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UNITED STATES DISTRICT COURT 

EASTERN DISTRICT OF MICHIGAN 

SOUTHERN DIVISION 

SIGNAL IP, INC., 

 Plaintiff, 

 Case No. 14-cv-13864 

v. 

 HON. MARK A. GOLDSMITH 

FIAT U.S.A., INC., et al, 

 

 Defendants. 

_________________________________/ 

OPINION AND ORDER 

DENYING DEFENDANTS FORD MOTOR COMPANY’S AND FCA US LLC’S JOINT 

MOTION TO STAY ALL PROCEEDINGS PENDING REEXAMINATION AND INTER 

PARTES REVIEW (Dkt. 20) 

I. INTRODUCTION 

In this patent infringement case, Plaintiff Signal IP, Inc. (“Signal”) alleges that 

Defendants Ford Motor Company (“Ford”) and Fiat Chrysler US LLC (“FCA”) (collectively 

“Defendants” or “Ford and FCA”) have infringed upon six of its patents. This matter is before 

the Court on Defendants’ joint motion to stay all proceedings pending reexamination and inter 

parties review (Dkt. 20).1 Because oral argument will not aid the Court, the motion will be 

decided based on the parties’ briefing. See E.D. Mich. L.R. 7.1(f)(2). 

For the reasons stated below, the Court denies Defendants’ joint motion to stay this case. 

The parties shall contact the Court’s Special Master Christopher G. Darrow to discuss a proposed 

schedule for this case. The parties shall use the Court’s Model Rule 26(f) Report and Proposed 

Scheduling Order as a guide in negotiating a schedule that is appropriate for this case. 

 

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 In the related case of Signal IP, Inc. v. Ford Motor Company, No. 14-13729 (Goldsmith, J.), 

Defendant Ford filed a substantially similar motion to stay (Dkt. 13). To avoid duplicative 

citations when citing to the record in this joint motion, the Court in this opinion and order will 

cite to briefs and exhibits in Signal IP, Inc. v. Ford Motor Company, No. 14-13729. 

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II. BACKGROUND 

In early 2014, Signal filed a series of patent-infringement cases in the United States 

District Court for the Central District of California against various automobile manufacturers, 

including the present cases against Ford and FCA. In the cases against Ford and FCA, Signal 

asserted six patents against Ford2

 and five patents against FCA.3 The patents relate to several 

different technologies. 

After an initial scheduling conference, on September 25, 2014, the California district 

court issued an order granting Ford’s motion to transfer the case against Ford to the United States 

District Court for the Eastern District of Michigan (Dkt. 13-4). Shortly thereafter, on October 6, 

2014, the California district court granted FCA’s motion to transfer the case against Chrysler to 

the United States District Court for this Eastern District of Michigan (Dkt. 13-5). The cases were 

initially assigned to Judges O’Meara and Tarnow, but they were reassigned to this Court in 

January 2015. At the time the cases were transferred, the cases were in their infancy with only 

Rule 26(a)(1) initial disclosures having been exchanged. 

After the cases against Ford and FCA were transferred to the Eastern District of Michigan, 

several automobile manufacturers filed proceedings at the United States Patent and Trademark 

Office (“USPTO”) to invalidate the asserted claims of the patents. Currently, all of the asserted 

patents and claims are subject to a patentability review by the USPTO. The below table 

summarizes the proceedings filed at the USPTO. 

 

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 Those patents include: (1) U.S. Patent No. 6,012,007; (2) U.S. Patent No. 5,732,375; (3) U.S. 

Patent No. 5,714,927; (4) U.S. Patent No. 6,434,486; (5) U.S. Patent No. 6,775,601; and (6) U.S. 

Patent No. 5,463,374. See Joint Discovery Plan at 6 (Dkt. 12). 

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 The same patents, other than the ‘601 Patent, are asserted against FCA. 

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Asserted Patent 

No. 

Challenged 

Claims Proceeding No. Filer Filing Date 

6,775,601 

1-17 IPR2015-00860 Ford March 13, 2015 

1-4, 6-11, 13-17 IPR2015-00861 Ford March 13, 2015 

8-11, 13, 15, 17 IPR2015-00941 MBUSA March 25, 2015 

1-17 IPR2015-01002 Honda April 3, 2015 

8-11, 13, 15, 17 Reexamination 

Control No. 

90/013,385 

Volkswagen and 

Bentley 

October 27, 2014 

6,434,486 

21, 23, 26, 27-

28, 30, 34-35 

IPR2015-00890 MBUSA March 16, 2015 

1, 6-8, 13-14, 21, 

26-28, 33-34 

IPR2015-01005 Honda April 3, 2015 

21, 26, 28 Reexamination 

Control No. 

