Case 6:20-cv-00212-ADA Document 36 Filed 08/14/20 Page 1 of 8
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE WESTERN DISTRICT OF TEXAS
`WACO DIVISION
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`NEODRON, LTD.,
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`Plaintiff,
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`v.
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`APPLE INC.,
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`Case No. 6:20-cv-00212-ADA
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`PATENT CASE
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`Defendant.
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`JURY TRIAL DEMANDED
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`APPLE INC.’S MOTION TO STAY PENDING TRANSFER
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`Case 6:20-cv-00212-ADA Document 36 Filed 08/14/20 Page 2 of 8
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`Apple respectfully moves for a stay pending a decision on Apple’s pending Motion to
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`Transfer to the Northern District of California (“the NDCAL”) (Dkt. No. 27).
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`I.
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`INTRODUCTION
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`Both the Federal Circuit and the Fifth Circuit have instructed district courts to prioritize
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`transfer motions and to address transfer before addressing other substantive issues. However, in
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`this case, the current schedule calls for the parties to complete time-consuming and expensive
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`patent disclosures and claim construction activities from September through January. In light of
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`the appellate mandate to make transfer a “top priority,” these other activities should be stayed
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`pending a decision on transfer.
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`II.
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`BACKGROUND
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`Neodron is asserting three patents against Apple relating to touch sensing technology and
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`has accused numerous Apple products as infringing those patents, including fifteen iPhone
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`models, eleven iPad models, and six Macbook models. The Court held a CMC on June 19, 2020,
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`and set the Markman hearing in this case for January 15, 2021. On July 2, 2020, Apple timely
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`filed its Motion to Transfer this case to the NDCAL. After not receiving an opposition brief on
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`the original due date, Apple contacted Neodron to ascertain the status of the response. Shortly
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`after the contact from Apple, Neodron filed its opposition and sought Apple’s consent to an
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`extension of time to July 28, 2020, which Apple provided. Apple filed its Reply brief on August
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`11th and then promptly filed this Motion to Stay – after confirming Neodron would oppose.
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`Case 6:20-cv-00212-ADA Document 36 Filed 08/14/20 Page 3 of 8
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`III.
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`ALL CASE ACTIVITY UNRELATED TO TRANSFER SHOULD BE STAYED
`PENDING RESOLUTION OF APPLE’S MOTION TO TRANSFER
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`A.
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`The Court Has Inherent Authority to Stay the Case
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`“The power to stay proceedings is incidental to the power inherent in every court to
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`control the disposition of the cases on its docket with economy of time and effort for itself, for
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`counsel, and for litigants.”). Landis v. N. Am. Co., 299 U.S. 248, 254–55, 57 S. Ct. 163 (1936).
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`Both the Federal Circuit and the Fifth Circuit have noted that transfer motions should be
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`given “top priority” and should therefore be decided before other substantive issues are
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`addressed. In re EMC Corp., 501 Fed. Appx. 973, 975-76 (Fed. Cir. 2013) (recognizing “the
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`importance of addressing motions to transfer at the outset of litigation”); In re Horseshoe Entm’t,
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`337 F.3d 429, 433 (5th Cir. 2003) (“[I]n our view disposition of that [transfer] motion should
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`have taken a top priority in handling of this case by the . . . District Court.”); see also In re
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`Fusion-IO, Inc., 489 Fed. Appx. 465, 466 (Fed. Cir. 2012) (“We fully expect, however, for
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`Fusion-IO to promptly request transfer in the lead case along with a motion to stay proceedings
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`pending disposition of the transfer motion, and for the district court to act on those motions
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`before proceeding to any motion on the merits of the action”).
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`To effectuate this appellate mandate, district courts have agreed to stay cases pending
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`decisions on transfer. See Secure Axcess, LLC v. Nintendo of Am., Inc., No. 2:13-cv-00032, Dkt.
