Advancing Inter Partes Reexaminations Cited to CAFC
When faced with the assertion of a patent of dubious validity, prospective defendants increasingly resort to patent patent reexamination. Once a suit is filed, the opportunity to obtain a stay of an ongoing district court infringement action pending a parallel patent reexamination is a major benefit of the USPTO proceeding. Courts have the inherent power to manage their dockets, including the authority to stay patent infringement litigation pending the conclusion of a USPTO patent reexamination. A stay of the court proceeding enables defendants to halt, or altogether avoid cost prohibitive litigation discovery, which can be rather lengthy and painful.
For this reason, patent reexamination parallel to a district court is often initiated in an attempt to stay the more cost prohibitive court proceeding. In deciding whether or not to stay the court proceeding the courts look to many factors. (See factor based analysis here)
If the Court proceeding is not stayed, both proceeding will proceed on parallel tracks. Should the Court proceeding continue on to the CAFC, can you try to persuade the appellate court to stay the proceeding pending the outcome of the reexamination?
This situation was considered by the CAFC yesterday in Synqor Inc., v. Artesyn Technologies Inc., et al. At issue in the appeal are five patents relating to power converter circuitry. While the suit has been pending, inter partes patent reexaminations were initiated by the defendants at the USPTO. While the court upheld the validity of the patents, to date, the reexaminations proceedings have been quite unfavorable to the Patent Holder.
In considering whether or not to stay the appeal, the CAFC explained:
The power of the Court to stay proceedings is incidental to its inherent power to control the disposition of the cases on its docket. See Landis v. North Am. Co., 299 U.S. 248, 254 (1936). Here, we cannot say the appellants have shown that staying proceedings for such a lengthy period of time is warranted. [Defendants] reliance on this court’s decision in Standard Havens Prpds., Inc. v. Gencor Indus., 996 F.2d 1236 (Fed. Cir. 1993) to support a contrary conclusion is unpersuasive.
This court in Standard Havens directed the district court to stay its damages proceedings until the PTO reexamination proceeding became final. In that case, the PTO’s proceedings were complete and the decision of the BPAI was on appeal before another district court. Here, however, the court is being asked to stay proceedings at the relative end of the litigation process pending a lengthy administrative process that even the appellants predict will take at least 10-14 months to complete. Under these circumstances, we deem it appropriate to deny the motions to stay.
Going forward, with the accelerated schedule of Inter Partes Review & Post Grant Review (12-18 months in total), the ability to stay court procedings pending USPTO proceedings is likely to be greatly enhanced.