`
`
`Within about six months of Maxell identifying its 90 asserted claims and just over a
`
`month after Maxell elected 40 claims, Apple filed six IPR petitions challenging 51 claims,
`
`including all asserted claims, for six of the 10 Patents-in-Suit. Id., ¶¶ 15, 18, 21-26. Less than a
`
`month later, Apple filed three more IPR petitions, such that by January 2020, Apple had filed
`
`petitions challenging 79 claims, including all asserted claims, of nine of the 10 Patents-in-Suit.
`
`Id., ¶¶ 27-30. Two months later, Apple filed its last IPR petition challenging seven claims,
`
`including all asserted claims for the sole remaining Patent-in-Suit. Id., ¶ 31. The PTAB has now
`
`granted four of these petitions, covering four of the 10 Patents-in-Suit, and denied two petitions.2
`
`See id., ¶¶ 21-26. Institution decisions for the three related “walking navigation patents” (the
`
`’317, ’498, and ’999 Patents) are due by August 12, 2020, and for the ’493 Patent by September
`
`25, 2020. See id., ¶¶ 27-31.
`
`The dispositive and Daubert motions hearing is scheduled for September 15, 2020, and a
`
`jury trial is set to begin on October 26, 2020. D.I. 283. In the interim, the parties must complete
`
`all briefing for and argue dipositive motions, Daubert motions, and motions to strike; exchange
`
`all pretrial disclosures and deposition designations; prepare the joint final pre-trial order; brief
`
`and argue motions in limine; and prepare for and participate in the pre-trial conference. Id.
`
`Apple promptly moved to stay this case more than four months ago, on March 24, 2020,
`
`pending the outcome of its pending IPR petitions. D.I. 239. The Court denied Apple’s motion in
`
`April, but did so without prejudice because the PTAB had not yet issued any institution
`
`decisions. D.I. 298. The more-developed IPR record now confirms that a stay is warranted.
`
`
`2 Apple filed a request for rehearing of the PTAB’s denial of the IPR petition for one of the two
`denials (the decision regarding the IPR challenging the ’438 Patent) because the PTAB
`overlooked one of Apple’s arguments. See Apple Inc. v. Maxell, Ltd., IPR2020-00201, Paper
`No. 12 (PTAB July 6, 2020).
`
`3
`
`

`

`Case 5:19-cv-00036-RWS Document 485 Filed 08/05/20 Page 8 of 20 PageID #: 26458
`
`
`III. ARGUMENT
`
`“A stay is particularly justified when ‘the outcome of a PTO proceeding is likely to assist
`
`the court in determining patent validity or eliminate the need to try infringement issues.’” SSL
`
`Servs., LLC v. Cisco Sys., Inc., No. 2:15-cv-433-JRG-RSP, 2016 WL 3523871, at *1 (E.D. Tex.
`
`June 28, 2016) (quoting NFC Tech. LLC v. HTC Am., Inc., No. 2:13-cv-1058-WCB, 2015 WL
`
`1069111, at *2 (E.D. Tex. March 11, 2015) (Bryson, J.) (citing cases)). In this district, “courts
`
`typically consider three factors when determining whether to grant a stay pending inter partes
`
`review of a patent in suit: (1) whether the stay will unduly prejudice the nonmoving party,
`
`(2) whether the proceedings before the court have reached an advanced stage, including whether
`
`discovery is complete and a trial date has been set, and (3) whether the stay will likely result in
`
`simplifying the case before the court.” NFC Tech., 2015 WL 1069111, at *2. However, “the
`
`most important factor bearing on whether to grant a stay … is the prospect that the inter partes
`
`review proceeding will result in simplification of issues before the Court.” Id. at *4; see also
`
`Image Processing Techs., LLC v. Samsung Electronics Co., Ltd., No. 2:16-cv-505-JRG, Dkt. No.
`
`306 at 1-3 (E.D. Tex. Oct. 25, 2017) (staying case pending IPRs covering three of four patents-
`
`in-suit a week after the Pretrial Conference and three weeks before trial and noting that
`
`“[p]otential costs, delay, or prejudice resulting from postponing the resolution of the case are
`
`outweighed by the benefits of a stay”). Here, that prospect is high and the three factors strongly
`
`favor a stay.
`
`A.
`
`The Four Instituted IPR Proceedings Warrant A Stay Now Because They
`Will Simplify The Case
`
`When it denied Apple’s initial motion to stay, the Court recognized that the then-pending
`
`institution decisions on Apple’s IPRs might sufficiently simplify the issues for trial to warrant a
`
`stay. D.I. 298 at 6. And that is exactly what has happened. The PTAB’s four institution
`
`4
`
`

