Case 5:19-cv-00036-RWS Document 662 Filed 03/15/21 Page 1 of 11 PageID #: 33221
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`TEXARKANA DIVISION
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`Plaintiff,
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`Defendant.
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`CIVIL ACTION NO. 5:19-CV-00036-RWS
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`MAXELL LTD.,
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`v.
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`APPLE INC,
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`§
`§
`§
`§
`§
`§
`§
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`§
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`ORDER
`Before the Court is Apple’s Motion to Stay Pending Proceedings at the Patent Office or, in
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`the Alternative, to Continue Trial Due to the COVID-19 Pandemic (Docket No. 629). For the
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`reasons set forth below, Apple’s motion to stay is DENIED WITHOUT PREJUDICE and
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`Apple’s motion to continue in the alternative is DENIED.
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`BACKGROUND
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`Maxell filed its initial complaint on March 15, 2019, alleging that Apple’s products infringe
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`ten patents.1 Docket No. 11. Jury selection and trial were set to begin on December 7, 2020, but
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`trial was reset for March 22, 2021. Docket No. 593. In response to the parties’ negotiations and
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`the Court’s order, Maxell narrowed its asserted claims to six patents: the ’317, ’999, ’498, ’493,
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`’794 and ’438 patents. See Docket Nos. 624, 628.
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`Of the six asserted patents, only the ’794 patent is subject to IPR proceedings. Docket No.
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`629 at 1. Apple initially petitioned the Patent Trial and Appeal Board (“PTAB”) for IPR of all
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`1 U.S. Patent Nos. 6,748,317; 6,580,999; 8,339,493; 7,116,438; 6,408,193; 10,084,991; 6,928,306; 6,329,794;
`10,212,586; and 6,430,498.
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`Case 5:19-cv-00036-RWS Document 662 Filed 03/15/21 Page 2 of 11 PageID #: 33222
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`asserted claims of all 10 original patents-in-suit2 and moved to stay the case pending the outcome
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`of the petitions. Id. at 4; see Docket No. 239. The Court denied Apple’s motion without prejudice
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`as premature because the PTAB had not yet issued institution decisions. See Docket No. 298. The
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`PTAB instituted IPR proceedings on four of the patents, including the ’794 patent, but denied the
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`other six. Id. Apple renewed its motion to stay pending the outcome of the IPR proceedings; the
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`Court again denied Apple’s motion, finding a stay inappropriate where only eight of the 20 then-
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`asserted claims were subject to review. See Docket No. 587.
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`After the Court’s order denying a stay, Apple filed requests for ex parte reexamination
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`(“EPR”) for all remaining claims in this case not subject to IPR. Docket No. 629 at 4. Of the six
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`live patents in this case, the United States Patent and Trademark Office (“PTO”) granted EPR on
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`three—the ’317, ’999 and ’493 patents—at the time of Apple’s instant motion. Docket No. 629 at
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`1. Apple later filed notice of the PTO’s decision to grant EPR on the ’498 and ’438 patents.
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`Docket No. 649. The ’794 patent is subject to IPR. In sum, as of the date of this order, each of
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`the six asserted patents and associated claims are subject to either IPR (the ’794 patent) or EPRs
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`(the ’317, ’999, ’493, ’498 and ’438 patents). Id.
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`LEGAL STANDARDS
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`The Court has the inherent power to control its own docket, including the power to stay
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`proceedings. Landis v. N. Am. Co., 299 U.S. 248, 254 (1936). “In deciding whether to stay
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`litigation pending reexamination, courts typically consider: (1) whether a stay will unduly
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`prejudice or present a clear tactical disadvantage to the nonmoving party, (2) whether a stay will
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`simplify the issues in question and trial of the case, and (3) whether discovery is complete and
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`whether a trial date has been set.” Soverain Software LLC v. Amazon.com, Inc., 356 F.Supp.2d
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`2 Apple filed its IPR petition for the ’794 patent on December 19, 2019. Docket No. 481-1 ¶¶ 21–31.
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`Case 5:19-cv-00036-RWS Document 662 Filed 03/15/21 Page 3 of 11 PageID #: 33223
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`660, 662 (E.D. Tex. 2005) (citing Xerox Corp. v. 3Com Corp., 69 F.Supp.2d 404, 406 (W.D.N.Y.
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`1999)).