90/013,384 

Volkswagen and 

Bentley 

October 27, 2014 

21, 26-28, 34 IPR2015-01110 Porsche April 24, 2015 

5,714,927 1-2, 6 IPR2015-00968 Volkswagen March 30, 2015 

5,732,375 1, 7 IPR2015-01003 Honda April 3, 2015 

1, 7 Reexamination 

Control No. 

90/013,386 

Volkswagen and 

Bentley 

October 7, 2014 

6,012,007 1-3, 5, 9, 17-21 IPR2015-01004 Honda April 4, 2015 

5,463,374 1-3 IPR2015-01118 FCA April 29, 2015 

 On April 29, 2015, Defendants filed the present motion to stay these cases in light of the 

fact that eleven inter partes review proceedings and three reexamination proceedings had been 

filed challenging the validity of the asserted patents. Defendants argue that it would be more 

efficient for the USPTO to decide the validity of the asserted claims of the patents before this 

Court proceeds with this case. 

On May 11, 2015, the Court held a telephonic scheduling conference with the parties. At 

the conference, the Court inquired about the issues raised in Defendants’ motion to stay because 

the motion had not been fully briefed. 

III. ANALYSIS 

Defendants Ford and FCA move to stay these cases in light of the fact that eleven inter 

partes review proceedings and three reexamination proceedings have been filed challenging the 

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validity of all the claims asserted in the patents-in-suit. Ford and FCA argue that it would be 

more efficient for the USPTO to decide the validity of the asserted claims in the patents before 

this Court proceeds with this case. 

“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, 1426-1427 (Fed. Cir. 1988); see also Landis v. North Am. Co., 299 U.S. 248, 

254-255 (1936). Likewise, courts have broad discretion in deciding whether a stay is appropriate 

pending the conclusion of an inter partes review proceeding. Regents of Univ. of Mich. v. St. 

Jude Med., Inc., No. 12-12908, 2013 WL 2393340, *2 (E.D. Mich. May 31, 2013). 

The decision of whether or not to stay a case until the conclusion of a reexamination or 

inter partes review proceeding is within the sound discretion of the district court. Patlex Corp. v. 

Mossinghoff, 758 F.2d 594, 602-603 (Fed. Cir. 1985); Regents of Univ. of Mich., 2013 WL 

2393340, *2. The decision of whether or not to stay a case is highly fact specific. 

In considering whether or not to stay a case, courts routinely consider at least the 

following three factors: (1) whether a stay will simplify the issues in the case or conserve judicial 

resources; (2) whether a stay will unduly prejudice or present a clear tactical disadvantage to the 

non-moving party; and (3) whether discovery is complete and when (or whether) a trial date has 

been set. Dura Global Techs., LLC v. Magna Int’l Inc., No. 11-cv-10551, 2011 WL 5039883, at 

*6 (E.D. Mich. Oct. 24, 2011); Regents of Univ. of Mich., 2013 WL 2393340, *2 (“To 

determine whether a stay pending inter partes review is appropriate, courts apply the same 

factors as determining whether to stay a case pending reexamination.”). 

As explained fully below, the Court finds that the above factors weigh in favor of 

denying Defendants’ motion to stay this case. 

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A. First Factor: Whether a Stay Will Simplify the Issues in Question and Trial of 

This Case 

The first factor that the Court considers when considering whether or not to grant a stay is 

whether a stay will simplify the issues in the case and/or make the case significantly more 

efficient for the court and the parties. In some cases, an inter partes review or reexamination 

proceeding challenging all asserted claims can “dispose of the entire litigation: the ultimate 

simplification of issues.” VirtualAgility Inc. v. Salesforce.com, Inc., 759 F.3d 1307, 1314 (Fed. 

Cir. 2014). However, an inter partes review or reexamination “need not dispose of a case 

completely to simplify the issues in a case.” Cequent Performance Prods., Inc. v. Hopkins Mfg. 

Corp., No. 13-cv-15293, 2015 WL 1510671, *2 (E.D. Mich. Apr. 1, 2015). 

Defendants argue that this factor favors staying this case because the inter partes review 

and reexamination proceedings before the USPTO will likely simplify the issues in this federal 

court litigation. Defendants point out that all the asserted claims of the patents in the federal 

court litigation are the subject of an inter partes review proceeding and/or ex parte reexamination 

proceeding challenging the validity of the asserted claims. Given the substantial number of inter 

partes review and reexamination proceedings, Defendants argue there is a substantial likelihood 

that some, if not all, of the asserted claims will be cancelled or amended in the inter partes 

review and reexamination proceedings. Defendants argue that the Court should be fully 

informed of the validity and scope of the asserted claims before embarking on a costly litigation. 

Plaintiff argues that the reexamination and inter partes review proceedings “offer little 

hope of simplifying this litigation significantly.” Pl. Resp. at 6 (Dkt. 18). Plaintiff makes three 

arguments. First, Plaintiff argues that it has recently “agreed to dismiss all of the claims asserted 

in this litigation that are at issue before the Patent Office for U.S. Patent No. 5,732,375 and U.S. 