`

`Case 5:19-cv-00036-RWS Document 485 Filed 08/05/20 Page 9 of 20 PageID #: 26459
`
`
`decisions signal a significant simplification of the issues and support staying the case to avoid
`
`proceeding to trial on likely invalid claims. See id. (noting that “the potential simplification of
`
`issues following institution decisions” might “outweigh” the remaining factors). When Apple
`
`first moved to stay, the PTAB had not yet instituted any of Apple’s IPR petitions. Now, the
`
`PTAB has decided to review 40% of the claims (and the same percent of patents) Maxell has
`
`elected for trial, with decisions on 25% more due by August 12, 2020, and the remaining
`
`decision due by September 25, 2020. Because cancelling a patent claim in the PTO has a
`
`binding effect on pending district court litigation, a stay will prevent further waste, prevent
`
`manifest injustice, and avoid contradictory results. See Fresenius USA, Inc. v. Baxter Int’l, Inc.,
`
`721 F.3d 1330, 1340 (Fed. Cir. 2013) (“[W]hen a claim is cancelled, the patentee loses any cause
`
`of action based on that claim, and any pending litigation in which the claims are asserted
`
`becomes moot.”).
`
`As explained below, in view of the PTAB’s institution decisions, the stay factors weigh
`
`overwhelmingly in favor of staying the case at least until the PTAB issues final written decisions
`
`in the pending IPRs involving the Patents-in-Suit.
`
`B.
`
`The Three Relevant Factors Collectively Favor A Stay
`1.
`
`The IPRs Have Already Simplified This Case, And They Will
`Continue To Do So
`
`Apple’s IPRs have already meaningfully simplified this case, and they will continue to do
`
`so. Indeed, the PTAB is now reviewing 40% of the claims remaining in this case (and is highly
`
`likely to invalidate them) and another 35% are at risk.3 Thus, the “most important factor” in the
`
`
`3 The PTAB’s institution rate for the IPRs for the Patents-in-Suit is consistent with Apple’s
`overall statistics—of all IPR petitions filed by Apple that reached the institution stage, 73% (330
`out of 455 petitions) were granted for review. Simmons Decl., Ex. B at 1. Similarly, among all
`petitions filed by Apple’s IPR counsel that reached the institution stage, 76% (104 out of 137
`
`5
`
`