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`No. 133 (E.D. Tex. Feb. 10, 2014) (granting a stay pending resolution of severance and transfer
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`issues where case was in early stages and claim construction briefing had just begun); DSS Tech.,
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`Mgmt. Inc., v. Apple Inc., No. 6:13-cv-919, Dkt. No. 83 (E.D. Tex. Oct. 28, 2014); Anza Tech.,
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`Inc., v. Xilinx, Inc., 17-cv-687, 2017 WL 10379350 (D. Col. Oct. 16, 2017); Univ. of S. Florida
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`Res. Found. Inc. v. Fujifilm Med. Sys. USA, Inc., No. 8:16-cv-1194, 2017 WL 4155344, at *1
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`(M.D. Fla. Aug. 29, 2017) (granting motion to stay deadlines pending resolution of whether
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`venue was proper in the district); B.E. Tech., LLC v. Sony Computer Entm’t Am., LLC, No. 12-
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`cv-2828, 2013 WL 524893, at*1 (W.D. Tenn. Feb. 11, 2013) (“Staying the proceedings--
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`including the Local Patent Rule disclosures and fact discovery--will allow the Court to properly
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`decide the pending Motions to Change Venue in light of judicial economy and comity.”)1
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`The Federal Circuit has recognized the importance of staying cases during the pendency
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`of transfer motions as a means of upholding 28 U.S.C. 1404(a)’s intent to “prevent the waste ‘of
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`time, energy, and money’ and protect litigants, witnesses and the public against unnecessary
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`inconvenience and expense [. . . ] when defendants are forced to expend resources litigating
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`substantive matters in an inconvenient venue while a motion to transfer lingers unnecessarily on
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`the docket.” In re Google Inc., 2015 WL 5294800, at *1-2 (Fed. Cir. 2015) (internal citation
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`omitted) (granting writ of mandamus and ordering a magistrate judge in the Eastern District of
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`Texas to stay proceedings pending final resolution of a transfer motion filed 8 months prior and
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`issue a decision on transfer within 30 days).
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`B.
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`All Relevant Factors Favor a Stay Pending a Decision on Transfer
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`In this District, courts typically consider three factors in determining whether a stay is
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`warranted: (1) any potential prejudice to the non-moving party; (2) the hardship and inequity to
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`the moving party if the action is not stayed; and (3) the judicial resources saved by avoiding
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`duplicative litigation. Yeti Coolers, LLC v. Home Depot U.S.A., Inc., 1:17-cv-342, 2018 WL
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`2122868, at *1 (W.D. Tex. Jan. 8, 2018); B & D Produce Sales, LLC v. Packman1, Inc., No. SA-
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`16-CV-99-XR, 2016 WL 4435275, at *1 (W.D. Tex. Aug. 19, 2016). Here, all three factors
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`favor a stay.
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`1 This Court has similarly recognized the utility of a stay pending transfer in the context of multi-
`district litigation. See also Sparling v. Doyle, 2014 WL 12489985 (March 3, 2014) (granting
`temporary stay until MDL panel renders decision on motion for transfer and consolidation).
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`1.
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`Factor One: A Stay Will Not Prejudice Neodron
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`Neodron will not suffer any prejudice as a result of a stay pending a decision on transfer.
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`In fact, should the case be transferred, Neodron will benefit from proceeding once under the
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`Markman procedures employed by the transferee forum. Avoiding duplication will benefit both
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`Apple and Neodron.
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`Should Neodron claim that the short stay sought here would cause it prejudice, any such
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`argument lacks merit. First, a delay in Neodron’s attempt to recover money damages cannot, of
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`itself, constitute sufficient prejudice to deny a stay because a plaintiff will always face that
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`possibility when a stay is ordered. SanDisk Corp. v. Phison Elecs. Corp., 538 F. Supp. 2d 1060,
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`1067 (W.D. Wisc. 2008) (“plaintiff’s only real ‘injury’ is that it will have to wait for any money
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`damages, which is always the case when a stay is imposed.”). Second, Apple is seeking a stay of
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`a very limited duration so that transfer issues are decided before other substantive issues are
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`addressed. Even assuming the Court takes 60 days to resolve the transfer issue, this case could
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`still go to trial within two years of filing. Neodron cannot seriously claim that a two year
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`schedule to trial is prejudicial. Therefore, this factor strongly favors a stay.
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`2.
