Concurrent Proceedings

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Delay in Case Schedule Allows for Amended Complaint  Previously, Voda v. Medtronic Inc., et. al. (OKWD) examined the impact of multiple requests for patent reexaminationin the context of a motion to stay. Early in the case the defendant Medtronic was able to secure a stay pending a first request for patent reexamination. Shortly thereafter, the

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Additional Prosecution History Proves CrucialA successful reexamination from a defendant perspective does not always result in an overt claim change or cancellation. In other words, even where claims are confirmed, statements in the reexamination record that are inconsistent with arguments made in a concurrent litigation, or that rise to the level of an outright disclaimer, may provide new, non-infringement positions to defendants.This week, the CAFC relied upon statements made by a Patentee in the patent reexamination of U.S. Patent 5,355,964 to affirm claim construction findings of the EDVA and NDCA.In American Piledriving Equipment Inc., v. Geoquip, (CAFC 2011), the court explained:The prosecution history removes all doubt that one of ordinary skill in the art would have understood the term “integral” to mean “formed or cast of one piece.” During reexamination, American Piledriving attempted to distinguish a prior art reference by arguing this very point . . . American Piledriving nevertheless argues that it did not clearly and unmistakably disavow the construction of “integral” it urges on appeal. It points out that it did not amend its claims and made multiple arguments to overcome the asserted prior art reference. American Piledriving contends that the statement was unnecessary to overcome the reference and that the examiner explicitly disagreed with it. “[W]e have made clear . . . [that] an applicant’s argument that a prior art reference is distinguishable on a particular ground can serve as a disclaimer of claim scope even if the applicant distinguishes the reference on other grounds as well.” Andersen Corp. v. Fiber Composites, LLC, 474 F.3d 1361, 1374 (Fed. Cir. 2007). Moreover, regardless of whether the examiner agreed with American Piledriving’s arguments concerning “integral,” its statements still inform the proper construction of the term. See Seachange Int’l, Inc. v. C-Cor Inc., 413 F.3d 1361, 1374 (Fed. Cir. 2005) (“An applicant’s argument made during prosecution may lead to a disavowal of claim scope even if the Examiner did not rely on the argument.”); Microsoft Corp. v. Multi-Tech Sys., 357 F.3d 1340, 1350 (Fed. Cir. 2004) (“We have stated on numerous occasions that a patentee’s statements during prosecution, whether relied on by the examiner or not, are relevant to claim interpretation.”). American Piledriving unambiguously argued that “integral” meant “one-piece” during reexamination and cannot attempt to distance itself from the disavowal of broader claim scope. (emphasis added)The above result bears out a very important application of patent reexamination concurrent with litigation, namely, the creation of additional fodder for claim construction purposes.Clearly, a successful patent reexamination from a defendant perspective does not necessarily require that a Patentee cancel or amend claims. As such, when facing a suit in a district court in which a Markman Hearing is scheduled some 12-18 months in the future, initiation of patent reexamination at the outset may prove an effective strategy to focus the later deba

A successful reexamination from a defendant perspective does not always result in an overt claim change or cancellation. In other words, even where claims are confirmed, statements in the reexamination record that are inconsistent with arguments made in a concurrent litigation, or that rise to the level of an outright disclaimer, may provide new, non-infringement positions to defendants.

This week, the CAFC relied upon statements made by a Patentee in the patent reexamination of U.S. Patent 5,355,964 to affirm claim construction findings of the EDVA and NDCA.
Continue Reading Patent Reexamination Exposes Double Talk

