Case 5:15-cv-02008-EJD Document 103 Filed 05/24/16 Page 1 of 18
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`GEORGE A. RILEY (S.B. #118304)
`griley@omm.com
`LUANN L. SIMMONS (S.B. #203526)
`lsimmons@omm.com
`MELODY DRUMMOND HANSEN (S.B. #278786)
`mdrummondhansen@omm.com
`O’MELVENY & MYERS LLP
`Two Embarcadero Center, 28th Floor
`San Francisco, California 94111-3823
`Telephone:
`(415) 984-8700
`Facsimile:
`(415) 984-8701
`
`RYAN K. YAGURA (S.B. #197619)
`ryagura@omm.com
`XIN-YI ZHOU (S.B. #251969)
`vzhou@omm.com
`BRIAN M. COOK (S.B. #266181)
`bcook@omm.com
`KEVIN MURRAY (S.B. #275186)
`kmurray2@omm.com
`O’MELVENY & MYERS LLP
`400 South Hope Street
`Los Angeles, California 90071-2899
`Telephone:
`(213) 430-6000
`Facsimile:
`(213) 430-6407
`
`Attorneys for Defendant
`APPLE INC.
`
`
`UNITED STATES DISTRICT COURT
`
`NORTHERN DISTRICT OF CALIFORNIA
`
`SAN JOSE
`
`OpenTV, Inc., Nagravision, SA, and Nagra
`France S.A.S.,
`
`v.
`
`Apple Inc.,
`
`Plaintiffs,
`
`Defendant.
`
`Case No. 5:15-CV-02008-EJD
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`DEFENDANT APPLE INC.’S REPLY IN
`SUPPORT OF MOTION TO STAY
`PENDING COMPLETION OF USPTO
`PROCEEDINGS
`
`Date: September 15, 2016
`Time: 9:00 a.m.
`Judge: Honorable Edward J. Davila
`Courtroom: 4
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`REPLY ISO MOTION TO STAY
`5:15-CV-02008-EJD
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`Case 5:15-cv-02008-EJD Document 103 Filed 05/24/16 Page 2 of 18
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`TABLE OF CONTENTS
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`Page
`INTRODUCTION ............................................................................................................... 1
`ALL RELEVANT FACTORS FAVOR A STAY ............................................................... 2
`A.
`The First Factor Favors A Stay Because Discovery Is Far From Complete
`And A Trial Date Has Not Been Set. ....................................................................... 3
`The Second Factor Favors A Stay Because The USPTO Proceedings Will
`Simplify Issues For Trial. ......................................................................................... 6
`1.
`There Is A High Probability That Apple’s Petitions Will Be
`Granted ......................................................................................................... 6
`This Case Will Be Simplified After Completion of PTAB Reviews ........... 7
`2.
`OpenTV Misrepresents PTAB Statistics ...................................................... 8
`3.
`The Third Factor Favors A Stay Because OpenTV Will Not Suffer Any
`Tactical Disadvantage Or Undue Prejudice. ............................................................ 9
`OPENTV’S ATTEMPT TO TIE APPLE’S MOTION TO STAY TO OPENTV’S
`MOTION FOR RULE 54(b) CERTIFICATION SHOULD BE REJECTED ................... 12
`CONCLUSION .................................................................................................................. 13
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`B.
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`C.
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`I.
`II.
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`III.
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`IV.
