Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_15-cv-03754/USCOURTS-cand-4_15-cv-03754-12/pdf.json

Nature of Suit Code: 830
Nature of Suit: Patent
Cause of Action: 35:145 Patent Infringement

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UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

IXI MOBILE (R&D) LTD., et al.,

Plaintiffs,

v.

SAMSUNG ELECTRONICS CO LTD, et 

al.,

Defendants.

IXI MOBILE (R&D) LTD., et al.,

Plaintiffs,

v.

BLACKBERRY LIMITED, et al.,

 

 Defendants.

IXI MOBILE (R&D) LTD., et al.,

Plaintiffs,

v.

APPLE INC,

 

 Defendant.

Case No. 15-cv-03752-HSG 

ORDER GRANTING MOTION TO 

STAY

Re: Dkt. No. 119

Case No. 15-cv-03754-HSG 

Re: Dkt. No. 121

Case No. 15-cv-03755-HSG 

Re: Dkt. No. 106

Pending before the Court is Defendants’ joint motion to stay the case pending completion 

of inter partes review (“IPR”) proceedings. Dkt. No. 119 (“Mot.”).1 For the reasons articulated 

below, the motion is GRANTED.

 

1 All docket citations refer to the docket in IXI Mobile (R&D) Ltd. et al. v. Samsung Electronics 

Co. Ltd. et al., Case No. 15-cv-03752-HSG, unless otherwise indicated.

Case 4:15-cv-03754-HSG Document 136 Filed 11/12/15 Page 1 of 8
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I. BACKGROUND

A. America Invents Act

By enacting the Leahy-Smith America Invents Act (“AIA”), Congress sought to “establish 

a more efficient and streamlined patent system that will improve patent quality and limit 

unnecessary and counterproductive litigation costs” and “to create a timely, cost-effective 

alternative to litigation.” 77 Fed. Reg. 48,680-01 (Aug. 14, 2014) (to be codified at 37 C.F.R. 

§ 42.100 et seq). To that end, AIA created the IPR procedure, by which the Patent and Trademark 

Office’s (“PTO”) Patent Trial and Appeal Board (“PTAB”) may review the patentability of one or 

more claims in a patent. See 35 U.S.C. §§ 311-319. IPR replaces the previous inter partes

reexamination procedure and converts the process from an examinational to an adjudicative one. 

See Abbott Labs. v. Cordis Corp., 710 F.3d 1318, 1326 (Fed. Cir. 2013). 

IPR allows any party other than the patent owner to challenge a patent’s validity under 35 

U.S.C. § 102 or § 103 “on the basis of prior art consisting of patents or printed publications.” 35 

U.S.C. § 311(a)-(b). The petitioning party must establish “a reasonable likelihood that the 

petitioner would prevail with respect to at least [one] of the claims challenged in the petition” in 

order for the PTO to institute IPR. 35 U.S.C. § 314(a). If the PTO decides to institute IPR, the 

proceeding is conducted before a panel of three technically-trained Administrative Patent Judges 

of the PTAB. See 35 U.S.C. §§ 6(a)-(c), 316. Following a final determination, the petitioning 

party is estopped from asserting invalidity during a later civil action “on any ground that the 

petitioner raised or reasonably could have raised during” the IPR. 35 U.S.C. § 315(e)(2).

B. This Litigation

Plaintiffs IXI Mobile (R&D) Ltd. and IXI IP, LLC sued Defendants Samsung Electronics 

Co., Blackberry Limited, and Apple Inc. in the Southern District of New York on June 17, June 

18, and October 2, 2014, respectively. See Dkt. No. 1 (Samsung); Case No. 3:15-cv-03754-HSG, 

Dkt. No. 1 (BlackBerry); Case No. 3:15-cv-03755-HSG, Dkt. No. 1 (Apple).

On February 3, 2015, Defendants moved to transfer the cases to the Northern District of 

California. Dkt. No. 44. On August 6, 2015, Judge Sullivan granted the motion. Dkt. No. 79. 

The cases were related and reassigned to this Court on September 9, 2015. Dkt. Nos. 90, 94. An 

Case 4:15-cv-03754-HSG Document 136 Filed 11/12/15 Page 2 of 8
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initial case management conference occurred on November 5, 2015. Dkt. No. 130. 

