Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_04-cv-02000/USCOURTS-cand-4_04-cv-02000-100/pdf.json

Nature of Suit Code: 830
Nature of Suit: Patent
Cause of Action: 28:1331 Fed. Question

---

United States District Court

For the Northern District of California

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

O2 MICRO INTERNATIONAL LIMITED, a

Cayman Islands corporation,

Plaintiff,

v.

MONOLITHIC POWER SYSTEMS, INC., a

California corporation, et al.,

Defendants.

 /

AND RELATED CASES, CROSS-CLAIMS AND

COUNTERCLAIMS.

 /

No. C 04-2000 CW 

No. C 06-2929 CW

ORDER DENYING

DEFENDANTS' MOTION

FOR PARTIAL

JUDGMENT AND

SETTING SCHEDULE ON

REMAINING ISSUES

Monolithic Power Systems, Inc. (MPS) and ASUSTeK Computer,

Inc. move for entry of partial judgment on their claim for

declaratory relief that the asserted claims of O2 Micro

International Limited's U.S. Patent No. 6,396,722 (the '722 patent)

are invalid. O2 Micro opposes the motion. The matter was decided 

on the papers. Having considered all of the parties' papers, the

Court denies the motion for partial judgment.

Case 4:04-cv-02000-CW Document 1068 Filed 07/16/07 Page 1 of 7
United States District Court

For the Northern District of California

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

2

BACKGROUND

On May 15, 2007, the jury in the above entitled consolidated

actions returned a verdict. The jury found that MPS and ASUSTeK

infringed claims 12 and 14 of the '722 patent, but it further found

those claims and claims 1, 2, 9 and 18 of the '722 patent were

invalid for obviousness and under the on-sale bar. Other issues,

however, remain that must still be tried to the Court: (1) MPS's

and ASUSTeK's affirmative defense of inequitable conduct with

respect to the '722 patent; (2) their request for an "exceptional

case" determination and attorneys' fees under 35 U.S.C. § 285;

(3) MPS's unfair competition claim against O2 Micro for the

assertion of U.S. Patent No. 6,259,615 (the '615 patent); and

(4) O2 Micro's unfair competition claim against MPS for the

granting of stock options to customers.

Currently pending before the Federal Circuit is another case

involving the '722 patent and the same claims that are at issue in

this case: O2 Micro International Ltd. v. Taiwan Sumida

Electronics. The appeal is fully briefed. Following the verdict

in this case, Sumida moved to postpone the oral argument scheduled

on July 9, 2007 and submission of the appeal in light of the jury's

finding of invalidity. The Federal Circuit granted Sumida's

request and has deferred oral argument and ordered Sumida to

provide a status report every thirty days.

A second case involving the '722 patent is O2 Micro

International Ltd. v. Hon Hai Precision Industry Co., pending in

the United States District Court for the Eastern District of Texas. 

There, O2 Micro accuses MPS's customer Hon Hai of infringing the

Case 4:04-cv-02000-CW Document 1068 Filed 07/16/07 Page 2 of 7
United States District Court

For the Northern District of California

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

3

same claims that O2 Micro asserted against MPS and ASUSTeK in this

case and various claims of two other O2 Micro patents. The trial

was scheduled to begin on July 18, 2007; however, the parties have

jointly moved to continue the trial until September, 2007.

DISCUSSION

 Federal Rule of Civil Procedure 54(b) provides:

When more than one claim for relief is presented in an action,

whether as a claim, counterclaim, cross-claim, or third-party

claim, or when multiple parties are involved, the court may

direct the entry of final judgment as to one or more but fewer

than all of the claims or parties only upon an express

determination that there is no just reason for delay and upon

an express direction for the entry of judgment.

In Curtiss-Wright Corp. v. General Elec. Co., 446 U.S. 1

(1980), the Supreme Court articulated a two step test for

determining when there is no just reason for delay. First, the

court must determine if the judgment is a final judgment. 

Curtiss-Wright, 446 U.S. at 7. A judgment is not final for Rule

54(b) purposes unless it is “an ultimate disposition of an

individual claim entered in the course of a multiple claims

action.” Sears, Roebuck & Co. v. Mackey, 351 U.S. 427, 436 (1956).

Second, the court must determine whether there is any just reason

for delay. Curtiss-Wright, 446 U.S. at 8. 

The Federal Circuit explains that "courts have substantial

discretion in determining when there is no just cause for delay in

entering judgment under Rule 54(b).” Intergraph Corp. v. Intel 

Corp., 253 F.3d 695, 699 (Fed. Cir. 2001) (citing Cold Metal 

Process Co. v. United Engineering & Foundry Co., 351 U.S. 445, 452

Case 4:04-cv-02000-CW Document 1068 Filed 07/16/07 Page 3 of 7
United States District Court

For the Northern District of California

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

1

The parties dispute whether Ninth Circuit law or Federal

Circuit law governs. The Federal Circuit has applied the law of

the regional circuit to determine whether a district court's entry

was final relative to all pending issues. See Golan v. Pingel

Enterprise, Inc., 310 F.3d 1360, 1366 (Fed. Cir. 2002). But it has

also stated that it applies Federal Circuit law "instead of

regional circuit law to issues involving Rule 54(b) certification." 

Storage Technology Corp. v. Cisco Systems, Inc., 329 F.3d 823, 830

(Fed. Cir. 2003). Because the outcome of this case does not depend

on whether Ninth Circuit or Federal Circuit law is applied, the

Court need not determine which law governs.

4

(1956)).1 This discretion, however, should be exercised "in the

interest of sound judicial administration." Sears, Roebuck, 351

U.S. at 437. Thus, in determining whether there is no just cause

for delay in judgment, courts "must take into account judicial

administrative interests as well as the equities involved." 