`

`Case 5:19-cv-00036-RWS Document 485 Filed 08/05/20 Page 10 of 20 PageID #: 26460
`
`
`Court’s stay analysis—case simplification—now weighs heavily in favor of a stay. See NFC
`
`Tech., 2015 WL 1069111, at *4.
`
`In fact, Apple’s IPRs, including the non-instituted IPR proceedings, have already
`
`meaningfully simplified this case. For example, in its Patent Owner Preliminary Response
`
`regarding the ’193 Patent IPR petition, on which the PTAB denied institution, Maxell argued that
`
`Apple failed to show that the prior art discloses the claimed “receiver.” But, as Apple’s expert
`
`explained in this case, such an interpretation cannot be correct because it would render the claim
`
`invalid for lack of written description. See D.I. 356 at 1-5; D.I. 444 at 2-3. To avoid this,
`
`Maxell’s expert conceded that the recited “receiver” element was disclosed in the prior art cited
`
`during prosecution, and that a POSITA would have known “how ‘a receiver … for outputting a
`
`power control signal derived from said transmitting power control signal sent from said cell-site
`
`station’ and related closed loop power control steps could be implemented.” Simmons Decl., Ex.
`
`D (Vojcic Rebuttal Report) at ¶ 98. Thus, even Maxell’s pre-institution statements, including
`
`those made in this non-instituted IPR proceeding, simplified issues by eliminating any dispute of
`
`whether the recited “receiver” was known in the art. Similarly, Maxell’s forthcoming arguments
`
`in the IPR proceedings will inevitably further simplify and eliminate issues for this case,
`
`including those made in, for example, Maxell’s Patent Owner Responses and oral arguments.
`
`Thus, Apple’s IPRs have already meaningfully simplified this case, and they will, without a
`
`doubt, continue to do so.
`
`Indeed, as the PTAB has already found that 40% of the elected claims of the Patents-in-
`
`Suit are reasonably likely to be invalid—in some cases on multiple independent grounds—there
`
`
`petitions) were granted. Id., Ex. C at 1. Indeed, the PTAB instituted Apple’s IPR for the ’794
`Patent, despite denying a previous petition filed by another party regarding that patent.
`
`6
`
`

`

`Case 5:19-cv-00036-RWS Document 485 Filed 08/05/20 Page 11 of 20 PageID #: 26461
`
`
`is now no question that a stay will allow the PTAB to simplify this case. Based on the PTAB’s
`
`own statistics, the odds that the PTAB will invalidate at least some of the elected claims across
`
`the four pending IPRs are better than 80%. See Ex. A at 11. And in each decision granting
`
`institution, the PTAB praised the strength of Apple’s petition over Maxell’s arguments about the
`
`substantive and procedural merits. See, e.g., Simmons Decl. Ex. E (’306 Institution Decision) at
`
`18 (noting “the particularly strong merits” of Apple’s petition”), Ex. F (’794 Institution
`
`Decision) at 21 (noting “the particularly strong merits” of Apple’s petition), Ex. G (’991
`
`Institution Decision) at 25 (finding Apple’s petition was “particular[ly] str[ong]”), Ex. H (’586
`
`Institution Decision) at 20 (finding Apple’s challenge “strong.”).
`
`Given that the PTAB has already acknowledged the strength of Apple’s IPR challenges, a
`
`stay here will likely result in the PTAB cancelling at least eight of the 20 elected claims,
`
`eliminating four of the 10 Patents-in-Suit, and substantially narrowing the issues for trial. This
`
`narrowing would reduce the burden on the Court, the parties, and the jury because preparing for
`
`trial is not a minimal task and “the burden imposed on a jury in a patent trial is extraordinary.”
`
`Robert Bosch LLC v. Pylon Mfg. Corp., No. 08-542-SLR, 2009 WL 2742750, at *1 (D. Del.
`
`Aug. 26, 2009); see also Murata Mach. USA v. Daifuku Co., 830 F.3d 1357, 1362 (Fed. Cir.
`
`2016) (“The burden litigation places on the court and the parties when IPR proceedings loom is
`
`one such consideration that district courts may rightfully choose to weigh.”) (citing NFC Tech.,
`
`2015 WL 1069111, at *5). If the Court denies a stay, the extensive resources expended to
`
`prepare this case for trial, try it, and file extensive post-trial briefing, regardless of the verdict,
`
`will have all been for naught for those claims invalidated by the PTAB.
`
`Even in the unlikely event that the PTAB confirms the patentability of certain claims, and
`
`the Federal Circuit affirms that decision, estoppel will prevent Apple from arguing here that such
`
`7
`
`