Discovery is underway. Infringement and invalidity contentions have been served. Dkt. 

No. 124-1 ¶¶ 11-12. The parties have served and responded to written discovery and document 

requests. Id. ¶ 7. Plaintiffs have begun review of Defendants’ source code. Id. ¶ 14. The parties 

have served a series of third-party subpoenas. Id. ¶ 17. Defendants have deposed a third-party 

inventor and Plaintiffs’ claim construction expert. Id. ¶¶ 16, 22.

Claim construction has just begun. The parties filed a joint claim construction statement 

on June 8, 2015, and Plaintiffs filed an opening claim construction brief on July 8, 2015. Dkt. 

Nos. 68, 73.

On June 18 and 19, 2015, Defendants Apple and Samsung filed petitions for IPR 

challenging the validity of each asserted claim in all three patents at issue. Dkt. No. 119-1 ¶ 5. 

Defendant BlackBerry is not a party to the IPR petitions. An institution decision is expected from 

PTAB on or before January 2, 2016. Mot. at 3 (citing 35 U.S.C. § 316(a)(11)).

II. DISCUSSION

A. Legal Standard

“Courts have inherent power to manage their dockets and stay proceedings, including the 

authority to order a stay pending conclusion of a PTO reexamination.” Ethicon, Inc. v. Quigg, 849 

F.2d 1422, 1426-27 (Fed. Cir. 1988) (citations omitted). While courts are “under no obligation to 

stay proceedings pending parallel litigation in the PTAB, . . . judicial efficiency and the desire to 

avoid inconsistent results may, after a careful consideration of the relevant factors, counsel in 

favor of a limited stay, even before the PTAB has acted on a petition for IPR.” Delphix Corp. v. 

Actifio, Inc., No. 13-cv-04613-BLF, 2014 WL 6068407, at *2 (N.D. Cal. Nov. 13, 2014). Indeed, 

some courts in this district have recognized “a liberal policy in favor of granting motions to stay 

proceedings pending the outcome of USPTO reexamination or reissuance proceedings.” 

Pragmatus AV, LLC v. Facebook, Inc., No. 11-cv-02168-EJD, 2011 WL 4802958, at *2 (N.D. 

Cal. Oct. 11, 2011).

Courts consider three factors when determining whether to grant a stay pending IPR: “(1) 

whether discovery is complete and whether a trial date has been set; (2) whether a stay will 

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simplify the issues in question and trial of the case; and (3) whether a stay would unduly prejudice 

or present a clear tactical disadvantage to the non-moving party.” Evolutionary Intelligence, LLC 

v. Facebook, Inc., No. 13-cv-04202-SI, 2014 WL 261837, at *1 (N.D. Cal. Jan. 23, 2014). The 

moving party bears the burden of demonstrating that a stay is appropriate. Netlist, Inc. v. Smart 

Storage Sys., Inc., No. 13-cv-05889-YGR, 2014 WL 4145412, at *1 (N.D. Cal. Aug. 21, 2014).

B. Stage Of The Litigation

The first factor the Court considers is whether the litigation is at an early stage. See AT&T 

Intellectual Property I v. Tivo, Inc., 774 F. Supp. 2d 1049, 1052 (N.D. Cal. 2011). Specifically, 

courts consider “whether discovery is complete and whether a trial date has been set.” 

Evolutionary Intelligence, 2014 WL 261837, at *1.

Plaintiffs argue that “[t]hese cases are sufficiently advanced that a stay is not appropriate.” 

Dkt. No. 124 (“Opp.”) at 8. The Court does not doubt that the parties have already expended 

substantial resources on this litigation, but significant work remains to be done. No discovery, 

dispositive motions, pretrial, or trial deadlines have been set. Claim construction briefing, though 

underway, is not complete, and there is no claim construction or tutorial hearing set. Moreover, 

the cases were only recently transferred to this Court. In similar circumstances, courts have found 

that this factor weighs in favor of a stay. See Cypress Semiconductor Corp. v. LG Elecs., Inc., No. 