42% of 2007 Cases Remain StayedPatent reexamination parallel to a district court/ITC litigation is often initiated in an attempt to stay the more cost prohibitive court proceeding. Court’s will stay the ongoing litigation pending the patent reexamination outcome in the interests of judicial economy.But, what happens to these cases? Are they ultimately dismissed altogether? Do the majority of these cases resume? Do the answers to these questions vary based upon the type of patent reexamination request?In 2007, 81 cases were stayed pending patent reexamination. Looking at the status of these cases today, long term results demonstrate a significant advantage for defendants. As shown in the chart below, the combined results of 2007 cases stayed for both ex parte and inter partes reexamination requests is illustrated. (click to enlarge)As shown above, only 35% of cases were reopened after the initial stay. This indicates that as much as 65% of stays yield a favorable result for the defendant (i.e., remain stayed/dismissed). While it is possible that some cases were dismissed upon favorable settlement to the defendant, such does not appear to be the case.In those cases involving only ex parte patent reexamination (below) 46% of cases are reopened (a negative result for defendants), with 54% of cases ending favorably to a defendant.(Click to enlarge)Interestingly, those defendants seeking inter partes patent reexamination fared much better than those seeking ex parte patent reexamination.In those cases involving only inter partes patent reexamination, or both inter partes reexamination and ex parte reexamination, (below) only 18% of cases have been reopened, with a staggering 50% of cases still stayed. Adding together the 32% of cases that have been dismissed, indicates up to an 82% favorable result for such defendants.A common complaint of Patentees facing a motion to stay pending inter partes patent reexamination is that granting of such a motion effectively suspends the case for years on end. In view of the 2007 results, it seems likely that argument will proliferate as defendants embrace inter partes filings in increasingly greater numbe

Patent reexamination parallel to a district court/ITC litigation is often initiated in an attempt to stay the more cost prohibitive court proceeding. Court’s will stay the ongoing litigation pending the patent reexamination outcome in the interests of judicial economy.

But, what happens to these cases? Are they ultimately dismissed altogether? Do the majority of these cases resume? Do the answers to these questions vary based upon the type of patent reexamination request?

In 2007, 81 cases were stayed pending patent reexamination. Looking at the status of these cases today, long term results demonstrate a significant advantage for defendants. …
Continue Reading What Happens After A Case is Stayed Pending Patent Reexamination?

Patent Enforceability Key Factor In Patent Reexamination Eligibility, Not ExpirationIn patent reexamination strategy, especially concurrent to litigation, timing is everything.1. Timing of the original patent application dictates eligibility for inter partes patent reexamination. (i.e., on or after November 29, 1999)2. Timing of a concurrent court proceeding may also control decision making. Inter partes patent reexamination is not a viable option relative to an advanced court proceedings. (See Sony v. Dudas)3. Timing of the patent reexamination request, even the type of reexamination (i.e., ex parte or inter partes) will also greatly impact the ability to stay a parallel proceeding pending patent reexamination.But what about expired patents? Recently, the court in APP Pharmaceuticals, LLC v. Ameridose (DNJ) denied the defendants motion to stay, in part, as one of the three patents in-suit (4,870,086) was not undergoing patent reexamination. The court emphasized that the ‘086 patent (which was expired) was not subject to patent reexamination, thus the litigation would continue at some point no matter what happened at the USPTO.The decision, found here, also noted some other factors tending to favor continuation of the litigation independent of the patent expiration issue. Unfortunately for Ameridose, typically, seeking a stay where some patents are not subject to patent reexamination is a non-starter; as it was here.The record does not specifically reflect the reason why the defendant did not pursue patent reexamination of the expired patent. However, it seems that Ameridose viewed the expired patent as less likely to weigh in favor of plaintiff prejudice (should a stay be entered) since there are no damages going forward.But, let’s take a look at the patent expiration issue.Of course, it is perfectly appropriate for a patent to be reexamined after expiration. In fact, the USPTO provides a separate claim interpretation standard for such cases. Unlike reissue applications, which cannot be pursued after expiration, patent reexamination is based upon the enforceability of the patent. The period of enforceability is determined by adding 6 years to the date of patent expiration. 37 C.F.R. § 1.510(a)Looking only at the filing date, the ‘086 patent would seemed to have expired on November 24, 2006. However, this patent’s term was extended, due to the regulatory review delay of the Food & Drug Administration. The extended expiration date of the ‘086 patent is September 24, 2010. Thus, the ‘086 patent remains enforceable (for past damage purposes) until September 24, 2016.Surely, had patent reexamination been pursued, relief would not have been possible by operation of intervening rights. This is because an expired patent may not be amended. Still, the patent could have been invalidated by patent reexamination, and the odds of staying the case would have been greatly improved.This case was brought to my attention by the great Docket Navigator.

In patent reexamination strategy, especially concurrent to litigation, timing is everything.