`

`Case 5:19-cv-00036-RWS Document 485 Filed 08/05/20 Page 12 of 20 PageID #: 26462
`
`
`claims (if any) are invalid on any ground that Apple “raised or reasonably could have raised”
`
`during the IPRs. See 35 U.S.C. § 315(e)(2). So even if some of the claims survive, IPR will still
`
`significantly simplify the case because Apple may be estopped from presenting up to seven of its
`
`19 elected prior art grounds, and possibly more if the remaining petitions are instituted.
`
`On the other hand, trying claims that may be cancelled or amended during the IPRs
`
`would be a waste of judicial resources. For example, if Maxell amends its claims, Apple cannot
`
`be held liable for any alleged infringement of the original, pre-amendment claims. 35 U.S.C. §
`
`318(c). Absent a stay, the jury will have considered claims that no longer exist and for which
`
`Apple cannot be held liable, thus necessitating another trial on the same patents but with the new
`
`claims. Reevaluation of damages issues may also be necessary as cancelling patents within
`
`Maxell’s patent portfolio may diminish the import of Maxell’s licenses. Trying claims that are
`
`reasonably likely to be cancelled will, thus, not only be a waste of time and resources in and of
`
`itself, but will likely force a second trial, thereby doubling the time and resources needed to
`
`resolve the disputes between these parties.
`
`A stay would especially benefit this bloated case. The parties have collectively identified
`
`22 “will call” witnesses, including 18 expert witnesses, and 44 “may call” witnesses to testify
`
`regarding the 10 Patents-in-Suit that are asserted against a wide range of different technologies
`
`and hundreds of accused products. See Simmons Decl. at Exs. I-L. Even if the IPRs ultimately
`
`invalidated just one patent, this trial would be materially simpler—and, based on the record, the
`
`PTAB will in fact likely invalidate at least four of the remaining patents in this case.
`
`The fact that the PTAB denied institution for IPR of two of the 10 Patents-in-Suit does
`
`not outweigh the benefits of a stay. In Image Processing Techs., LLC v. Samsung Electronics
`
`Co., Ltd., the Court found that, even with one of four asserted patents not being in IPR, the
`
`8
`
`

`

`Case 5:19-cv-00036-RWS Document 485 Filed 08/05/20 Page 13 of 20 PageID #: 26463
`
`
`“benefits of a stay outweigh the costs of delaying trial,” because a “stay has the potential to
`
`decrease the burdens on the Court and the parties,” where, since three patents-in-suit were in
`
`IPR, “there is a material possibility that the outcome of all IPR proceedings will streamline the
`
`scope and resolution of this case.” Case No. 2:16-cv-505-JRG, Dkt. No. 306 at 2-3 (E.D. Tex.
`
`Oct. 25, 2017) (staying the case after the Final Pretrial Conference, three weeks before trial).
`
`Similarly here, the outcome of the already-instituted IPR proceedings for four Patents-in-Suit
`
`will undoubtedly “streamline the scope and resolution of this case.” See id. With discovery
`
`over, the parties can efficiently conduct a trial for any patents the PTAB doesn’t review—and
`
`any other patents that survive—when the IPRs are over. This would impose a materially lesser
`
`burden on the Court and the jury, and be far less costly for the parties, than a 10-patent trial.
`
`In summary, a stay pending IPR would let the PTAB significantly simplify the issues
`
`remaining for trial under any outcome of the proceedings, whether the claims are affirmed or
`
`cancelled. Therefore, this factor weighs heavily in favor of a stay.
`
`2.
`
`The Current Stage of This Case Favors A Stay
`
`The stage of the proceedings also favors a stay because while much work has been done,
`
`the most burdensome work—the trial—remains. “Generally, the time of the motion is the
`
`relevant time to measure the stage of litigation.” VirtualAgility Inc. v. Salesforce.com, Inc., 759
`
`F.3d 1307, 1316-17 (Fed. Cir. 2014). At the time Apple initially moved for a stay (on March 24,
`
`2020), fact discovery was still open and at least 17 fact depositions remained, expert discovery
`
`had not yet started, and the parties had not yet filed any case dispositive motions. See D.I. 239 at
`
`4-5. That motion was denied without prejudice because the PTAB had not yet issued any
`
`institution decisions (see D.I. 298); now that the PTAB has instituted review of nearly half of the
`
`elected claims, Apple renews its motion. As this Court noted before, another court in this
`
`district, recognizing the likelihood that the IPRs would significantly simply the issues that would
`
`9
`
`