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`Case 5:15-cv-02008-EJD Document 103 Filed 05/24/16 Page 3 of 18
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`TABLE OF AUTHORITIES
`
`
`Page
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`CASES
`ActiveVideo Networks, Inc. v. Verizon Commc’ns, Inc.,
`694 F.3d 1312 (Fed. Cir. 2012) ................................................................................................ 11
`Adaptix, Inc. v. HTC Corp.,
`No. 5:14-cv-02359-PSG, slip op. (N.D. Cal. Aug. 5, 2015) ...................................................... 5
`Affinity Labs of Tex. v. Apple Inc.,
`2010 U.S. Dist. LEXIS 50974 (N.D. Cal. Apr. 29, 2010) ......................................................... 5
`AT&T Intellectual Prop. I v. TiVo, Inc.,
`774 F. Supp. 2d 1049 (N.D. Cal. 2011) ..................................................................................... 9
`Convergence Techs. (USA), LLC v. Microloops Corp.,
`2012 WL 1232187 (N.D. Cal. Apr. 12, 2012) ........................................................................... 9
`Cypress Semiconductor Corp. v. LG Elecs., Inc.,
`2014 U.S. Dist. LEXIS 153401 (N.D. Cal. Oct. 28, 2014) ........................................................ 9
`DSS Tech. Mgmt., Inc. v. Apple Inc.,
`2015 WL 1967878 (N.D. Cal. May 1, 2015) ............................................................................. 3
`eSoft, Inc. v. Blue Coat Sys.,
`505 F. Supp. 2d 784 (D. Colo. 2007) ..................................................................................... 3, 5
`Evolutionary Intelligence LLC v. Yelp Inc.,
`2013 U.S. Dist. LEXIS 178547 (N.D. Cal. Dec. 18, 2013) ................................................. 2, 10
`Hamilton v. Rodriguez,
`2013 U.S. Dist. LEXIS 107733 (N.D. Cal. July 31, 2013) ...................................................... 12
`iLOR, LLC v. Google, Inc.,
`550 F.3d 1067 (Fed. Cir. 2008) ................................................................................................ 12
`Implicit Networks, Inc. v. Advanced Micro Devices, Inc.,
`2009 WL 357902 (W.D. Wash. Feb. 9, 2009) ......................................................................... 11
`Internet Patents Corp. v. eBags, Inc.,
`2013 U.S. Dist. LEXIS 122868 (N.D. Cal. Aug. 28, 2013) ..................................................... 12
`LELO, Inc. v. Standard Innovation (US) Corp.,
`2014 WL 2879851 (N.D. Cal. June 24, 2014) ........................................................................... 7
`Microsoft Corp. v. TiVo Inc.,
`2011 U.S. Dist. LEXIS 52619 (N.D. Cal. May 6, 2011) ........................................................... 5
`Montes v. Rafalowski,
`2012 U.S. Dist. LEXIS 158565 (N.D. Cal. Nov. 2, 2012) ....................................................... 12
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`REPLY ISO MOTION TO STAY
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`Case 5:15-cv-02008-EJD Document 103 Filed 05/24/16 Page 4 of 18
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`TABLE OF AUTHORITIES
`(continued)
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`
`Page
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`Morrison-Knudsen Co. v. Archer,
`655 F.2d 962 (9th Cir. 1981) .................................................................................................... 12
`Motson v. Franklin Covey Co.,
`2005 U.S. Dist. LEXIS 34067 (D.N.J. Dec. 16, 2005) .............................................................. 5
`OpenTV Inc. v. Apple Inc.,
`No. 14-cv-01622-HSG, 2015 U.S. Dist. LEXIS 143388 (N.D. Cal. Oct. 21,
`2015) ................................................................................................................................. passim
`OpenTV Inc. v. Netflix Inc.,
`No. 14-cv-0525-RS, ECF No. 79 (N.D. Cal. Feb. 11, 2015) ..................................................... 6
`PersonalWeb Technologies, LLC v. Facebook, Inc.,
`2014 WL 116340 (N.D. Cal. Jan. 13, 2014) ........................................................................ 3, 11
`PersonalWeb Technologies, LLC v. Google Inc.,
`2014 WL 4100743 (N.D. Cal. Aug. 20, 2014) ........................................................................... 7
`Reddy v. Nuance Commc’ns,
`2012 U.S. Dist. LEXIS 138652 (N.D. Cal. Sept. 26, 2012)..................................................... 12
`Sec. People, Inc. v. Ojmar US, LLC,
`2015 WL 3453780 (N.D. Cal. May 29, 2015) ..................................................................... 6, 10
`Software Rights Archive, LLC v. Facebook, Inc.,
`2013 WL 5225522 (N.D. Cal. Sept. 17, 2013) .............................................................. 5, 10, 11
`Tsyn v. Wells Fargo Advisors, LLC,
`2016 U.S. Dist. LEXIS 57519 (N.D. Cal. Apr. 29, 2016) ....................................................... 12
`Verinata Health, Inc. v. Ariosa Diagnostics, Inc.,
