Case 6:20-cv-00272-ADA Document 100 Filed 07/07/23 Page 1 of 10
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE WESTERN DISTRICT OF TEXAS
`WACO DIVISION
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`VOIP-PAL.COM, INC.,
`Plaintiff,
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`v.
`AMAZON.COM, INC.;
`AMAZON.COM SERVICES LLC; and
`AMAZON WEB SERVICES, INC.,
`Defendants.
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`CIVIL ACTION NO. 6:20-CV-272-ADA
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`OPPOSED MOTION TO STAY PENDING THE OUTCOME OF EX PARTE
`REEXAMINATION REJECTING ALL ASSERTED CLAIMS
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`Case 6:20-cv-00272-ADA Document 100 Filed 07/07/23 Page 2 of 10
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`TABLE OF CONTENTS
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`PAGE
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`INTRODUCTION .......................................................................................................... 1
`LEGAL STANDARD ..................................................................................................... 2
`ARGUMENT .................................................................................................................. 3
`A.
`A Stay Will Simplify the Issues before the Court and Likely Eliminate the
`Need for Trial. ..................................................................................................... 3
`VoIP-Pal Will Suffer Minimal Prejudice and No Tactical Disadvantage
`from a Stay .......................................................................................................... 4
`The Status of the Case Favors a Stay .................................................................. 6
`C.
`CONCLUSION ............................................................................................................... 6
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`B.
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`I.
`II.
`III.
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`IV.
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`-i-
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`Case 6:20-cv-00272-ADA Document 100 Filed 07/07/23 Page 3 of 10
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`I.
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`INTRODUCTION
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`This case should be stayed pending the outcome of a United States Patent Office ex parte
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`reexamination given the high likelihood that the reexamination will eliminate the need to try this
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`case. The only asserted patent in this case, U.S. Patent No. 10,218,606 (“the ’606 patent”), is the
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`seventh member of its family to be litigated. All six other family members have been invalidated.
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`Now, the PTO has issued a non-final office action rejecting every asserted claim of the ’606 patent.
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`(Ex. 1.)1 As this Court has observed, claims are invalidated or amended in over 80 percent of
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`instituted ex parte reexaminations. That outcome is even more likely here because the PTO has
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`already rejected all asserted claims. TC Tech. LLC v. T-Mobile USA, Inc., 6:20-cv-00899-ADA,
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`2021 WL 8083373, at *3 (W.D. Tex. Dec. 7, 2021) (staying litigation, in part because “in 80% of
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`ex parte reexaminations, the claims are cancelled or amended” and “[i]nvalidation is especially
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`likely because the examiner has already rejected both claims as invalid in an initial office action”);
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`see also “Ex Parte Reexamination Filing Data - September 30, 2020,” available at
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`https://www.uspto.gov/sites/default/files/documents/ex_parte_historical_stats_roll_up_21Q1.pdf
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`(last accessed July 6, 2023).
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`Without a stay, the Court and the parties will be forced to engage in the futile exercise of
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`litigating patent claims that are likely to be invalidated—eliminating the need to try this case—or
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`amended—raising the issue of intervening rights and requiring, at a minimum, new contentions
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`and new claim constructions and raising the possibility of re-opening of fact and expert discovery.
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`There is no need to waste Court or party time and resources in this manner. As a non-practicing
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`entity, VoIP-Pal will suffer no undue prejudice or tactical disadvantage if this case is stayed. The
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`status of this litigation also favors a stay, with no trial date set and fact discovery having just begun.
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`1 All cited exhibits are to the Declaration of Daniel T. Shvodian, filed concurrently herewith.
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`-1-
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`Case 6:20-cv-00272-ADA Document 100 Filed 07/07/23 Page 4 of 10
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`Furthermore, this case would not be stayed for long. The PTO stated that it expects its next office
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`action to be final. That decision is expected to issue well before VoIP-Pal’s May 2024 proposed
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`trial date and would impact this litigation. That decision would also allow this litigation to resume
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`in a timely manner in the unlikely event that any asserted claim survives.