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`“Trial judges have broad discretion in deciding requests for continuances.” United States
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`v. German, 486 F.3d 849, 854 (5th Cir. 2007). The Fifth Circuit typically looks to the totality of
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`circumstances in evaluating trial court continuances. U.S. v. Stalnaker, 571 F.3d 428, 439 (5th
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`Cir. 2009). In managing its docket during the pandemic, the Court has looked to several factors
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`such as and including, but not limited to: (1) the risks posed by the pandemic and available safety
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`protocols to mitigate and reduce such risks; (2) the prejudice to parties that would result from a
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`continuance; and (3) the availability of remedial measures to address any due process concerns.
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`See, e.g., Optis Wireless Tech., LLC v. Apple Inc., Case No. 2:19-cv-66-JRG, Docket No. 387
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`(E.D. Tex. July 21, 2020); Image Processing Techs., LLC v. Samsung Elecs. Co., Case No. 2:20-
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`cv-50-JRG, Docket No. 200 (E.D. Tex. June 29, 2020). In the present case, all factors weigh
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`against granting a continuance.
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`DISCUSSION
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`Apple asks the Court to stay this case pending review of the six asserted patents by the
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`PTO or, alternatively, continue the trial date until all trial participants have had the opportunity to
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`receive a COVID-19 vaccine. Docket No. 629 at 1. Maxell opposes both requests, arguing that
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`the outcome of the pending PTO reviews is speculative and unclear and that the Court and parties
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`are prepared to safely proceed with trial on March 22, 2021, as scheduled. Docket No. 636 at 1–
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`2. The Court will first review Apple’s motion to stay.
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`I.
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`Apple’s Motion to Stay
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`Apple argues that the case should be stayed pending resolution of the review proceedings,
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`asserting that all three factors weigh in favor of a stay. Docket No. 629 at 6. Maxell responds that
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`the motion is yet another speculative attempt by Apple to further delay the vindication of Maxell’s
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`patent rights. Docket No. 636 at 1–2. Maxell contends that all three factors weigh against a stay.
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`Id. The Court will discuss each factor in turn.
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`a. Prejudice
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`Apple renews arguments raised in previous motions to stay that Maxell will not suffer
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`undue prejudice because it does not practice the patents-in-suit and can be fully compensated for
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`any alleged harm through monetary damages. Docket No. 629 at 9; see also Docket No. 481 at
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`12–13. In its previous orders denying Apple’s motions to stay pending PTO review proceedings,
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`the Court has consistently found that the prejudice factor weighs against a stay. Docket No. 587
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`at 3; Docket No. 298 at 3. Indeed, the prejudice Maxell would suffer from further delay of timely
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`enforcement of its patent rights has only grown with time. Blitzsafe Texas LLC v. Maserati North
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`America Inc., et al., Case No. 2:19-cv-00378-JRG, Docket No. 285 at 4 (E.D. Tex. Feb. 16, 2021)
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`(“Time is not an ally of prompt and fair adjudication of parties’ rights given the always present
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`risk of fading memories and witnesses who may become unexpectedly unavailable.”); see also
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`Soverain, 356 F.Supp.2d at 662; ThinkOptics, Inc. v. Nintendo of Am., Inc., 2014 WL 4477400, at
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`*1 (E.D. Tex. Feb. 27, 2014; Trover Grp., Inc. v. Dedicated Micros USA, Case No. 2:13-cv-1047,
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`2015 WL 1069179, at *2 (E.D. Tex. Mar. 11, 2015).
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`Further, as the Court has previously held, “[t]he mere fact that Maxell is not currently
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`practicing the patents does not mean that, as a matter of law, it is not prejudiced by a substantial
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`delay of an imminent trial date.” Docket No. 587 at 3 (citing Rembrandt Wireless Techs., LP v.
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`Samsung Elecs. Co., Case No. 2:13-cv-213-JRG-RSP, 2015 WL 627887, at *2 (E.D. Tex. Jan. 29,
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`2015)); Docket No. 298 at 3 (same). And Maxell’s interest in timely enforcing its patents is valid
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`“regardless [of] whether the parties’ products directly compete.” ThinkOptics, 2014 WL 4477400,
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`at *1. The prejudice factor accordingly weighs against a stay.
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`b. Stage of the Proceedings
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`Apple argues—as it has before—that while the case is on the eve of trial, the stage of
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`proceedings favors a stay because trial is “the most burdensome task” in a patent case. Docket
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`No. 629 at 10. Maxell responds that the advanced stage of the case weighs heavily against a stay,
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`as all that is left to complete is the trial itself, and Apple’s timing in filing its EPR requests strongly
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`implies that Apple’s motive is to delay this case. Docket No. 636 at 8–9.