`2014 WL 121640 (N.D. Cal. Jan. 13, 2014) .............................................................................. 5
`Wang v. Asset Acceptance, LLC,
`2010 U.S. Dist. LEXIS 119620 (N.D. Cal. Nov. 1, 2010) ....................................................... 12
`
`
`STATUTES
`35 U.S.C. § 101 .......................................................................................................................... 2, 13
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`35 U.S.C. § 315(e)(2) ................................................................................................................. 7, 10
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`AIA § 18(a)(1)(D) ...................................................................................................................... 7, 10
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`Case 5:15-cv-02008-EJD Document 103 Filed 05/24/16 Page 5 of 18
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`TABLE OF AUTHORITIES
`(continued)
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`
`RULES
`Fed. R. Civ. P. 54(b) ...................................................................................................... 2, 10, 12, 13
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`Case 5:15-cv-02008-EJD Document 103 Filed 05/24/16 Page 6 of 18
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`I.
`
`INTRODUCTION
`All patents remaining at issue in this case are subject to petitions pending before the
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`United States Patent and Trademark Office (“USPTO”) for inter partes review (“IPR”), covered
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`business method review (“CBM”), or both. Apple diligently prepared and filed petitions for IPR
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`and CBM, and promptly moved to stay this case after filing those petitions. Apple’s motion
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`should be granted because all relevant factors favor a stay of this case. First, the discovery in this
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`case is far from completion, and a trial date has not been set. Thus, a stay will eliminate or
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`streamline the remaining fact discovery, expert discovery, summary judgment, pre-trial
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`preparation, and trial. Second, the pending IPR and CBM petitions address all asserted claims of
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`the remaining patents-in-suit, and therefore have the potential to render moot or significantly
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`simplify this case. Third, as a non-competitor to Apple that seeks only monetary compensation,
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`OpenTV will suffer no tactical disadvantage or undue prejudice from a stay.
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`In its opposition, OpenTV fails to identify a single factor that weighs against a stay.
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`OpenTV argues that significant discovery has occurred, but misleadingly relies on discovery from
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`another case between Apple and OpenTV. OpenTV argues that Apple’s motion is speculative
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`and premature because the Patent Trial and Appeal Board (“PTAB”) has yet to grant Apple’s
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`petitions. But USPTO statistics show that nearly three quarters of IPR and CBM petitions are
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`instituted for trial. In fact, to date, the PTAB has instituted all prior IPRs filed against OpenTV’s
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`patents, including an IPR filed by Netflix against one of the patents-in-suit and all four IPRs filed
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`by Apple against OpenTV patents asserted in another case between the parties. There is no
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`reason to believe the outcome of the IPRs and CBM in this case would be any different.
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`OpenTV fails to identify any harm it would suffer from a stay, and presents the same
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`“prejudice” arguments already considered and rejected by another court in this district. See
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`OpenTV Inc. v. Apple Inc., No. 14-cv-01622-HSG, 2015 U.S. Dist. LEXIS 143388, at *11-12
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`(N.D. Cal. Oct. 21, 2015) (“OpenTV I”). OpenTV argues that Apple “extensive[ly] delay[ed]” in
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`seeking a stay because this case has been pending for twelve months. See ECF No. 101 at 1.