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`II.
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`LEGAL STANDARD
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`A district court has the inherent power to control its docket, including to stay proceedings
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`before it. TC Tech. LLC, 2021 WL 8083373, at *1 (granting motion to stay pending ex parte
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`reexamination) (internal citation omitted).) Courts consider three factors when deciding whether
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`to stay a case pending the resolution of PTO proceedings: “(1) whether granting the stay will
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`simplify the issues for trial; (2) the status of the litigation, particularly whether discovery is com-
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`plete and a trial date has been set; and (3) whether a stay would cause the non-movant to suffer
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`undue prejudice from any delay, or allow the movant to gain a clear tactical advantage.” TC Tech.
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`LLC v. Sprint Corp., 16-cv-00153-WCB, 2021 WL 4521045, at *2 (D. Del. Oct. 4, 2021).
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`As this Court has recently held, a stay is particularly justified when “the outcome of a PTO
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`proceeding is likely to assist the court in determining patent validity or eliminate the need to try
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`infringement issues.” TC Tech. LLC., 2021 WL 8083373, at *1 (quoting NFC Tech. LLC v. HTC
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`Am., Inc., 2:13-cv-1058, 2015 WL 1069111, at *1 (E.D. Tex. Mar. 11, 2015)). Proceedings di-
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`rected to all asserted claims that can “dispose of the entire litigation” present “the ultimate simpli-
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`fication of issues.” VirtualAgility Inc. v. Salesforce.com, Inc., 759 F.3d 1307, 1314 (Fed. Cir.
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`2014).
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`The reasoning in the legislative history of the AIA that Congress intended “for district
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`courts to be liberal in granting stays” pending post-grant review applies equally here. “Congress
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`intended to place ‘a very heavy thumb on the scale in favor of a stay being granted’” once the
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`-2-
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`Patent Office institutes review. TC Tech. LLC, 2021 WL 4521045, at *3 (granting motion to stay
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`pending ex parte review) (quoting 157 Cong. Rec. S1363, 2011).
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`III. ARGUMENT
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`A.
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`A Stay Will Simplify the Issues before the Court and Likely Eliminate the
`Need for Trial.
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`The “most important” factor in determining whether to issue a stay is whether it “will result
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`in simplification of issues before the Court.” TC Tech., 2021 WL 8083373, at *3 (granting motion
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`to stay pending ex parte re-examination) (internal citation omitted).
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`This factor strongly favors imposing a stay because the pending ex parte reexamination is
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`likely to eliminate the need for a trial. As this Court has observed, ex parte reexaminations are
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`likely to eliminate the need for trial where, as here, the PTO has issued a non-final office action
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`rejecting all asserted claims. Id. at *3 (staying case in view of pending ex parte reexamination, in
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`part because “[i]nvalidation is especially likely because the examiner has already rejected [all as-
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`serted] claims as invalid in an initial office action”). The possibility of invalidating asserted claims
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`before the PTO is “the ultimate simplification of issues” and strongly favors imposing a stay. Vir-
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`tualAgility Inc., 759 F.3d at 1314; AGIS Software Dev. LLC v. Google LLC, 2:19-CV-00361-JRG,
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`2021 WL 465424, at *2 (E.D. Tex. Feb. 9, 2021) (staying litigation, noting that when the “PTO
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`has granted EPR[]s as to all claims of all asserted patents, this Court has likewise routinely stayed
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`cases”).
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`This factor favors a stay, even if VoIP-Pal is able to amend the asserted claims. Any
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`amendments would force the parties to re-litigate this case because it would raise new issues (such
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`as intervening rights) and would require new contentions, new Markman proceedings, and poten-
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`tially new fact and expert discovery. Given the overwhelming likelihood that the asserted claims
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`will not survive the ex parte reexamination in their current form, the Court and the parties should
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`-3-
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`Case 6:20-cv-00272-ADA Document 100 Filed 07/07/23 Page 6 of 10
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`not be forced to spend the considerable time and resources needed to litigate the claims as-is.