13-cv-04034-SBA, 2014 WL 5477795, at *2 (N.D. Cal. Oct. 29, 2014) (finding that this factor 

weighs in favor of a stay where claim construction briefing was complete but “[t]here has been no 

dispositive motion practice, the claims have not been construed, and no deadlines for completing 

discovery, motion practice or trial have been set”); DSS Tech. Mgmt., Inc. v. Apple Inc., No. 14-

cv-05330-HSG, 2015 WL 1967878, at *2-3 (N.D. Cal. May 1, 2015) (finding that this factor 

weighs in favor of a stay where claim construction briefing was complete, substantial discovery 

had been produced, and depositions had begun but fact discovery was not scheduled to close for 

another six months, expert discovery had not begun, and no trial date had been set).

The Court finds that this factor weighs in favor of a stay.

C. Simplification of the Case

The second factor that the Court considers is whether granting a stay could simplify the 

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litigation. “The standard is simplification of the district court case, not complete elimination of it 

by the PTAB.” LELO, Inc. v. Standard Innovation (US) Corp., No. 13-cv-01393-JD, 2014 WL 

2879851, at *3 (N.D. Cal. June 24, 2014). Granting a stay pending IPR is “particularly” likely to 

simplify the case “when a party has obtained PTO review of each of the asserted claims in the 

patents-in-suit.” Evolutionary Intelligence, 2014 WL 261837, at *2. 

Staying the case pending the outcome of IPR could simplify the case by rendering some or 

all of Plaintiffs’ infringement claims moot, estopping Defendants from asserting any arguments 

they raised or reasonably could have raised in the IPR, and providing the Court with PTAB’s 

expert opinion on the claims at issue. See Evolutionary Intelligence, 2014 WL 261837, at *2. 

Indeed, even if the PTAB decides to institute review and affirms the validity of every asserted 

claim, the case would still be simplified because “such a strong showing would assist in 

streamlining the presentation of evidence and benefit the trier of fact by providing the expert 

opinion of the PTO.” PersonalWeb Techs., LLC v. Facebook, Inc., No. 13-cv-01356-EJD, 2014 

WL 116340, at *4 (N.D. Cal. Jan. 13, 2014).

Because Defendant BlackBerry is not a party to the IPR petitions, it is not bound by the 

estoppel rules set out in the statute. However, “[t]he court may alleviate any estoppel concern as 

to [BlackBerry] by using its inherent power to condition a stay on [BlackBerry’s] agreement to be 

bound as if [it] had filed the relevant IPR petition.” Id. at *6. At the November 5, 2015 hearing, 

BlackBerry agreed on the record to accept this condition.

Plaintiffs argue that “[t]here is a growing consensus to deny stay requests” where, as here, 

the PTO has not yet decided whether to institute the requested IPR proceedings. Opp. at 6. The 

Court disagrees. See DSS Tech. Mgmt., Inc., 2015 WL 1967878, at *3 (finding this factor weighed

in favor of a stay even though institution decision not expected for another two months); Sec.

People, Inc. v. Ojmar US, LLC, No. 14-cv-04968-HSG, 2015 WL 3453780 (N.D. Cal. May 29, 

2015) (finding this factor weighed in favor of a stay even though institution decision not expected 

for another two months); OpenTV, Inc. v. Apple Inc., Case No. 3:14-cv-01622-HSG, Dkt. No. 217 

(N.D. Cal. Oct. 21, 2015) (granting stay even though institution decision not expected for another 

month); Pragmatus AV, 2011 WL 4802958, at *3 (“[I]t is not uncommon for [courts] to grant 

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stays pending reexamination prior to the PTO deciding to reexamine the patent.”). Furthermore, 

either party may file a motion to lift the stay if any part of the petitions for IPR are denied by the 

PTO—so “any concern that the motion[] [is] premature is alleviated by the short time frame of the 

initial stay and the Court’s willingness to reevaluate the stay if inter partes review is not instituted 

for all of the asserted claims.” Evolutionary Intelligence, 2014 WL 261837, at *3. Here, the case 

would be stayed for less than two months until the PTO is expected to decide whether to institute 

IPR proceedings. 

The Court finds that this factor weighs in favor of granting a stay conditioned on 

Blackberry’s agreement to be bound as if it were a party to the IPR petitions. If instituted, IPR is 

likely to simplify the case. Moreover, a six-week delay before the PTO’s decision whether to 

institute IPR on all of the asserted patents is minimal. See PersonalWeb Techs., 2014 WL 116340, 

at *4 (finding that four-month delay before PTO’s institution decision would issue was “relatively 

short” and did not outweigh anticipated simplification of issues); Delphix, 2014 WL 6068407, at 

*2 (“At a minimum, instituting a brief, limited stay of approximately five months to see whether 

and how the PTAB will act on Defendant’s IPR petitions will conserve judicial resources and 

avoid inconsistent results.”).