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`Apple has not caused any unnecessary delay. In parallel with other litigation tasks, Apple
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`diligently prepared and filed its IPR and CBM petitions—which included over 500 pages of
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`Case 5:15-cv-02008-EJD Document 103 Filed 05/24/16 Page 7 of 18
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`materials—within the period permitted under the patent statute, as it “was entitled to do [] under
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`35 U.S.C. § 315(b).” Evolutionary Intelligence LLC v. Yelp Inc., 2013 U.S. Dist. LEXIS 178547,
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`at *28-29 (N.D. Cal. Dec. 18, 2013). As the party seeking “protection under the patent statutory
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`framework,” OpenTV “may not complain of the rights afforded to others by that same statutory
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`framework.” Id. Furthermore, because “the parties are not direct competitors,” OpenTV will not
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`be prejudiced from a stay and “can be fully restored to the status quo ante with monetary relief.”
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`OpenTV I, 2015 U.S. Dist. LEXIS 143388, at *12.
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`OpenTV also argues that if the Court grants Apple’s motion to stay, it should also allow
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`OpenTV to file an interlocutory appeal of this Court’s dismissal of two OpenTV patents under 35
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`U.S.C. § 101. As with its original motion for Rule 54(b) certification, OpenTV fails to identify
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`any unusual circumstance or pressing need that supports OpenTV’s motion. There is no judicial
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`efficiency that could be gained from allowing OpenTV to immediately appeal this Court’s
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`decision while the PTAB is still reviewing OpenTV’s patents. In contrast, there are judicial
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`efficiencies in allowing all of the appeals to proceed at the same time to the Federal Circuit at the
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`conclusion of the IPR and CBM proceedings, particularly where multiple appeals relate to the
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`same patent.
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`At the current stage of the litigation, it would be far more efficient to stay this case in its
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`entirety pending completion of the IPR and CBM proceedings, rather than initiating parallel trials
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`and appeals before this Court, the PTAB, and the Federal Circuit. Although the parties have
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`engaged in some fact discovery and the Court has held a claim construction hearing, no Markman
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`order has issued and substantial technical discovery remains. Thus, in the interest of judicial
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`economy, Apple respectfully requests that the Court stay this case pending completion of the
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`USPTO proceedings.
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`II.
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`ALL RELEVANT FACTORS FAVOR A STAY
`The parties agree that the Court should consider the following three factors in evaluating
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`Apple’s motion: “(1) whether discovery is complete and whether a trial date has been set;
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`(2) whether a stay will simplify the issues in question and trial of the case; and (3) whether a stay
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`would unduly prejudice or present a clear tactical disadvantage to the non-moving party.” ECF
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`No. 92 at 5; ECF No. 101 at 4. Each of these factors favors a stay.
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`A.
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`The First Factor Favors A Stay Because Discovery Is Far From Complete
`And A Trial Date Has Not Been Set.
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`OpenTV concedes that discovery is incomplete and no trial date has been set, but
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`nevertheless argues that the first factor weighs against a stay. ECF No. 101 at 3-7. OpenTV’s
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`arguments ignore the rationale behind this factor and are unsupported by the record.
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`Courts use the first factor to determine how much work remains in the case, and thereby
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`gauge the judicial efficiency that would result from a stay. See, e.g., PersonalWeb Technologies,
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`LLC v. Facebook, Inc., 2014 WL 116340, at *3 (N.D. Cal. Jan. 13, 2014) (granting a stay because
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`“a substantial portion of the work—expert discovery, summary judgment, pre-trial preparation,
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`and trial itself—lies ahead”); DSS Tech. Mgmt., Inc. v. Apple Inc., 2015 WL 1967878, at *2 (N.D.
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`Cal. May 1, 2015) (granting a stay because “significant work remains to be done”); eSoft, Inc. v.