Patent No. 6,775,601.” Id. Plaintiff states that in it “currently intends to amend its complaint to 

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assert other claims of the ‘375 Patent, but those claims are not at issue in the IPR proceedings.” 

Id. at 6 n.1. 

Second, Plaintiff argues that “because only a single IPR proceeding was instituted by 

Ford or FCA, the IPR proceedings will not resolve all, or even most, of the likely validity 

arguments.” Id. at 8. Plaintiff’s argument is based on 35 U.S.C. § 315(e)(2), which estops a 

person who files an inter partes review from making the same invalidity arguments it raised, or 

could have raised, in the inter partes review proceeding in a federal court patent infringement 

lawsuit. Specifically, 35 U.S.C. § 315(e)(2) states: 

The petitioner in an inter partes review . . . or real party in interest 

or privy of the petitioner, may not assert . . . in a civil action . . . 

that the claim is invalid on any ground that the petitioner raised or 

reasonably could have raised during that inter partes review. 

Because almost all of the USPTO proceedings were filed by automobile manufacturers other 

than Ford and FCA, Plaintiff points out that the estoppel provision of 35 U.S.C. § 315(e)(2) will 

not apply to Ford and FCA in this case and, therefore, Ford and FCA will be free to make the 

same arguments in this case as were made before the USPTO. Plaintiff argues that staying this 

case would be unfair because it would give Ford and FCA the benefit of seeing if the other 

automobile manufacturers invalidate the asserted claims in the patents. If other manufacturers 

successfully invalidate the asserted claim in the patents, then the patents would be invalid against 

Ford and FCA. On the other hand, because there would not be estoppel against Ford and FCA, if 

the other manufacturers were unsuccessful in invalidating the asserted patents at the USPTO, 

then Ford and FCA could still make the same arguments in this federal court case. 

Third, Plaintiff points out that any ruling by the USPTO will not resolve all the defenses 

raised by the Defendants. Plaintiff points out that the USPTO proceedings will not resolve the 

defenses of laches, waiver, estoppel, other equitable defenses, and lack of statutory subject 

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matter under 35 U.S.C. § 101. See 35 U.S.C. § 311(b) (limiting the grounds on which an inter

partes review proceeding can be requested to “a ground that could be raised under section 102 or 

103”). 

The Court finds that this factor weighs in favor of not staying this case because the issues 

in this case would not likely be significantly simplified by a stay. First, the Court notes that the 

Plaintiff has agreed to dismiss the asserted claims of the ‘601 and ‘375 Patents that are at issue in 

the inter partes review proceedings and will seek to add different claims that are not at issue in 

the inter partes review proceedings. As to the ‘601 and ‘375 Patent, the subject inter partes

review proceedings will no longer have the potential to further simplify the issues in this case. 

Second, the Court finds that it will likely be able to minimize any negative effects on 

efficiency and judicial economy by working with the parties to carefully draft an appropriate 

scheduling order. Decisions on the inter partes reviews, even if instituted by the USPTO, will be 

completed by the time dispositive motions are filed in this case and before trial. The USPTO 

must render its decision within 18 months of the filing of an inter partes review petition. See 35 

U.S.C. §§ 316(a)(11), 314(b) (providing that normally an inter partes review proceeding will be 

completed within 18 months). Because the last of the inter partes review proceedings was filed 

in April 2015, that means all inter partes review proceedings will be completed by November 

2016. Moreover, by the time that Defendants file their claim construction briefs in this case, 

Defendants will likely be able to see any narrowing amendments and arguments being made to 

the claims in the inter partes review proceedings. 

Third, even if the Court granted a stay, because there is no estoppel provision under 35 

U.S.C. § 315(e)(2), it is likely that a stay will not simplify the issues in this case. Neither the 

estoppel provision of 35 U.S.C. 315(e)(2) nor res judicata principles would prevent Defendants 

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from making the same or similar arguments in this case as being made by other automobile 

manufacturers in the inter partes review proceedings. Moreover, the Court would still have to 

address other defenses not litigated in the inter partes review proceedings, including equitable 

defenses. See Norgren Automation Solution, LLC v. PHD, Inc., No. 14-cv-13400, 2015 WL 

1245942, at *2 (E.D. Mich. Mar. 18, 2015) (denying a motion stay, in part, because a stay would 

“have no impact on [Defendant’s] asserted affirmative defenses, including estoppel, inequitable 

conduct and validity under 35 U.S.C. § 101.”). 

After considering all the facts, the Court finds that staying this case would not likely 

significantly simplify the issues in this case. Moreover, through careful drafting of the schedule 

in this case, efficiencies both for the Court and the parties can be achieved. 

