Tactical Advantage Found in IPR Timing

The primary business distinctions between the USPTO Patent Trial & Appeal Board (PTAB) proceedings and traditional court based patent invalidity proceedings are the vast improvements in cost, predictability, effectiveness, and speed of PTAB proceedings— to date, the speed has been changing the perspective of the judiciary on staying litigation pending USPTO proceedings. However, while the PTAB proceedings are far faster than the previous inter partes USPTO option (i.e., inter partes patent reexamination) that doesn’t mean that courts will look past a perceived tactical delay in pursuing IPR.

As a reminder, factors generally considered by district court judges when ruling on motions to stay include whether (1) a stay will unduly prejudice, or present a clear tactical disadvantage to, the non-moving party; (2) a stay will simplify the issues and trial of the case; and (3) discovery is complete and a trial date has been set.

By design, IPR filings must be made within 12 months of service of a complaint, which is typically early in most litigation dockets. As such, the above stay analysis is typically quite favorable for IPR filers. Yet, in faster paced districts, it is important to file as soon as possible if a stay is desired. This fact was recently made clear in Universal Electronics Inc. v. Universal Remote Control Inc. (CDCA) where the court explained (here):

To the extent Defendant sought a tactical advantage, it appears to have been to obtain the Court’s claim construction before filing its inter partes review petitions, perhaps to see if they were necessary, as Defendant did not petition for review of the ‘367 Patent, which the Court’s claim construction removed from consideration in this case. That strategy negatively impacted the likelihood that this motion would be granted . .

(emphasis added)

While generally speaking IPR filings are being viewed more favorably by the courts relative to the slower reexamination predecessor, it is clear that speed of the USPTO may be overlooked where the petitioner has introduced delay.

Finally, the Court expressed an interesting perspective as to parallel USPTO proceedings, noting:

The Court is concerned that allowing the progress of its docket to depend on the status of proceedings elsewhere can interfere with its obligation “to secure the just, speedy, and inexpensive determination of every action.” Fed. R. Civ. P. 1. “If litigation were stayed every time a claim in suit undergoes reexamination, federal infringement actions would be dogged by fits and starts. Federal court calendars should not be hijacked in this manner.” Comcast Cable Commc’ns Corp., LLC v. Finisar Corp., No. C 06-04206 WHA, 2007 WL 1052883, at *1 (N.D. Cal. Apr. 5, 2007).

Here the court quotes an older case relating to slower patent reexamination proceedings. While some courts may object to the “hijacking” of their dockets in the early stage of a litigation (discovery has not yet begun in Universal), they may find this hijacking far more distasteful when the PTAB issues a final written decision holding claims unpatentable before the court can get to trial— which will be the case in most districts where an IPR is allowed to proceed in parallel.

This case was brought to my attention by the great Docket Navigator.