1. Timing of the original patent application dictates eligibility for inter partes patent reexamination. (i.e., on or after November 29, 1999)

2. Timing of a concurrent court proceeding may also control decision making. Inter partes patent reexamination is not a viable option relative to an advanced court proceedings. (See Sony v. Dudas)

3. Timing of the patent reexamination request, even the type of reexamination (i.e., ex parte or inter partes) will also greatly impact the ability to stay a parallel proceeding pending patent reexamination.

But what about expired patents? 

Recently, the court in APP Pharmaceuticals, LLC v. Ameridose (DNJ) denied the defendants motion to stay, in part, as one of the three patents in-suit (4,870,086) was not undergoing patent reexamination. The court emphasized that the ‘086 patent (which was expired) was not subject to patent reexamination,…

Continue Reading Patent Reexamination & Expired Patents

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.
Continue Reading Can You Appeal A Decision to Stay Your Case?

Courts Struggle with Realities of Post Grant PracticeA standard component of any patent litigation is a protective order. Such orders will invariably include a “prosecution bar. ” The prosecution bar operates to ensure that individuals accessing such confidential data are not permitted to prosecute patent applications in the area of the litigated technology (usually for a fixed duration of time). Absent this bar, patent applications/claims could be fashioned by competitive decision makers involved in the litigation based on the confidential information of their rival.With concurrent patent reexamination now commonplace with most patent litigation, the question becomes:Should a prosecution bar extend to patent reexamination?  The answer to that question has varied across district courts, and even across judges of the same court. Those courts permitting participation in patent reexamination would benefit from a reading of the record in University of Virginia Patent Foundation v. General Electric Company. In an earlier post on this topic, I noted the decision of one Delaware judge in Xerox Corp. v. Google, Inc. et al. In Xerox. In this case, as in many such cases, the inability to broaden claims in patent reexamination was found to guard against an improper use of confidential materials; as such, the litigation team was permitted to participate in the patent reexamination.Last week, in the same Delaware court, a different judge came to the opposite conclusion in Edwards Lifesciences AG, et. al. v. Corevalve Inc. (DE, Wilmington). In the Order (here) the judge concluded that the risk of use/disclosure of confidential materials justified a prosecution bar forbidding litigation team participation in the patent reexamination.Of course, different cases will have different facts and considerations. Rather than developing bright line rules, or looking at patent reexamination in the abstract, courts may find that the complexity of the technology/claim interpretation is an important factor in assessing possible competitive misues of confidential information.As I have pointed out previously in discussing this issue, one of the purposes of filing a patent reexamination is to force an amendment to an issued claim that will result in non-infringement. Likewise, the creation of additional estoppel/disclaimer is also a significant benefit to the parellel proceeding. In especially complex technologies, knowledge of the infringing devices can be absolutely critical in the prosecution of a patent reexamination.  But, you don’t have to take my word for it, let’s look at what happened in University of Virginia Patent Foundation v. General Electric Company. (Last year’s post here on intervening right issues)In Virginia, the typical dispute played out with respect to the protective order. The Patentee argued that the prosecution bar was unnecessary since claims can only be broadened. On the other hand, G.E. argued that the plaintiff’s attorneys had been exposed through discovery to the confidential operation of the “crown jewels” of G.E.’s products. G.E. argued that the litigators could effectively “gerrymander” the claims in the direction of infringement,while simultaneously avoiding the prior art, by “whispering in the ear” of the prosecutor; nevertheless, the judge allowed participation in the reexamination.So, what happened in the patent reexamination? Not surprisingly, no amendments were made (see earlier post linked above on claim cancellation/intervening rights issue). More importantly, and completely within their rights, Virginia applied a considerable amount of finesse with respect to the characterization of claim terminology in the patent reexamination.  In a March 2010 filing, after the proceeding was favorably terminated, the Patentee submitted additional comments. The comments were directed to the examiner’s Statement for confirming the claims and terminating the proceeding.The Patent Owner believes that claim 1 is patentable over Frahm I for at least the reasons given in the “Amendment Under 37 C.F.R. § 1.111 and § 1.550… ” filed November 30,2009, hereafter, “the previous response.” Those reasons did not require the claimed “magnetization recovery period” to be viewed in the manner described in the Statement. The Patent Owner believes that the scope of claim 1 of the ‘282 patent includes embodiments wherein the claimed “magnetization recovery period” allows either substantially complete or partial Tl and T2 relaxation to occur, depending upon the chosen duration of the “magnetization recovery period” and the Tl and T2 relaxation times of the tissue being imaged. (See, e.g., the embodiments in columns 17 and 18 where none of the “magnetization recovery periods” are long enough to allow substantially complete Tl and T2 relaxation to occur.) The Patent Owner further believes that this is clearly supported by the examples in the ‘282 patent, and the manner in which an artisan would interpret the glossary terms in the ‘282 patent related to this feature. Specifically, the use of preselected “magnetization recovery periods” in these examples that permit only partial Tl and T2 relaxation demonstrates how the recovery period can be manipulated to provide “an additional degree of freedom for controlling the image contrast ….” See, ‘282 patent, column 15, lines 10-14.  . . Although unlikely, it may be that the specific relaxation timing of G.E.’s devices is public knowledge. Still, it is apparent from this filing how fairly precise information can be infused to the prosecution history of a patent reexamination. This type of filing arguably demonstrates the very “gerrymandering” and self serving type of statement argued by GE to the judge (transcript 9/2/2009), to no avail.At least for cases relating to complex technologies, prosecution bars that prevent direct participation in patent reexamination would appear advisable.The Edwards Lifesciences case was brought to my attention by the great Docket Navigator.