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`Blue Coat Sys., 505 F. Supp. 2d 784, 788-89 (D. Colo. 2007) (granting a stay even when
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`“discovery is at or near completion” because “far more time and resources are yet to be devoted
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`to the case”). There is no dispute that a significant amount of work remains in this case before it
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`will be ready for trial, including the Court’s construction of the disputed claim terms; the
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`completion of fact discovery, expert reports, and depositions; dispositive motions; and pre-trial
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`motions. Ignoring the underlying goal of the first factor, OpenTV focuses its arguments on what
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`the parties have done without considering what remains ahead. See ECF No. 101 at 5-7.
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`Fact discovery in this case is far from complete. OpenTV has requested technical
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`documents for almost all of Apple’s existing products, including:
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`• Apple TV (2nd Gen., 3rd Gen., and 4th Gen.);
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`• Apple’s iOS Products (including iPhone, iPhone 3G, iPhone 3GS, iPhone 4, iPhone
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`4S, iPhone 5, iPhone 5S, iPhone 5C, iPhone 6, iPhone 6 Plus, iPhone 6S, iPhone 6S
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`Plus, iPod Touch 1st Generation, iPod Touch 2nd Generation, iPod Touch 3rd
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`Generation, iPod Touch 4th Generation, iPod Touch 5th Generation, iPod Touch 6th
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`Generation, iPad, iPad 2, iPad 3rd Generation, iPad 4th Generation, iPad Air, iPad Air
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`2, iPad mini, iPad mini 2, iPad mini 3, iPad mini 4, and iPad Pro); and
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`• Apple’s Mac OS Products (including iMac, Mac Pro, MacBook, MacBook Air,
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`MacBook Pro, and Mac Mini).
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`See Simmons Decl., Ex. 1 at Appendices A-E. In addition to document discovery, the parties
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`have yet to take a single deposition. If Apple’s motion is granted, the pending USPTO
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`proceedings have the potential to significantly narrow the scope of the remaining fact discovery
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`or eliminate it altogether.
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`OpenTV misleadingly argues that over 100,000 pages of documents have been produced
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`in this case. ECF No. 101 at 5. Those documents were not collected and produced specifically
`for this case, but were produced by Apple in another case between the parties.1 See id.; OpenTV
`I, 2015 U.S. Dist. LEXIS 143388, at *5. That prior case was stayed pending resolution of IPRs at
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`a more advanced stage of discovery compared to this case—Apple moved to stay OpenTV I after
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`producing a significant number of documents and source code, and after the Court already issued
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`a claim construction order. See id. Nevertheless, the OpenTV I court stayed the case because
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`“significant work remains to be done” and “a stay would conserve those significant resources
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`required to take the case to resolution.” Id. at *7-8.
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`Beyond fact discovery, a stay will also simplify expert discovery and dispositive motions
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`in this case. With three patents and dozens of accused products, expert discovery is expected to
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`be complex and expensive. Apple and OpenTV have already identified four technical experts for
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`the remaining patents-in-suit, and are expected to disclose additional experts. See ECF No. 74-1
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`(OpenTV identifying experts Almeroth and Rubin; Apple identifying experts Bradner and
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`Melvin). Moreover, both parties anticipate moving for summary judgment on a number of issues.
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`See ECF No. 57 at 4. Given the overlap between Apple’s invalidity defenses in this case and the
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`invalidity theories presented in Apple’s IPR and CBM petitions, staying this case pending
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`resolution of the IPRs and CBM would help the parties streamline expert reports and depositions.
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`OpenTV fails to cite a single case in which the Court found the first factor to weigh
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`against a stay when discovery is incomplete and a trial date has not been set. Instead, OpenTV
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`1 The parties agreed that the documents produced in OpenTV I may be used in this case.
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`relies on cases in which a trial had already been scheduled and fact discovery was close to
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`completion. See ECF No. 101 at 5-6. For example, the Court in Adaptix, Inc. v. HTC Corp.