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`Ramot at Tel Aviv Univ. Ltd. v. Cisco Sys., Inc., 2:19-CV-00225-JRG, 2021 WL 121154, at *2
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`(E.D. Tex. Jan. 13, 2021) (staying case on eve of trial after initial office action because “the as-
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`serted claims that have been rejected in the reexamination proceedings are almost surely to be
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`modified in some material way in response to their rejection [in a non-final office action], and they
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`may be dropped completely”).
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`B.
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`VoIP-Pal Will Suffer Minimal Prejudice and No Tactical Disadvantage from
`a Stay
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`This factor also favors imposing a stay. Any harm VoIP-Pal might suffer from a stay would
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`be minimal. First, any delay would be minimal because the PTO asked VoIP-Pal to include any
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`proposed amendments in its next response and stated that it expects its next office action to be
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`final. (Ex. 1 at 53.)2 The ex parte examination is therefore expected to conclude well before the
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`May 2024 trial date that VoIP-Pal has requested in this case. As this Court noted in TC Tech, any
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`prejudice caused to plaintiff by a stay is minimal where the PTO’s final decision is likely to issue
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`before the trial date. TC Tech, 2021 WL 8083373, at *2.
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`Second, VoIP-Pal should not be heard to complain of any delay because VoIP-Pal itself is
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`delaying resolution of the ex parte reexamination. The PTO issued a non-final office action re-
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`jecting all asserted claims, stating that the next office action was likely to be final, and requiring
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`VoIP-Pal to file its response to the non-final office action within two months. (Ex. 1 at 4, 53.)
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`VoIP-Pal requested a one-month extension, placing its response due on July 24 (less than three
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`weeks from now). (Ex. 2 at 2 (requesting the extension, in part, because VoIP-Pal is “engaged in
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`related litigation in connection with the ’606 Patent and has needed to devote time and resource to
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`that effort”).) As this Court has observed, patentees can minimize the delay—and any associated
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`2 In citations to the Office Action, the page cites refer to the PDF page numbers.
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`-4-
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`burden—caused by a stay of litigation in favor of ex parte proceedings by responding to office
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`actions early. TC Tech, 2021 WL 8083373, at *2 (noting that plaintiff can minimize prejudice
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`caused by a stay because “[a] decision by the PTO could of course happen even earlier… [if plain-
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`tiff] expedite[d] the proceedings itself by filing quickly”). VoIP-Pal could have mitigated any
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`prejudice of a stay by responding to the PTO’s office action promptly. VoIP-Pal instead has cho-
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`sen to try to delay the resolution of the ex parte reexamination. Any delay in resolution of the ex
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`parte reexamination is due, at least in part, to VoIP-Pal’s own request for delay.
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`Third, a stay would cause no undue prejudice to VoIP-Pal. As a non-practicing entity, the
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`only prejudice VoIP-Pal could suffer is a delay in the disposition of this case. That is not sufficient
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`to deny a stay of proceedings. See, e.g., CyWee Grp. Ltd. v. Samsung Elecs. Co., 2:17-cv-00140-
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`WCB (RSP), 2019 WL 11023976, at *4, 6 (E.D. Tex. Feb. 14, 2019) (granting stay, in part, be-
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`cause as a non-practicing entity, “the only element of prejudice [plaintiff] has been able to demon-
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`strate is the prejudice that always accompanies a delay in the disposition of a case—a postpone-
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`ment in the plaintiff’s obtaining a judgment”); Landmark Tech., LLC. v. iRobot Corp., 6:13-cv-
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`00411-JDL, 2014 WL 486836, at *4 (E.D. Tex. Jan. 24, 2014) (granting stay, in part, because
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`prejudice to non-practicing entity would be minimal); Realtime Data, LLC v. Hewlett Packard
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`Enter. Co., 6:16-cv-00086-RSW (JDL), 2017 WL 3712916, at *6 (E.D. Tex. Feb. 3, 2017) (grant-
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`ing stay and noting that non-practicing entity’s “concerns such as timely enforcement of patent
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`rights are generally too generic, standing alone, to defeat a stay motion” (citations omitted).)3
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`VoIP-Pal cannot point to any specific prejudice that would result from this stay. This factor there-
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`fore also favors staying the case.