`

`Case 5:19-cv-00036-RWS Document 485 Filed 08/05/20 Page 14 of 20 PageID #: 26464
`
`
`have to be tried, stayed a case that had progressed even further than this one—the Final Pretrial
`
`Conference was complete and trial was only three weeks away—with only three of four patents-
`
`in-suit in IPR. See Image Processing Techs., No. 2:16-cv-505-JRG, Dkt. No. 306 at 1-3 (E.D.
`
`Tex. Oct. 25, 2017).
`
`Although the stay factors should be evaluated at the time of Apple’s initial motion, there
`
`is “no error in also taking into account the stage of the litigation as of the date that [IPR] was
`
`granted.” VirtualAgility, 759 F.3d at 1316-17. For example, in Smartflash LLC v. Apple Inc.,
`
`621 F. App’x 995, 1005 (Fed. Cir. 2015), the Federal Circuit held that the district court should
`
`have stayed an upcoming trial notwithstanding “the substantial time and effort already spent.”
`
`Id. The Federal Circuit recognized that, even with trial “mere months away,” the “most
`
`burdensome task [was] yet to come.” Id. at 1005-06. This case is no different. The trial—the
`
`“most burdensome task”—won’t begin for three months. And the PTAB is already reviewing
`
`40% of the claims set to be tried and that number will likely increase before trial starts. The
`
`expected material simplification that will result from the PTAB’s reviews heavily outweighs any
`
`argument for proceeding to trial now. See Ericsson Inc. v. TCL Commc’n Tech. Holdings, Ltd.,
`
`No. 2:15-cv-00011-RSP, 2016 WL 1162162, at *2-3 (E.D. Tex. Mar. 23, 2016) (granting stay
`
`“amid final trial preparation and within two months of the trial date”); SSL Servs., 2016 WL
`
`3523871, at *1-3 (granting stay despite “advanced stage of th[e] case”); Tinnus Enters., LLC v.
`
`Telebrands Corp., No. 6:15-cv-551-RC-JDL, 2017 WL 379471, at *2 (E.D. Tex. Jan. 24, 2017)
`
`(granting stay just months before trial).
`
`Trial is not the only burdensome task still to be completed. The parties have filed 18
`
`dispositive motions, Daubert motions, and motions to strike raising issues relating to all 10
`
`Patents-in-Suit, damages, and the 35 expert reports submitted in this case. And in the coming
`
`10
`
`

`

`Case 5:19-cv-00036-RWS Document 485 Filed 08/05/20 Page 15 of 20 PageID #: 26465
`
`
`weeks, the parties will be filing motions in limine and other pre-trial filings, all of which will
`
`require significant amounts of time for the Court to resolve—efforts that may prove to have been
`
`wasted because of the high likelihood that the PTAB’s written decisions will moot many of the
`
`disputes. See Smartflash, 621 F. App’x at 1005.
`
`Apple’s diligence in filing the IPRs also favors granting the stay. See Software Rights
`
`Archive, LLC v. Facebook, Inc., No. C-12–3970 RMW, 2013 WL 5225522, at *6 (N.D. Cal.
`
`Sept. 17, 2013) (staying case where IPRs were filed four months after plaintiff identified asserted
`
`claims). In June 2019, three months after Maxell filed this case, Maxell identified 90 asserted
`
`claims from 10 Patents-in-Suit. The parties and the Court agreed in the Court’s Focusing Order
`
`that 90 claims, particularly given the wide range of technologies reflected in those claims,
`
`created far too broad of a scope for this case and both parties would need to narrow it by
`
`reducing asserted claims and prior art. See Simmons Decl., ¶ 16. Apple, nonetheless, promptly
`
`began searching for and evaluating prior art for all 90, and, within seven months, finished
`
`searching for and analyzing thousands of prior art references for each of the 90 claims at issue;
`
`prepared invalidity contentions, including 63 claim charts mapping prior art to asserted claims;
`
`coordinated with technical experts; and drafted and filed nine IPR petitions. See id., ¶ 17.
`
`Indeed, Apple’s IPRs challenge 86 of the 90 claims initially asserted by Maxell, though Maxell’s
`
`November 2019 narrowing dropped claims that recited several unique limitations, allowing
`
`Apple to narrow its search and analysis to only those claims still at issue. See id., ¶¶ 18-19.
`
`Thus, Apple filed all of the currently-instituted IPRs by December 20, 2019, only six months
`
`after Maxell identified its asserted claims. See id., ¶¶ 15, 21-26.
`
`Apple’s final petition, filed March 17, 2020, involved unique third-party discovery issues
`
`that required additional time to resolve. Id., ¶¶ 31-32. Specifically, Apple’s IPR petition on the
`
`11
`
`

