Undoing a Stay Pending Patent Reexamination?…UnlikelyWhere an order has been granted to stay a patent litigation pending the outcome of a reexamination of the patent-in-suit, there is little likelihood that patent owner will be able to successfully appeal the decision ordering the stay of litigation. Such orders are generally not appealable, because they are not considered final decisions.  See Gould v. Control Laser Corp., 705 F.2d 1340 (Fed. Cir. 1983). There is an exception where the stay “effectively could put one of the appellants out of court” or if some “patent issue would escape review by a federal court if the case is stayed.”  See Slip Track Sys., Inc. v. Metal-Lite, Inc., 159 F.3d 1337, 1340 (Fed. Cir. 1998).Federal courts have often found jurisdiction to review stays in favor of state court suits when the state court judgment would have a fully preclusive effect on the federal action or moot the federal action entirely.  See , e.g. , Cone , 460 U.S. at 10; Terra Nova Ins. Co. v. 900 Bar, Inc. , 887 F.2d 1213, 1218-21 (3d Cir. 1989). Stays in favor of administrative proceedings are similarly reviewed on an “effectively out of court” standard. See Gould , 705 F.2d at 1341; Hines v. D’Artois , 531 F.2d 726, 730-32 (5th Cir. 1976).It is difficult to identify many circumstances in which an “effectively out of court” situation would be presented for substantive issues based on concurrent reexamination. Of course, that doesn’t stop desperate plaintiffs from attempting this “Hail Mary Pass” of legal maneuvers.U.S. Patent 4,935,184, assigned to Sorenson Research & Development is at issue in Sorenson v. Lexar Media (NDCA). The ‘184 Patent is also the subject of an ongoing ex parte patent reexamination. The reexamination proceeding has reached the appeal stage; all claims stand currently rejected. With their court action stayed for some two years time awaiting the results of the patent reexamination, the plaintiff argued that two year delay was a violation of due process. This argument was then pursued to the CAFC. The CAFC considered the issue last week (here). As no surprise, the Hail Mary attempt failed. The CAFC explained, consistent with the well established case law cited above, that:Perhaps Sorenson should have been a bit more creative than opting for the Hail Mary. As one recent NDCA plaintiff can attest, the “end-around” is much more successful in lifting a stay pending patent reexamination in the NDCA.

Where an order has been granted to stay a patent litigation pending the outcome of a reexamination of the patent-in-suit, there is little likelihood that patent owner will be able to successfully appeal the decision ordering the stay of litigation. Such orders are generally not appealable, because they are not considered final decisions.  See Gould v. Control Laser Corp., 705 F.2d 1340 (Fed. Cir. 1983). There is an exception where the stay “effectively could put one of the appellants out of court” or if some “patent issue would escape review by a federal court if the case is stayed.”  See Slip Track Sys., Inc. v. Metal-Lite, Inc., 159 F.3d 1337, 1340 (Fed. Cir. 1998).

Federal courts have often found jurisdiction to review stays in favor of state court suits when the state court judgment would have a fully preclusive effect on the federal action or moot the federal action entirely.  See , e.g. , Cone , 460 U.S. at 10; Terra Nova Ins. Co. v. 900 Bar, Inc. , 887 F.2d 1213, 1218-21 (3d Cir. 1989). Stays in favor of administrative proceedings are similarly reviewed on an “effectively out of court” standard. See Gould , 705 F.2d at 1341; Hines v. D’Artois , 531 F.2d 726, 730-32 (5th Cir. 1976).

It is difficult to identify many circumstances in which an “effectively out of court” situation would be presented for substantive issues based on concurrent reexamination. Of course, that doesn’t stop desperate plaintiffs from attempting this “Hail Mary Pass” of legal maneuvers.

U.S. Patent 4,935,184, assigned to Sorenson Research & Development is at issue in Sorenson v. Lexar Media (NDCA). The ‘184 Patent is also the subject of an ongoing ex parte patent reexamination. The reexamination proceeding has reached the appeal stage; all claims stand currently rejected. With their court action stayed for some two years time awaiting the results of the patent reexamination, the plaintiff argued that two year delay was a violation of due process. This argument was then pursued to the CAFC. 

The CAFC considered the issue last week (here). As no surprise, the Hail Mary attempt failed. The CAFC explained, consistent with the well established case law cited above, that:

sorenson

Perhaps Sorenson should have been a bit more creative than opting for the Hail Mary. As one recent NDCA plaintiff can attest, the “end-around” is much more successful in lifting a stay pending patent reexamination in the NDCA.