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`3 Nor is there any credible reason to believe that a stay would risk a loss of evidence or witness
`memory given that the PTO’s next office action is expected to be final and to issue soon.
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`-5-
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`C.
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`The Status of the Case Favors a Stay
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`This factor also favors a stay. Stays are more favored the earlier they occur in the litigation.
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`Kirsch Rsch. and Dev., LLC v. IKO Indus., Inc., 6:20-cv-00317-ADA, 2021 WL 4555610, at *2-3
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`(W.D. Tex. Oct. 4, 2021) (granting stay in favor of pending IPR). The Markman process recently
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`concluded, and VoIP-Pal proposed six more months of fact discovery and trial over 10 months
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`from now.4 See, e.g., id. (granting stay six months after Markman hearing). Staying the case for
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`a short while now would allow the parties to avoid the considerable time and expense of engaging
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`in fact discovery and the preparation of final contentions—often the most expensive and resource-
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`intensive stages of litigation—for claims that are likely to be invalidated or amended in the coming
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`months. This factor, therefore, strongly favors a stay.
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`IV. CONCLUSION
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`For the foregoing reasons, Amazon’s Motion to Stay Pending the Outcome of Ex Parte
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`Reexamination Rejecting All Asserted Claims should be granted.
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`4 This case was previously stayed pending the outcome of a transfer motion (Dkt. 47.). That
`does not translate to the case being at an advanced stage for the purposes of this analysis. TC Tech,
`2021 WL8083373, at *3 (staying case until ex parte reexamination concludes after the case had
`previously been stayed for six months, noting that “the amount of time since the filing of the Com-
`plaint [] does not translate to this case being at an advanced stage”).
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`-6-
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`Case 6:20-cv-00272-ADA Document 100 Filed 07/07/23 Page 9 of 10
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`Dated: July 7, 2023
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`Respectfully submitted,
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`/s/ Daniel T. Shvodian
`M. Craig Tyler, Bar No. 00794762
`Perkins Coie LLP
`500 W 2nd St, Suite 1900
`Austin, TX 78701-4687
`Tel. No. 737.256.6113
`Fax No. 737.256.6300
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`Daniel T. Shvodian, Admitted Pro Hac Vice
`DShvodian@perkinscoie.com
`Christopher Kelley, Admitted Pro Hac Vice
`CKelley@perkinscoie.com
`PERKINS COIE LLP
`3150 Porter Drive
`Palo Alto, California 94304-1212
`Tel. No. 650.838.4300
`Fax No. 650.838.4350
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`Attorneys for Defendants
`Amazon.com, Inc.; Amazon.com, Services LLC;
`and Amazon Web Services, Inc.
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`-7-
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`Case 6:20-cv-00272-ADA Document 100 Filed 07/07/23 Page 10 of 10
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`CERTIFICATE OF CONFERENCE
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`The undersigned hereby certifies that during the negotiation regarding the case schedule, I
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`asked VoIP-Pal to agree to stay the case pending resolution of the reexamination, and VoIP-Pal
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`rejected that request.
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`/s/ Daniel T. Shvodian
`Daniel T. Shvodian
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`CERTIFICATE OF SERVICE
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`The undersigned hereby certifies that a true and correct copy of the above and foregoing
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`document has been served July 7, 2023 to all counsel of record, via the Court's CM/ECF system.
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`/s/ Daniel T. Shvodian
`Daniel T. Shvodian
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