A standard component of any patent litigation is a protective order. Such orders will invariably include a “prosecution bar. ” The prosecution bar operates to ensure that individuals accessing such confidential data are not permitted to prosecute patent applications in the area of the litigated technology (usually for a fixed duration of time). Absent this bar, patent applications/claims could be fashioned by competitive decision makers involved in the litigation based on the confidential information of their rival.

With concurrent patent reexamination now commonplace with most patent litigation, the question becomes:

Should a prosecution bar extend to patent reexamination?  

The answer to that question has varied across district courts, and even across judges of the same court. Those courts permitting participation in patent reexamination would benefit from a reading of the record in University of Virginia Patent Foundation v. General Electric Company. …
Continue Reading Should a Protective Order Bar Participation in Patent Reexamination?

Court Lists Practical Efficiencies of Patent Reexamination

In attempting to stave off a motion to a district court litigation pending patent reexamination, the opposing party (almost always the Patentee) will often characterize a parallel patent reexamination as an “all or nothing proposition.” That is to say, in the face of the argument that the patent reexamination is likely to simplify issues for trial (almost always a defendant argument), the opponent will insist that USPTO statistics demonstrate that it is very unlikely that all claims will be canceled.

In Genzyme Corp., v Cobrek Pharmaceuticals Inc., (NDIL, Order 2/17/11), the relatively rare case of a Patentee requested stay was at issue. In deciding to stay the district court proceeding based on the familiar factor based analysis, the court found that simplification of issues was likely. In doing so, the court created a list of discovery efficiencies, potential cost savings, and case management benefits to be gained from awaiting the outcome of the USPTO action.
Continue Reading Cost Benefits of Concurrent Patent Reexamination

terms-of-disservice

Infamous Katz Portfolio Withers Under Pressure of Patent Reexamination

USPTO empirical data is quite helpful for determining the frequency by which claims are amended, cancelled, or confirmed in patent reexamination. Yet, when it comes to the overall efficacy of patent reexamination, USPTO statistics only tell part of the story.

A successful reexamination from an infringer’s perspective does not always result in an overt claim change or cancellation. In other words, even where claims are confirmed, statements in the reexamination record that are inconsistent with arguments made in a concurrent litigation, or that rise to the level of an outright disclaimer may provide new, non-infringement positions to defendants. Likewise, such statements may limit the Patentee’s ability to distinguish the prior art.