`

`Case 5:19-cv-00036-RWS Document 485 Filed 08/05/20 Page 16 of 20 PageID #: 26466
`
`
`’493 Patent included grounds based on Casio prior art, which Apple only discovered around
`
`October 25, 2019, as outlined in Apple’s Motion for Leave to Supplement its Invalidity
`
`Contentions. See D.I. 130. As explained there, in less than five months, Apple discovered and
`
`charted the Casio prior art, petitioned the Court for leave to supplement its invalidity contentions,
`
`requested third-party discovery from Casio, and drafted and filed its IPR petition based on that
`
`art. See id. Granting Apple’s motion, the Court found that Apple exercised diligence with
`
`respect to this art. D.I. 201 at 3-5. The same conclusion is true for Apple’s IPR petition.
`
`In view of the necessity and complexity of third-party discovery, not to mention the
`
`complexity of the case and the number of patents and claims asserted, Apple’s filing all but one
`
`of its petitions in less than five months after Maxell identified its 40 asserted claims
`
`demonstrates that Apple was diligent in preparing and filing its IPR petitions.
`
`3.
`
`Maxell Will Not Be Unduly Prejudiced By A Stay
`
`Maxell cannot show that it would suffer any colorable prejudice from a stay, much less
`
`any undue prejudice.
`
`First, money damages will fully compensate Maxell for any alleged harm. NFC Tech.,
`
`2015 WL 1069111, at *2-3 (finding no prejudice because “monetary relief will be sufficient” for
`
`a non-competitor). Maxell is essentially a patent assertion and licensing entity that seeks only to
`
`license the asserted patents. See, e.g., D.I. 111, ¶¶ 1-3. Maxell has also conceded that it does not
`
`use any of the Patents-in-Suit (see, e.g., D.I. 66 at 22), so it is does not compete with Apple in
`
`the markets for any of the accused products or technologies. That Maxell may desire an
`
`injunction in this case does not change the conclusion that money damages would fully
`
`compensate Maxell. Indeed, the Court already found that the fact that Maxell never sought a
`
`preliminary injunction “contradicts” Maxell’s assertion that delayed injunctive relief would
`
`cause it undue prejudice. D.I. 298 at 3. Six of the 10 Patents-in-Suit will be expired by trial;
`
`12
`
`

`

`Case 5:19-cv-00036-RWS Document 485 Filed 08/05/20 Page 17 of 20 PageID #: 26467
`
`
`thus, injunctions are not even available for these patents. And Maxell’s status as a company that
`
`freely licenses its patents and does not compete with Apple means that it could never obtain the
`
`injunctive relief it wishes for anyway. See, e.g., ActiveVideo Networks, Inc. v. Verizon
`
`Commc’ns, Inc., 694 F.3d 1312, 1338 (Fed. Cir. 2012) (finding that