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`This factor includes two sub-factors: “(1) whether discovery is complete and whether a
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`trial date has been set; and (2) whether the movant has unreasonably delayed filing its IPR petition
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`and motion to stay.” Stragent, LLC v. BMW of N. Am., LLC, Case No. 6:16-cv-446-RWS-KNM,
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`2017 WL 2839260, at *2 (E.D. Tex. Apr. 20, 2017). When the Court first denied Apple’s motion
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`to stay, it found that the stage of the case weighed against a stay because “[t]he case is not in its
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`infancy and is far enough along that a stay would interfere with ongoing proceedings.” Docket
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`No. 298 at 4 (citing Uniloc 2017 LLC v. Samsung Elec. Am., Inc., Case No. 2:19-cv-00259-JRG-
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`RSP, 2020 WL 143360, at *5 (E.D. Tex. Mar. 24, 2020); NFC Techs. LLC v. HTC Am., Inc., Case
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`No. 2:13-cv-1058-WCB, 2015 WL 1069111, at *4 (E.D. Tex. Mar. 11, 2015)). In denying Apple’s
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`subsequent motion, the Court noted that “the fact that proceedings have advanced even further
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`since the Court’s order and both the parties and the Court have expended significant resources in
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`the progress of this case weighs more heavily against a stay than before.” Docket No. 587 at 4.
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`Apple provides no reason why the stage of the case would not weigh even more heavily in
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`opposition to a stay than it did when the Court denied its two previous motions.
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`The second sub-factor—delay—also continues to weigh against granting a stay. In its
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`initial order, the Court held that Apple’s delay in filing its IPRs weighed against a stay and noted
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`that Apple had not sufficiently explained its delay in filing the petitions. Docket No. 298 at 4.
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`Apple’s renewed motion “fare[d] no better in providing a sufficient explanation for its delay and
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`instead simply claim[ed] that it was diligent in filing its IPRs, contrary to the Court’s earlier
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`ruling.” Docket No. 587 at 5.
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`The same is true of Apple’s EPR filings. Apple waited more than 20 months to begin filing
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`EPR requests on the asserted patents and filed its last request on February 12, 2021—just over a
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`month before trial is set to begin. Docket No. 629 at 4. Each of the EPR requests was filed after
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`the two previously scheduled trial settings. Apple provides no explanation for this lengthy delay
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`in requesting EPRs.
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`“[M]otions to stay are considered on a case-by-case basis and there exists no policy in this
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`Court to routinely grant such motions. To do so would turn reexamination into an administrative
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`process that must be completed before a suit for patent infringement may move forward.” Eon
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`Corp. IP Holdings, LLC v. Skytel Corp., Case No. 6:08-cv-385, 2009 WL 8590963, at *4 (E.D.
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`Tex. Apr. 29, 2009). The use of EPR proceedings as a dilatory tactic must be considered by the
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`Court in deciding whether to grant a discretionary stay. Id. The fact that Apple had not begun to
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`file requests for EPR until after the initial and first reset trial dates in this matter had already passed
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`raises a question about its motive in filing these requests. Combined, the stage of the case and the
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`timing of Apple’s requests weigh heavily against a stay.
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`c. Simplification of Issues
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`The final factor—whether the stay is likely to simplify the issues at trial—is the most
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`important factor bearing on whether to grant a stay. Uniloc 2017, 2020 WL 1433960, at *5. Apple
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`argues that a stay has the potential to simplify the issues and streamline the trial process. Docket
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`No. 629 at 6–7. Maxell responds that any simplification is, at this stage, purely speculative and
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`does not outweigh the prejudice and delay resulting from a stay. Docket No. 636 at 10–11.
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`Another court in this district recently declined to grant a discretionary stay under similar
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`circumstances. In Ramot at Tel Aviv University Ltd. v. Cisco Systems, Inc., Defendant Cisco filed
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`a motion to stay pending reexamination where the PTO found substantial new questions of
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`patentability as to each of the asserted claims of the patents-in-suit and also issued Office Actions
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`rejecting all challenged claims of two of the three patents-in-suit. Case No. 2:19-cv-225-JRG,
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`Docket No. 205 at 2 (E.D. Tex. Nov. 23, 2020). Finding that the “potential for simplification will
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`be more certain in time,” the court denied Cisco’s motion without prejudice because the PTO’s
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`rejections “are only preliminary” and no Office Actions had been issued regarding the third patent-
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`in-suit. Id. at 3. “Therefore, while the ex parte reexams have the potential to simplify the issues
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`in question and the trial of this case, such simplification is currently more speculative than factual.”