In the ongoing patent reexaminations of the Katz portfolio, there have been significant victories for challengers. However, as made clear by the CAFC last week (In re Katz Interactive Call Processing Patent Litigation) not every victory shows up in USPTO statistics as cancelled/amended claims.
Continue Reading Patent Reexamination Statements Hamper Katz Portfolio

Is a Preliminary Injunction Ever Proper Parallel to Patent Reexamination?Over the past week I have discussed the interplay between a parallel patent reexamination and requests for a preliminary injunction. On Monday I pointed out that if a request for injunctive relief remains outstanding courts are very reluctant to stay an ongoing litigation pending a parallel patent reexamination. Last week I explained that a defendant’s ability to argue prejudice, to fend off a stay pending patent reexamination, may very well hinge on the pursuit of a preliminary injunction. Left to explore this week is the impact of the parallel reexamination on the preliminary injunction equities ultimately weighed by the court.To date, a parallel patent reexamination has been the “silver bullet” for defeating requests for such preliminary injunctive relief. Yet, as one defendant found out recently, perceived gamesmanship in patent reexamination tactics may re-direct that very same bullet to one’s foot.In the case of Celsis In Vitro Inc., v. CellzDirect Inc., & Invitrogen Corp. (N.D. IL), the court agreed to enter an injunction. In doing so, the court rejected certain invalidity evidence presented by the defendant for purposes of demonstrating that the plaintiff was unlikely to succeed on the merits. Upon losing their argument, the defendant filed a request for inter partes patent reexamination. The request included much more art than was presented to the court.Around the same time, the plaintiff beat the defendant to the punch by using the same art in their own ex parte request. The ex parte patent reexamination request was granted. In view of the same or cumulative art before the USPTO in the ex parte request, the defendant’s inter partes request was denied shortly thereafter. By employing  this “first to file” strategy, the plaintiff effectively shut out the defendant from participating in the patent reexamination. (See first to file strategy discussion here)Nevertheless, once a first office action was issued in the ex parte patent reexamination, the defendant sought dissolution/modification of the injunction. The defendant argued that a preliminary injunction has never been maintained in view of a parallel patent reexamination that rejected claims. Yet, this otherwise compelling argument was offset by the perceived bad faith in the defendant’s actions. The court questioned the defendant on the issue as follows:THE COURT:Good morning. I would be remiss, I think, if I didn’t comment that I find defendant’s actions here very troubling. You know, if your — I know you are a newcomer here for this purpose. But if your people wanted to have reexamination of plaintiffs’ ‘929 patent, why wasn’t that done before our hearing and the entry of the preliminary injunction order? That I believe casts a serious cloud on the good faith of the defendants and defense counsel.What is conspicuously absent from this motion to stay is even a whisper of an explanation for doing battle before me, occupying a great deal of time and effort on my part, as well as the part of the litigants, and then when you have lost, tendering the issue of patent validity to the Patent & Trademark Office.And it is not just a matter of lack of consideration for an imposition on what is really — although lawyers don’t think about this a lot — the most limited resource in the justice system, that is, the judge’s time. So before you started to lecture me about something I was well aware, that is, the power to stay and the need for the exercise of discretion, it seems to me I am entitled to an explanation. (Plaintiff’s motion in Opposition to Dissolve or Modify Preliminary Injunction, January 4, 2011)Thereafter, the court did agree to modify the injunction as to certain products already in existence for purposes of inventory liquidation. (order here) However, the court refused to modify the injunction for prospective sales and the manufacture of new product. In other words, based upon the court’s inference of bad faith, the very first defendant was preliminarily enjoined in view of a parallel patent reexamination that rejected asserted claims. (Discussion on permanent injunction equities and parallel patent reexamination here)It may be that the new art in the defendant’s request was more of a response to the “use it or lose it” estoppel provision of inter partes patent reexamination (as opposed to a lack of bad faith). Still, delaying the filing of a patent reexamination parallel to patent litigation rarely makes sense.This case was brought to my attention by the great Docket Navigator.

Over the past week I have discussed the interplay between a parallel patent reexamination and requests for a preliminary injunction. On Monday I pointed out that if a request for injunctive relief remains outstanding courts are very reluctant to stay an ongoing litigation pending a parallel patent reexamination. Last week I explained that a defendant’s ability to argue prejudice, to fend off a stay pending patent reexamination, may very well hinge on the pursuit of a preliminary injunction. Left to explore this week is the impact of the parallel reexamination on the preliminary injunction equities ultimately weighed by the court.