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`Factor Two: Apple Will Suffer Hardship Absent a Stay
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`The Federal Circuit and Fifth Circuit agree that deciding transfer should be the Court’s
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`top priority in handling the case. EMC Corp., 501 Fed. Appx. at 975-76; Horseshoe Entm’t, 337
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`F.3d at 433. Moving forward now with patent disclosures and claim construction activities in
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`this case will risk the very same “waste of time, energy and money” the Federal Circuit
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`cautioned against in EMC. EMC Corp., 501 Fed. Appx. at 975-76. Indeed, if this case is
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`transferred to the NDCAL, that court has its own local rules and Markman procedures that differ
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`from those employed by this Court. In all likelihood, Apple will need to redo its claim
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`construction submissions to comply with the NDCAL rules. In addition, should this Court issue
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`claim constructions before deciding transfer, the transferee court may wish to conduct its own
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`analysis and hearing, thus causing additional burden and expense. Conversely, by staying the
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`Markman activity in this case for a short period of time while first deciding transfer, the risk of
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`undue hardship is completely eliminated.
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`3.
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`Factor Three: A Stay Will Conserve Judicial Resources
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`A stay pending a decision on transfer will conserve judicial resources as it eliminates the
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`risk that the Markman proceedings will be conducted twice in two different courts. A stay will
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`also avoid potential confusion as, absent a stay, a decision on transfer could be issued during the
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`middle of claim construction briefing in this case. That could leave Apple and Neodron in a
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`situation where one set of briefs is filed in accordance with this Court’s Order Governing
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`Proceedings only to have subsequent briefing procedures governed by the NDCAL patent local
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`rules, which differ from this Court’s. A stay would also eliminate this likely confusion and
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`uncertainty.
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`IV.
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`CONCLUSION
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`For the foregoing reasons, the Court should stay all case activity unrelated to transfer
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`until a decision on transfer is rendered.
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`Dated: August 14, 2020
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`Respectfully submitted,
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`/s/ John M. Guaragna
`John M. Guaragna
`Texas Bar No 24043308
`Brian K. Erickson
`Texas Bar No. 24012594
`DLA PIPER LLP (US)
`401 Congress Avenue, Suite 2500
`Austin, TX 78701-3799
`Tel: 512.457.7125
`Fax: 512.457.7001
`john.guaragna@dlapiper.com
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`5
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`brian.erickson@dlapiper.com
`
`Mark Fowler (pro hac vice)
`Robert Buergi (pro hac vice)
`DLA Piper LLP (US)
`2000 University Avenue
`East Palo Alto, CA 94303
`Tel: 650-833-2000
`Fax: 650-833-2100
`
`Erin Gibson (pro hac vice)
`DLA Piper LLP (US)
`401 B Street, Suite 1700
`San Diego, CA 92101
`Tel: 619-699-2700
`Fax: 619-699-2701
`
`James M. Heintz (pro hac vice)
`DLA Piper LLP (US)
`One Fountain Square
`11911 Freedom Drive, Suite 300
`Reston, VA 20190
`Tel: 703-773-4000
`Fax: 703-773-5000
`
`Nandan Padmanabhan (pro hac vice)
`DLA Piper LLP (US)
`2000 Avenue of the Stars, Suite 400
`North Tower
`Los Angeles, CA 90067
`Tel: 310-595-3000
`Fax: 310-595-3300
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`Erin McLaughlin (pro hac vice)
`DLA Piper LLP (US)
`1251 Avenue of the Americas, 27th Floor
`New York, NY 10020
`Tel: 212-335-4500
`Fax: 212-335-4501
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`ATTORNEYS FOR DEFENDANT APPLE INC.
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`CERTIFICATE OF CONFERENCE
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`Pursuant to Local Rule CV-7(i), counsel for Apple has conferred with counsel for
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`Neodron in a good-faith effort to resolve the matter presented herein. Counsel for Neodron
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`opposes the instant Motion.
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`/s/ John M. Guaragna
`John M. Guaragna
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`CERTIFICATE OF SERVICE
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`The undersigned certifies that on this 14th day of August 2020, all counsel of record who
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`are deemed to have consented to electronic service are being served with a copy of this document
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`by electronic mail.
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`/s/ John M. Guaragna
`John M. Guaragna
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