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`found the first factor to weigh against a stay because the Court has conducted three rounds of
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`claim constructions, a trial date had been set, and “fact discovery [was] set to close in just over a
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`month.” No. 5:14-cv-02359-PSG, slip op. at 5 (N.D. Cal. Aug. 5, 2015); see also Verinata
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`Health, Inc. v. Ariosa Diagnostics, Inc., 2014 WL 121640, at *2 (N.D. Cal. Jan. 13, 2014) (first
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`factor weighs against a stay because “a trial date has been set” and “discovery is well underway”).
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`By comparison, this case is at an earlier stage of discovery because a trial date has not been
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`scheduled and fact discovery is far from completion. OpenTV’s cite to Affinity Labs of Texas v.
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`Apple Inc. is also misplaced because the Court in that case found that the “[first] factor weighs in
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`favor of a stay” but denied the motion on other grounds. 2010 U.S. Dist. LEXIS 50974, at *4
`(N.D. Cal. Apr. 29, 2010).2 None of the cases cited by OpenTV demonstrates that the first factor
`weighs against a stay of this case.
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`Courts have stayed cases at a more advanced stage of discovery than the current case.
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`See, e.g., OpenTV I, 2015 U.S. Dist. LEXIS 143388, at *5 (staying the case after the “Court
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`issued an order construing eight disputed claim terms” and “[t]he parties have produced over
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`100,000 pages of documents, including source code files”); Microsoft Corp. v. TiVo Inc., 2011
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`U.S. Dist. LEXIS 52619, at *16 (N.D. Cal. May 6, 2011) (“Many courts have stayed patent
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`infringement suits pending reexamination even after discovery was complete.”); eSoft, Inc., 505
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`F. Supp. 2d at 788-89 (staying case when “discovery [was] at or near completion” and dispositive
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`motion had already been filed); Motson v. Franklin Covey Co., 2005 U.S. Dist. LEXIS 34067, at
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`*4 (D.N.J. Dec. 16, 2005) (staying case even though “discovery is complete and summary
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`judgment has been decided”). At the current stage of the litigation, there can be no dispute that a
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`stay pending resolution of the IPRs and CBM will greatly advance judicial efficiency by
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`2 The Affinity Labs court denied Defendant’s motion to stay due to the potential risk of delay
`associated with the old reexamination procedure; it did not address the recently created IPR
`procedure. See Software Rights Archive, LLC v. Facebook, Inc., 2013 WL 5225522, at *3 (N.D.
`Cal. Sept. 17, 2013) (“This case is different than … Affinity Labs, first in that [Affinity Labs]
`involved the old reexamination proceedings, which presented a much greater risk of delay.”).
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`5
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`REPLY ISO MOTION TO STAY
`5:15-CV-02008-EJD
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`Case 5:15-cv-02008-EJD Document 103 Filed 05/24/16 Page 11 of 18
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`narrowing the issues in dispute. Therefore, the first factor favors a stay.
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`B.
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`The Second Factor Favors A Stay Because The USPTO Proceedings Will
`Simplify Issues For Trial.
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`Staying a district court case pending resolution of USPTO proceedings will “simplify the
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`case by rendering some or all of Plaintiff’s infringement claims moot, estopping [Defendant]
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`from asserting any arguments it raised or reasonably could have raised in the IPR[s], and
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`providing the Court with PTAB’s expert opinion on the claims at issue.” Sec. People, Inc. v.
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`Ojmar US, LLC, 2015 WL 3453780, at *3 (N.D. Cal. May 29, 2015) (citation omitted).
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`OpenTV’s arguments regarding the second factor fail for at least three reasons.
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`There Is A High Probability That Apple’s Petitions Will Be Granted
`1.
`First, OpenTV’s argument against a stay based on the fact that Apple’s IPR and CBM
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`petitions have not yet been granted fails. See ECF No. 101 at 7. OpenTV does not dispute that
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`the PTAB has instituted reviews on approximately 70 percent of all IPR petitions filed since 2014
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`and approximately 68 percent of CBM petitions. See ECF No. 92 at 7. OpenTV fails to identify
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`any valid reason why these statistics would be inapplicable to Apple.