D. Undue Prejudice

The third factor for the Court to consider is whether Plaintiffs will be unduly prejudiced by 

a stay. Plaintiffs argue that they will be unduly prejudiced because “the timing [of the filing of the 

IPR petitions] suggests a dilatory motive.” Opp. at 10.

The Court declines to read a dilatory motive into Defendants’ timely exercise of their

statutory rights, standing alone. See Software Rights Archive, LLC v. Facebook, Inc., No. 12-cv03970-RMW, 2013 WL 5225522, at *6 (N.D. Cal. Sept. 17, 2013) (“Although defendants did wait 

nearly a year to file the IPR petitions, they properly filed the petitions within the statutory time 

frame, and the delay was not unreasonable under the facts here.”); Cypress Semiconductor, 2014 

WL 5477795, at *3 (finding that the fact that defendant filed its IPR petitions close to the end of 

the statutory deadline “does not demonstrate undue delay”); Evolutionary Intelligence, LLC v. 

Sprint Nextel Corp., No. 13-cv-04513-RMW, 2014 WL 819277, at *4 (N.D. Cal. Feb. 28, 2014) 

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(“[T]he IPR petitioners filed the petitions properly within the statutory time frame. Under these 

facts, this delay was not unreasonable, and [plaintiff] does not point to any tangible undue 

prejudice resulting from the IPR petitioners exercising their statutory rights.”); Delphix, 2014 WL 

6068407, at *3 (“[W]hile the Court does not condone gamesmanship, it will not require a patent 

infringement defendant to file a petition for inter partes review significantly earlier than the time 

allowed by statute.”). 

Furthermore, courts have consistently found that where, as here, the parties are not direct

competitors, Plaintiffs “do[] not risk irreparable harm by [Defendant’s] continued use of the 

accused technology and can be fully restored to the status quo ante with monetary relief.” 

Software Rights Archive, 2013 WL 5225522, at *6; see also Adaptix v. HTC Corp., No. 14-cv02359-PSG, slip op. at 6 (N.D. Cal. Aug. 5, 2015) (“[C]ourts decline to find undue prejudice 

where the parties are not direct competitors and where any resulting prejudice can be addressed 

through a final damages award.”).

Finally, Plaintiffs argue that a stay would “risk undermining [the] preparation of [their]

case.” Opp. at 11. But the only example Plaintiffs give of such interference is the general 

statement that they have “preservation concerns” regarding documents subpoenaed from third 

parties. Id. Plaintiffs do not give any specific reason to worry about document preservation 

issues, nor do they explain how a stay would prejudice any other aspect of their case preparation. 

As a result, the Court finds that no risk of undue prejudice exists. 

Because a stay will not cause undue prejudice to Plaintiffs, the Court finds that this factor 

weighs in favor of granting the stay.

* * *

After weighing the three factors outlined above, the Court finds that a stay is warranted 

here and will “effectuate[] the intent of the AIA by allowing the agency with expertise to have the 

first crack at cancelling any claims that should not have issued in the patents-in-suit before costly 

litigation continues.” Software Rights Archive, 2013 WL 5225522, at *6. 

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III. CONCLUSION

For the foregoing reasons, the Court GRANTS Defendants’ motion to stay the case 

pending decision by the PTO whether to institute IPR of the claims asserted in all of Defendants’

petitions. Per its agreement on the record at the November 5 hearing, Defendant BlackBerry is

subject to the same scope of estoppel that applies to IPR practitioners under 35 U.S.C. § 315(e). 

The parties shall file a joint status report within five days of the issuance of the PTO’s decision(s)

on whether to institute IPR challenging the patents-in-suit, informing the Court of the PTO’s 

decision. After the PTO has made a decision on all of Defendants’ petitions, the Court will issue 

an order addressing further proceedings in the case.

IT IS SO ORDERED.

Dated: November 12, 2015

______________________________________

HAYWOOD S. GILLIAM, JR.

United States District Judge

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