Issue: Emergency Motion to Stay Injunction Pending Appeal
Judge: Magistrate Judge Cathy Ann Bencivengo
Order: Denied
Date: June 25, 2010

Mytee’s motion for a Stay of Injunction Pending Appeal was denied.

On January 20, 2010, following a jury verdict in favor of Harris Research, Inc. finding asserted claims of Harris’ U.S. Patent Nos. 6,298,577 and 6,266,892 infringed and not invalid, the Court granted Harris’ request for a permanent injunction under 35 U.S.C. § 283 against Mytee Products, Inc. On February 16, 2010, Mytee filed an appeal with the U.S. Court of Appeals for the Federal Circuit. On April 12, 2010, Mytee filed a motion for a stay of the injunction pending the appeal and Harris filed an opposition.

A court may stay an injunction pending appeal pursuant to Federal Rule of Civil Procedure 62(c). The Court considered four factors in ruling on Mytee’s Rule 62(c) motion: (1) whether the stay applicant has made a strong showing that he is likely to succeed on the merits; (2) whether the applicant will be irreparably injured absent a stay; (3) whether issuance of the stay will substantially injure the other parties interested in the proceeding; and (4) where the public interest lies.

Notably, in its motion for Stay of Injunction Pending Appeal, Mytee informed the Court that in January, 2010 the USPTO  granted its ex parte and inter partes requests for reexamination of the two Harris patents at issue in the litigation. See 90/010,690 and  95/001,235.

The Court found that: “The likelihood of success on an appeal from the judgment in this case is not increased by a reexamination proceeding before the USPTO that involves different prior art. The USPTO may ultimately find the Harris patents invalid but that proceeding is not part of the issues on appeal before the Federal Circuit …  The allowance of a reexamination does not create a strong likelihood of success on the merits of the appeal from the judgment in this case. Mytee must appeal from the record in this case, and the reexamination proceeding is considering art that was not before this Court.” Order, p. 3.

Ultimately the Court found that Mytee had not made a strong showing that it is likely to succeed on the appeal given the absence in the record of evidence presented by Mytee as part of the summary judgment proceedings. The Court found that Mytee had not demonstrated that it would be irreparably injured absent a stay. The Court rejected Mytee’s contention that Harris would be not irreparably harmed by continued sales of the infringing product because the parties are not direct competitors and money damages would be adequate to compensate Harris for any ongoing sales pending the appeal. Finally, the Court found that Mytee had not demonstrated that the public interest clearly lies in favor of a stay.

Download or Read Complete Order (PDF): Emergency Motion to Stay Injunction and or Execution of Judgment; 2010-06-25; Denied; Magistrate Judge Cathy Ann Bencivengo; Mytee Products Inc v. Harris Research, Inc (3-06-cv-01854) CASD

Spectrum further urged that despite the pending reexaminations, Sorensen proceeded to initiate not only the present lawsuit but numerous others, at least 23 of which had been granted stays pending reexamination of the ‘184 patent, in many cases by the present Court. Spectrum also suggested that the statutory mandate of “special dispatch” had been compromised by Sorensen’s petitioning for (and receipt of) multiple extensions of time to respond to each Office Action.

Ultimately, the Court concluded that a stay was appropriate because the litigation was in its early stages, Sorensen had not established undue prejudice, and the reexamination would simplify issues for the Court and save expense for the parties. Moreover, plaintiff could move to vacate if the reexamination did not take a “reasonable” amount of time. The Court further provided that any party could apply for an exception to the stay for “specific, valid” reasons believed to require discovery in order to preserve evidence that would otherwise be unavailable after the stay.

Read the Order: Motion for Stay Pending Reexamination; 2009-12-23; Granted; District Judge Barry Ted Moskowitz; Sorensen v. Spectrum Brands, Inc. et al (3-09-cv-00058) CASD

The Court was evidently not persuaded by Sorensen’s 23 page opposition to the motion, which began: “An ex parte reexamination of a patent is like a baseball game with an undetermined number of innings …[t]his Court cannot predict the final outcome of the ‘184 patent reexamination and it can no longer wait for the game to end.”

The case is Sorensen v. Spectrum Brands, Inc. et al, case number 6-09-cv-00116, in the United States District Court of the Southern District of California. Reexaminations 90/008,976 filed on December 21,2007 and 90/008,775 filed on July 30, 2007.