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`Beyond the generalized statistics showing a high probability that the PTAB will institute
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`reviews, Apple has presented evidence that IPR institution is nearly certain for at least one of the
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`petitions in this case. See ECF No. 92 at 7-8. As OpenTV acknowledges, Netflix filed a prior
`petition, and IPR was instituted, for U.S. Patent No. 6,233,736. ECF No. 101 at 7-8. Apple’s
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`IPR petition for the same patent relies on the same prior art reference as the previously instituted
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`IPR. ECF No. 92 at 7-8. OpenTV misleadingly suggests that after “OpenTV filed a detailed
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`opposition” to Netflix’s IPR petition, “Netflix withdrew its petition.” ECF No. 101 at 7. There
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`was no causal relationship between OpenTV’s opposition and Netflix’s dismissal of its IPR.
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`Rather, Netflix dismissed its IPR within days after it reached a settlement agreement with
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`OpenTV. See OpenTV Inc. v. Netflix Inc., No. 14-cv-0525-RS, ECF No. 79 (N.D. Cal. Feb. 11,
`2015). OpenTV also fails to mention that the PTAB granted the IPR petition over OpenTV’s
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`opposition. OpenTV has not identified any reason why the PTAB will rule differently on Apple’s
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`petition.
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`6
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`REPLY ISO MOTION TO STAY
`5:15-CV-02008-EJD
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`Case 5:15-cv-02008-EJD Document 103 Filed 05/24/16 Page 12 of 18
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`Indeed, Apple’s track record of IPRs filed against OpenTV patents speaks for itself—
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`every petition for IPR that Apple has filed against OpenTV in OpenTV I has been instituted for
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`trial. See OpenTV I, 2015 U.S. Dist. LEXIS 143388, at *4-5. Thus, Apple’s petitions are far
`more likely to be granted than denied.3
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`This Case Will Be Simplified After Completion of PTAB Reviews
`2.
`Second, OpenTV relies on the misguided argument that this case can only be simplified if
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`every asserted claim is invalidated. The OpenTV I Court rejected this argument, explaining that
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`“[t]he standard is simplification of the district court case, not complete elimination of it by the
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`PTAB.” OpenTV I, at 2015 U.S. Dist. LEXIS 143388, at * 8 (citing LELO, Inc. v. Standard
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`Innovation (US) Corp., 2014 WL 2879851, at *3 (N.D. Cal. June 24, 2014)); see also
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`PersonalWeb Technologies, LLC v. Google Inc., 2014 WL 4100743, at *5 (N.D. Cal. Aug. 20,
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`2014). OpenTV does not dispute that 85% of final IPR decisions and 97% of final CBM
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`decisions upon completion of trial resulted in the cancellation of at least one reviewed claim. See
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`ECF No. 92 at 8. Thus, there is an overwhelming probability that some of the asserted claims
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`will be cancelled by the PTAB.
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`If any claim survives the PTAB trials, this case would still be narrowed as Apple will be
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`estopped from presenting invalidity defenses “on any ground that [Apple] raised or reasonably
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`could have raised during” the IPR (35 U.S.C. § 315(e)(2)) or “any ground that [Apple] raised
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`during” the CBM (AIA § 18(a)(1)(D)))). Thus, after completion of the IPR and CBM trials, this
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`Court would not need to address the issues already resolved by the PTAB and can focus its
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`resources on a narrower set of disputes.
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`OpenTV argues that the scope of discovery may be expanded after a stay if Apple
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`introduces new infringing products during the pendency of the stay. See ECF No. 101 at 7. The
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`OpenTV I Court already rejected this argument for being speculative and baseless, explaining:
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`“Aside from being speculative, this argument overlooks the fact that any ‘need’ to expand the
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`3 The USPTO is expected to issue its decisions regarding whether it will institute review of the
`patents-in-suit no later than November 9, 2016. OpenTV has not identified, and cannot identify,
`any prejudice it would suffer from staying this case until at least the institution decisions.