Curtiss-Wright, 446 U.S. at 9. Factors courts consider include

"whether the claims under review were separable from the others

remaining to be adjudicated and whether the nature of the claims

already determined was such that no appellate court would have to

decide the same issues more than once even if there were subsequent

appeals." Id. at 8.

The parties do not dispute that there is a final judgment for

purposes of Rule 54(b); rather they dispute whether there is just

reason for delay. MPS and ASUSTeK contend that there is not. They

argue that entering partial judgment that the asserted claims of

the '722 patent are invalid would greatly reduce the needless

expenditure of attorneys' fees and judicial resources in the two

related cases involving the '722 patent. As O2 Micro points out,

however, the briefing in the Taiwan Sumida appeal is complete and

Case 4:04-cv-02000-CW Document 1068 Filed 07/16/07 Page 4 of 7
United States District Court

For the Northern District of California

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

5

the Federal Circuit has effectively stayed any further action

pending the final outcome of this case; thus, granting a partial

judgment of invalidity now as opposed to later will not result in

any great savings of resources. The Hon Hai case involves more

than just the '722 patent. While granting partial judgment of

invalidity now, before that case goes to trial, would result in

some saving of judicial resources and attorneys' fees, that amount

is not as great as MPS and ASUSTeK contend. 

Further, there is overlap between MPS's and ASUSTeK's

invalidity and inequitable conduct defenses, a factor which weighs

against granting partial judgment. Contrary to MPS's and ASUSTeK's

arguments, judicial economy and fundamental fairness do not support

immediate entry of a partial final judgment of invalidity. The

Court finds that the more efficient course of action is to wait

until all issues relating to the '722 patent have been adjudicated

before entering final judgment and denies MPS's and ASUSTeK's

motion. 

CONCLUSION

For the foregoing reasons, MPS's and ASUSTeK's Motion for

Entry of Partial Judgment of Invalidity Under Federal Rule of Civil

Procedure 54(b) (Docket No. 1051) is DENIED. Nonetheless, in the

interest of expediency and to accommodate the courts which may be

waiting for this Court's rulings in this case, the Court shall

enter a briefing schedule for the parties' post-judgment papers

that will allow the Court to rule on these motions promptly after

judgment is entered. MPS's and ASUSTEK's renewed JMOL and new

trial motions must be filed by July 27, 2007. O2 Micro's

Case 4:04-cv-02000-CW Document 1068 Filed 07/16/07 Page 5 of 7
United States District Court

For the Northern District of California

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

6

opposition and any cross-motions will be due on August 10, 2007. 

MPS's and ASUSTEK's reply and opposition will be due on August 17,

2007 and O2 Micro's sur-reply will be due on August 24, 2007. 

These motions will be decided on the papers, unless the Court sets

a hearing. Any post-judgment motions on the remaining bench trial

issues shall also be briefed in an expedited fashion. 

The Court sets the following schedule on the remaining issues: 

The inequitable conduct bench trial will be held on Friday,

August 3, 2007 at 9:00 a.m. However, if MPS and ASUSTeK intend to

use deposition testimony from Dr. Yung-Lin Lin and Ed Pfleger, and

not live testimony, they must inform the Court by July 20, 2007 and

the bench trial date will be vacated. If there is no live

testimony, their motion for a finding of inequitable conduct must

be filed by July 23, 2007. O2 Micro may submit its opposition and

cross-motion with respect to MPS's and ASUSTeK's inequitable

conduct defense on August 6, 2007. MPS's and ASUSTeK's reply will

be due on August 13, 2007 and O2 Micro's sur-reply will be due on

August 20, 2007. The matter will be decided on the papers, unless

the Court sets it for a hearing. If there is live testimony from

Dr. Yung-Lin Lin and Ed Pfleger, MPS's and ASUSTeK's motion for a

finding of inequitable conduct must be filed one week after the

bench trial. O2 Micro's opposition and cross-motion will be due

the following week. MPS's and ASUSTeK's reply will be due the week

after and O2 Micro's sur-reply will be due the following week. 

MPS's unfair competition claim will be presented on the

papers, unless O2 Micro objects to the admissibility of certain

patent infringement complaints and patent infringement contentions

Case 4:04-cv-02000-CW Document 1068 Filed 07/16/07 Page 6 of 7
United States District Court

For the Northern District of California

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

7

filed in other cases involving the '615 patent. If there is no

objection or the Court can take judicial notice of these documents,

MPS's trial brief will be due on July 23, 2007. O2 Micro may

submit its opposition on August 6, 2007. MPS's reply will be due

on August 13, 2007. If there is a dispute and MPS must call O2

Micro's counsel to testify concerning the admissibility of the

complaints and contentions, O2 Micro's counsel shall testify on

Friday, August 3, 2007 at 9:00 a.m. trailing the inequitable

conduct trial. MPS's trial brief must be filed one week after the

bench trial. O2 Micro's opposition will be due the following week

and MPS's reply will be due the week after. 

A bench trial on O2 Micro's unfair competition claim shall be

held on Friday, August 3, 2007 at 9:00 a.m. trailing the

inequitable conduct trial and, if necessary, on Tuesday, August 7,

2007 at 8:30 a.m. 

Motions for the recovery of fees and costs shall be filed ten

court days after all JMOL and new trial motions have been decided.

IT IS SO ORDERED.

Dated: 7/16/07 

CLAUDIA WILKEN

United States District Judge

Case 4:04-cv-02000-CW Document 1068 Filed 07/16/07 Page 7 of 7