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`Id. at 4 (emphasis in original).
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`The same is true here. While Apple argues that simplification is certain because all of the
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`asserted patents and claims are subject to some form of review, the court rejected that argument in
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`Ramot by declining to grant a stay where the PTO had granted EPRs on all asserted claims of the
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`patents-in-suit. And the PTO has yet to issue any preliminary Office Actions, let alone reject any
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`of the asserted claims at issue in this case.
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`Apple argues that courts have recently stayed cases under “similar circumstances,”
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`pointing to the later Ramot order staying the case and a recent order in AGIS Software Dev. LLC
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`v. Google LLC. Docket No. 629 (citing Case No. 2:19-cv-225-JRG, Docket No. 235 (E.D. Tex.
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`Jan. 13, 2021); Case No. 2:19-cv-361-JRG, Docket No. 219 (E.D. Tex. Feb. 9, 2021)). But Apple
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`disregards significant differences between the circumstances of this case and the circumstances of
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`Ramot and AGIS.
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`In Ramot, Cisco renewed its motion once the PTO had rejected all asserted claims of all
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`three patents-in-suit. Ramot, No. 2:19-cv-225-JRG, Docket No. 235 at 2. Finding that the reexams
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`had “now progressed past the point of speculation,” the court granted a stay. Id. at 4. Such is not
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`the case here. The PTO has merely granted reexamination of a portion of the asserted patents and
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`has not issued any Office Actions. Docket No. 629 at 1. The Ramot orders further support denying
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`a stay at this time where “[o]nly time will tell whether any of the [ten] asserted claims will remain,
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`uncancelled and unmodified, after the [review] procedure[s].” Case No. 2:19-cv-225-JRG, Docket
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`No. 205 at 3–4. And the circumstances of AGIS also differ significantly from this case. There the
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`PTO issued Office Actions for all patents-in-suit that modified the priority date for each patent and
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`stated that the parent patent anticipated and rendered obvious all challenged claims. Case No.
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`2:19-cv-361-JRG, Docket No. 219 at 3 (E.D. Tex. Feb. 9, 2021). Nothing of the sort has occurred
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`in this case as of the date of this order. Apple’s arguments that the likelihood of simplification
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`favors a stay are unavailing. Accordingly, this factor weighs against a stay.
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`“Given the resources that the parties and the Court have already invested in this case,
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`staying the case, based solely on speculation of what might possibly happen during reexamination,
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`would be inefficient and inappropriate.” Soverain, 356 F.Supp.2d at 663. Having considered the
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`prejudice to Maxell, the speculative nature of any simplification of issues and advanced stage of
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`the case, the Court finds that the relevant factors weigh against granting a stay at this time. Apple’s
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`motion to stay is accordingly DENIED WITHOUT PREJUDICE to refiling when “more is
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`known definitively” regarding the review proceedings’ ability to simplify the issues in this case.
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`Ramot, No. 2:19-cv-225-JRG, Docket No. 205 at 4.
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`II.
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`Apple’s Motion for Continuance
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`Apple alternatively requests that the trial be continued until “later this year so that all
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`participants who want one can get a COVID-19 vaccine.” Docket No. 629 at 10. Apple argues
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`that the current state of the COVID-19 pandemic poses a safety risk to trial participants and would
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`prejudice Apple’s right to a full and fair trial. Id. at 10–15. Maxell responds that the Court and
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`parties are prepared to safely conduct trial at the end of March and that precautions are available
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`to ensure the health and safety of trial participants. Docket No. 636 at 12-14. Maxell also notes
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`that Apple has voiced its concerns regarding COVID-19 and trial safety for the first time in this
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`motion when, statistically, COVID-19 risks were greater at the time of the two previous trial dates.
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`Id. 12–13. For the reasons set forth below, Apple’s motion for continuance is DENIED.