To date, a parallel patent reexamination has been the “silver bullet” for defeating requests for such preliminary injunctive relief. Yet, as one defendant found out recently, perceived gamesmanship in patent reexamination tactics may re-direct that very same bullet to one’s foot.
Continue Reading Undermining a Preliminary Injunction Via Patent Reexamination

Setting the Stage for a Showing of PrejudiceObtaining a stay of an ongoing district court infringement action is one of the many benefits of patent reexamination concurrent with litigation. Defendants that are able to obtain a stay pending patent reexamination can avoid cost prohibitive litigation discovery during the course of the USPTO proceeding. In addition to cost savings, there are also tactical advantages to the USPTO proceeding. Unlike the courts, in patent reexamination, the USPTO does not recognize the presumption of validity. Moreover, the USPTO does not require the “clear and convincing” standard to demonstrate invalidity in patent reexamination, but employs the more liberal “preponderance of the evidence” standard. As such, defendants can enhance the strength of their invalidity defense via patent reexamination. As defendants increasingly employ patent reexamination as a litigation tool, patent owners must adapt their game plan.Patent Owners often select patent friendly forums for their perceived reluctance to invalidate U.S. Patents, such as the Eastern District of Texas. Such forums are oft times equally reluctant to stay an ongoing infringement action in favor of a patent reexamination proceeding. However, for those Patent Owners forced into less friendlier fora, what steps can be taken to avoid a stay pending patent reexamination?One of the factors generally considered when ruling on a  motion to stay is whether or not the stay will unduly prejudice, or present a clear tactical disadvantage to, the non-moving party. In the case of direct competitors, court’s will often give greater weight to the potential business prejudice in delaying the court action. Therefore, to emphasize this potential for prejudice, and to anticipate the need to demonstrate such, it is imperative that Patent Owners move for a preliminary injunction.In weighing the relative merits of staying an ongoing court action between competitors, the Patent Owners request for injunctive relief is given significant weight. As recently discussed in Osmose, Inc. v. Arch Chemicals, Inc., et al., 2-10-cv-00108 (VAED, Norfolk) (previous post here)Although Osmose has not filed a motion for a preliminary injunction, the complaint does seek injunctive relief. Osmose therefore might be prejudiced by a multi-year stay that could allow defendants to both continue selling the allegedly infringing products and further increase their market share.   Further, last week it was emphasized that the timing of the request for injunctive relief may also impact the relative equities of staying the case. In Richtek Technology Corp., et al., v. uPI Semiconductor Corp. et. al., 3-09-cv-05659 (NDCA), the court emphasized that:Richtek has not filed a motion for a preliminary injunction in this year-and-change-old district court action. Although Richtek expressed intent to eventually file a preliminary injunction motion at the October 2010 case management conference and in its early January discovery dispute letter brief, it did not even request permission to file such a motion until nearly a week after motion practice was suspended in mid-January (Dkt. Nos. 108 at 14, 229 at 2, 242). If the threat of irreparable harm truly were imminent, then Richtekwould not have dragged its feet this long. Richtek has not shown that it would suffer irreparable harm or clear tactical disadvantage as a result of a stay of this action.For Patent Owners anticipating a motion to stay pending patent reexamination, an early motion for preliminary injunction can go a long way in demonstrating potential prejudice relative to a direct competit

Obtaining a stay of an ongoing district court infringement action is one of the many benefits of patent reexamination concurrent with litigation. Defendants that are able to obtain a stay pending patent reexamination can avoid cost prohibitive litigation discovery during the course of the USPTO proceeding. 

In addition to cost savings, there are also tactical advantages to the USPTO proceeding. Unlike the courts, in patent reexamination, the USPTO does not recognize the presumption of validity. Moreover, the USPTO does not require the “clear and convincing” standard to demonstrate invalidity in patent reexamination, but employs the more liberal “preponderance of the evidence” standard. As such, defendants can enhance the strength of their invalidity defense via patent reexamination. 

As defendants increasingly employ patent reexamination as a litigation tool, patent owners must adapt their game plan.
Continue Reading Avoiding a Stay Pending Patent Reexamination