Read the Court Order: Motion for Stay Pending Reexamination; 2009-11-13; Granted; District Judge Barry Ted Moskowitz; Sorensen v. Target Brands, Inc. et al (3-09-cv-00056) CASD

The Court was succinct and issued an order one half page in duration.  The Court concluded that a stay was appropriate because: (1) the litigation is still in its early stages, (2) plaintiff had not established undue prejudice, and (3) the reexamination will simplify issues for the Court and save expense for both parties. It was noted that the USPTO “recently rejected all of the reexamined claims” on August 8, 2009 in both proceedings, providing further support for granting the stay. Judge Moskowitz indicated, however, that if the reexamination will not be completed “within a reasonable time” the plaintiff may move to vacate the stay. Of note, amendments to the claims in response to the office action referenced by the Court were submitted October 21, 2009 by plaintiff’s reexamination counsel following an in person interview with the Examiner conducted in March.

The case is Sorensen v. Target Brands, Inc. et al, case number 3-09-cv-00056, in the United States District Court of in the Southern District of California.

Read the full motion here: Court Grants Motion In Limine to Exclude from Trial Evidence Relating to Pending Reexamination

In Presidio, the USPTO granted Defendant American Technical Ceramics’ (ATC) replacement request for reexamination of the patent-at-issue on October 20, 2009.  ATC intended to offer specific determinations and findings made by the USPTO in its order granting the reexamination as evidence at trial, although it did not intend to argue that the patent-at-issue was invalid because of the grant of reexamination.  ATC argued that the specific USPTO findings it sought to introduce as evidence “are directly relevant and highly probative of specific issues underlying ATC’s inequitable conduct and invalidity defenses.”  These include: (1) “non-cumulativeness of the reexamination references in the prior art in the original prosecution” and (2) “importance of their consideration to a reasonable examiner, i.e., their materiality to patentability.”

Plaintiff Presidio moved to exclude from trial evidence relating to that reexamination on the ground that it was unfairly prejudicial and not relevant to the lawsuit, citing Hoechst Celanese Corp. v. BP Chemicals Ltd., 78 F.3d 1575, 1584 (Fed. Cir. 1996) (”the grant by the examiner of a request for reexamination is not probative of unpatentability.”)

The court distinguished between pending reexaminations and concluded reexaminations, suggesting that concluded reexaminations may have probative value, citing Molins PLC v. Textron, Inc., 48 F.3d 1172, 1179 (Fed. Cir. 1995) (”the result of a USPTO proceeding that assesses patentability in light of information not originally disclosed can be of strong probative value in determining whether the undisclosed information was material.”) (emphasis added).   In this case, however, since the reexamination had only just been granted by the PTO, the court did not view the grant as having much probative value.  The court also relied on the USPTO’s 2007 ex parte reexamination statistics, stating “although it appears that the USPTO grants about 92% of the requests for reexamination, in only 12% of cases does that reexamination result in all claims being cancelled.”   It is unclear why the court relied on 2007 statistics, rather than the current PTO statistics.  Although the statistics are similar in this instance, the reliance on old data has the potential for decisions to be based on faulty premises.  That statistic led the court to conclude, “[t]here is thus a ’substantial likelihood’ that, despite the grant of reexamination, the USPTO will uphold the patentability of some or all of Presidio’s claims.’”  Despite ATC’s stated intention to use the USPTO’s determinations and findings for limited purposes, the court still excluded any reference of the reexamination from trial.

Balancing the relevant factors (e.g., stage of the litigation, simplification of the issues, undue prejudice to nonmoving party) the Court exercised its discretion to impose a stay on the grounds that despite the complaint being filed over one year ago, the case remained at a relatively early stage (e.g., the parties had not yet filed their joint chart or opening briefs, no trial date had been set, no dispositive motion practice was underway), which weighed in favor of a stay with the stipulation that discovery would be ongoing as to the ‘949 Patent.  Second, the Court found that the stay would simplify the issues in question and ultimately the trial of the case insofar as the USPTO initially rejected all 38 claims of the ‘949 Patent. Moreover, since the reexamination was inter partes, the Court seemed persuaded that matters would be simplified insofar as a USPTO decision would be binding on the parties and the record would serve as evidence during claim construction. Finally, examining the final factor as to whether or not a stay would unduly prejudice or present a clear tactical disadvantage to the nonmoving party, the Court cited a 2008 order which stated: “Delay inherent in the reexamination process does not constitute, by itself, undue prejudice.” Furthermore, the Court did not find evidence that either party would suffer unduly since they had already agreed to phased litigation, which would proceed as planned with respect to at least three of the other patents. Read the Court’s Order Granting the Stay: Motion for Stay Pending Reexamination; 2009-11-05; Granted; District Judge Michael M. Anello; Medtronic Sofamor Danek USA, Inc et al v. Nuvasive, Inc. (3-08-cv-01512) CASD

The case is Medtronic Sofamor Danek USA, Inc et al v. Nuvasive, Inc., case number 3-08-cv-01512, in the United States District Court of the Southern District of California.