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`Courts in this district have begun to safely proceed with jury trials. As Judge Gilstrap
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`recently recognized, courts in the Eastern District are continuously adapting to the current
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`landscape of public health and are attentive to the risks presented by COVID-19:
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`While the COVID-19 pandemic presents serious public health concerns, the Court
`has diligently undertaken to put in place reasonable precautions in order to facilitate
`a full and fair trial, while maintaining the health and safety of those involved. The
`Court abides by the recommendations of the CDC, both in spirit and in substance,
`including implementing restrictions on access to the courthouse; providing
`guidance to counsel, witnesses, and members of the public who enter the
`courthouse; arranging frequent and recurrent sanitization of Courthouse facilities;
`and requiring all who enter the Courthouse to abide by CDC recommendations,
`including wearing a mask. These precautions help[] to ensure access to the just,
`speedy resolution of parties’ disputes, while reasonably safeguarding the public
`health. This is particularly important given the unpredictability of the pandemic,
`and the need to provide parties access to the judicial system and corresponding
`resolutions to their disputes.
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`Blitzsafe, No. 2:19-cv-00378-JRG, Docket No. 285 at 2–3. The Court has been consistently
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`mindful of the safety of the parties, court staff and potential jurors, and will continue to do so in
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`the future. And the Court is open to accommodating further precautionary requests by the parties,
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`if any. Id. at 3. “The Court therefore finds that it is reasonably prepared to safely conduct the
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`pretrial conference and jury selection.” Id.
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`The prejudice to Maxell also cautions against a continuance. If the Court were to continue
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`the trial date rather than grant a total stay of the case, Maxell’s interest in the timely enforcement
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`of its patent rights would still be prejudiced. Blitzsafe, No. 2:19-cv-00378-JRG, Docket No. 285
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`at 4. “[T]here are no assurances that the pandemic will have subsided or that the Court’s trial
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`schedule—already compacted and complicated by the pandemic—will permit trial of the present
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`case” later this year. Id. And Apple’s request that the trial be continued “until later this year when
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`those trial participants who want to receive the COVID-19 vaccine have the opportunity to do so”
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`presents a potentially indefinite interruption to the schedule in this case. Docket No. 629. Vaccine
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`availability is locality-dependent and relies on multiple factors, including age and medical history.
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`Further delay, especially one so indefinite, will plainly prejudice Maxell.
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`Apple contends that several of its expert and fact witnesses may not be able to attend the
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`trial in person due to their age, health conditions or other COVID-19 related concerns. Docket
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`No. 629 at 15. Having these witnesses testify via videoconference, Apple argues, “is no substitute
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`for the face-to-face interaction that is only possible with witnesses present in the courtroom.” Id.
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`Apple also claims that COVID-19 concerns would impact the representativeness of the jury pool,
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`affecting its right to a “full and fair trial.” Id. Maxell responds that any prejudice that may result
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`will be evenly distributed between the parties, as Maxell also has witnesses who may need to
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`testify remotely. Docket No. 636 at 15.
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`The pandemic has required flexibility from courts and litigating parties across the country
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`in adjusting to these challenging new conditions. This Court has consistently accommodated
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`parties’ precautionary requests and will continue to do so within reason. See, e.g., VirnetX Inc., et
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`al. v. Apple Inc., Case No. 6:12-cv-855-RWS, Docket No. 945 (E.D. Tex. Oct. 15, 2020)
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`(permitting virtual testimony by live witnesses at trial); Optis Wireless, No. 2:19-cv-66-JRG,
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`Docket No. 387 at 5–7 (same). As Maxell notes, witnesses for both sides may need to participate
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`remotely, obviating Apple’s concerns that it will be disproportionately impacted. Docket No. 636
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`at 15. And Apple provides no basis for its claims that a March jury trial would impact its due
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`process rights other than to “speculate as to the worst case scenario.” Blitzsafe, No. 2:19-cv-00378-
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`JRG, Docket No. 285 at 5.
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`“Having weighed the precautions already in place, the prejudice to the parties and the
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`availability of creative solutions to problems presented by the pandemic, the Court is persuaded
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`that the [trial date] in the above-captioned case should be maintained. This determination is further
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`bolstered by the unpredictability of the future state of the public health.” Blitzsafe, No. 2:19-cv-
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`00378-JRG, Docket No. 285 at 5.
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`CONCLUSION
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`For the reasons stated above, Apple’s motion to stay is DENIED WITHOUT
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`PREJUDICE and Apple’s motion to continue in the alternative is DENIED.
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`Page 11 of 11
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`.
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`____________________________________
`ROBERT W. SCHROEDER III
`UNITED STATES DISTRICT JUDGE
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`SIGNED this 15th day of March, 2021.
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