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`7
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`REPLY ISO MOTION TO STAY
`5:15-CV-02008-EJD
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`Case 5:15-cv-02008-EJD Document 103 Filed 05/24/16 Page 13 of 18
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`case would be fully controlled by Plaintiffs. And, based on Plaintiffs’ reasoning, expansion of the
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`case might be required even in the absence of a stay.” 2015 U.S. Dist. LEXIS 143388, at *9-10.
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`OpenTV also argues that because there are overlapping accused products between the
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`three remaining patents-in-suit, discovery across multiple classes of products would remain
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`necessary as long as some claims survive the USPTO proceedings. See ECF No. 101 at 9. The
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`scope of discovery sought by OpenTV weighs in favor, not against, a stay. If some claims are
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`cancelled while others are affirmed, discovery would be streamlined because the parties could
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`focus their efforts on a smaller set of features and products, rather than the entire catalog of Apple
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`products currently at issue. Given the complexity of this case, it is difficult to imagine a scenario
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`in which the dispute would not be narrowed by the completion of the IPRs and CBM.
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`OpenTV Misrepresents PTAB Statistics
`3.
`Third, OpenTV’s arguments should be rejected because they are premised on unfair
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`representations of USPTO statistics.
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`For example, OpenTV argues that there is a high probability this case will not be resolved
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`completely by the USPTO proceedings because, in completed IPR and CBM proceedings to date,
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`only a small percentage of cases result in the cancellation of all reviewed claims. See ECF No.
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`101 at 9 n.5; ECF No. 92-2 at 13-14. OpenTV omits the fact that 30.2% of all IPR proceedings—
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`868 of the 2,872—and 27.6% of all CBM proceedings—91 of the 330—ended by settlement
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`before the PTAB issued a formal decision. See ECF No. 92-2 at 10-12. Thus, the PTAB
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`statistics demonstrate that in over half of the cases—60.9% of completed IPRs and CBMs—the
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`parties’ disputes were resolved completely through either settlement or cancellation of all claims.
`See ECF No. 92-2 at 10-11.4 Even when the parties’ disputes are not completely resolved
`through PTAB review, those disputes are significantly narrowed. Only 131 of the 2,872
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`4 Despite OpenTV’s arguments to the contrary, the statistics regarding the PTAB’s finding all
`challenged claims unpatentable are staggering. For IPR proceedings, all challenged claims have
`been found to be unpatentable in 72% of final written decisions, 44% of petitions instituted but
`not continued through final written decisions, and 22% of all petitions filed. ECF No. 92; ECF
`92-2 at 10. For CBM proceedings, all challenged claims have been found to be unpatentable in
`79% of final written decisions, 49% of petitions instituted but not continued through final written
`decisions, and 26% of all petitions filed. ECF No. 92; ECF 92-2 at 11.
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`REPLY ISO MOTION TO STAY
`5:15-CV-02008-EJD
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`Case 5:15-cv-02008-EJD Document 103 Filed 05/24/16 Page 14 of 18
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`completed IPRs—a mere 5% of the total petitions—and 3 of the 330 completed CBMs—a mere
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`1% of total petitions—resulted in a final decision confirming the validity of all claims. See id.
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`And even in that extremely unlikely situation, the IPRs and CBM could still narrow the district
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`court case by addressing certain invalidity defenses.
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`It would be inefficient to require the parties to engage in parallel proceedings on the same
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`patents before the PTAB and this Court. The parties would need to conduct two phases of expert
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`discovery concerning the same claims, and the PTAB and this Court would need to independently
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`hold trials within months of each other to adjudicate the same patents. These parallel proceedings
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`would waste valuable judicial resources, and could lead to inconsistent decisions that may further
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`increase the complexity of this case. In contrast, a stay would promote judicial economy,
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`conserv