B. Second Factor: Whether Discovery is Complete and Whether a Trial Date Has 

Been Set 

The second factor that the Court considers when deciding whether or not to grant a stay is 

whether discovery is complete and a trial date has been set. This factor recognizes that granting 

a stay early in the case conserves judicial resources and saves the parties time and money by 

waiting to do costly discovery, claim construction, dispositive motions, and trial until after the 

USPTO determines the validity and scope of the asserted claims of the patents. Cequent 

Performance Prods., Inc., 2015 WL 1510671, *2. 

Defendants argue that although this case was filed well over a year ago, the case is in its 

infancy because the case has been delayed due to its transfer from the Central District of 

California. 

Plaintiff argues, among other things, that this case should proceed until it is known for 

sure that the USPTO will even institute the inter partes reviews. Plaintiff also points out that 

decisions on the inter partes reviews will occur before dispositive motions are filed and before 

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trial. Thus, Plaintiff argues that that the Court and the parties will not need to spend time and 

resources on dispositive motions and a trial, if the patents are invalidated in the inter partes 

review proceedings. 

The Court finds that this factor weighs only slightly in favor granting a stay. Although 

this case has been pending well over a year, this case is in its infancy and a stay would generally 

save the parties time and money, if a decision in an inter partes review completely invalidates all 

the claims being asserted in a patent. However, as discussed above, the Court finds that a 

carefully drafted scheduling order will allow decisions in the inter partes review proceedings to 

occur before dispositive motions are filed in this case. Thus, the parties and the Court will 

conserve resources in preparing and deciding dispositive motions and having a trial for any 

patent claims that are invalidated in the inter partes review proceedings. In addition, Defendants 

will likely have the benefit of Plaintiff’s patent owner’s response brief and any claim 

amendments from the inter partes review proceeding when drafting its claim construction 

response brief. Thus, there is less chance of the Court having to readdress claim construction 

issues in light of any claim narrowing arguments and amendments that could occur in the inter 

partes review proceedings. 

The Court also finds that it is likely that discovery costs and claim construction costs will 

be lower in this case than the typical patent infringement case, because the parties should have 

the benefit of discovery and claim construction briefing that has already taken place in the 

related cases filed by Plaintiff against other automobile manufacturers in the Central District of 

California. Plaintiff will have already gathered and produced most of the relevant documents in 

the California case, which Defendants will likely have access to in this case. Defendants will 

also likely have the benefit of depositions, interrogatory responses, invalidity contentions, and 

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claim construction arguments from the California case. In fact, both parties agree that “the Court 

and the parties may streamline claim construction in this case with the benefit of Judge 

Kronstadt’s claim construction order in the Central District.” Joint Discovery Plan & Proposed 

Scheduling Order at 7 (Dkt. 12). Thus, the parties’ discovery costs should be lower in this case 

than they otherwise would be. 

C. Third Factor: Whether a Stay Would Unduly Prejudice or Present a Clear 

Tactical Disadvantage to Signal 

The final factor that the Court considers is whether a stay will unduly prejudice or present 

a clear tactical disadvantage to the non-moving party. 

Defendants argue that a stay would not prejudice Plaintiff, because Plaintiff is not selling 

competing products and, therefore, money damages will fully compensate Plaintiff. Everlight 

Elecs. Co. v. Nichia Corp., No. 12-cv-11758, 2013 WL1821512, at *8 (E.D. Mich. Apr. 30, 

2013). 

Plaintiff argues that it would be prejudiced by a stay because this case is already over a 

year old. If a stay is granted, Plaintiff argues that “months or even years could elapse before this 

litigation leaves the starting gate.” Pl. Resp. at 13. 

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

will be prejudiced by a stay, because a plaintiff has a legitimate interest in having its case timely 

resolved. Significant delay is a consideration here, because many of the inter partes review 

proceedings were not filed until almost a full year after Plaintiff filed its complaint in this case. 

Almost all of the USPTO proceedings were filed in March and April of 2015. In fact, FCA filed 

its inter partes review proceeding one year after Plaintiff was served with the complaint, 

specifically on April 29, 2015. See 5/1/2014 Proof of Service (Dkt. 21), Signal IP, Inc. v. Fiat 

U.S.A., Inc., Case No. 14-cv-03105 (C.D. Cal.). 

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 If a defendant desires a stay, it should endeavor to minimize prejudice to a plaintiff, by 

diligently conducting a prior art search, and then drafting and filing an inter partes review 

petition if it desires to do so. While the Court recognizes that searching for prior art and drafting 

an inter partes review petition does take a significant amount of time, a petitioner should try to 

file an inter partes review proceeding fairly quickly to reduce any prejudice to the Plaintiff.4 

The Court notes that 35 U.S.C. § 315(b) sets an absolute one-year deadline from the 

service of the complaint in federal court to file an inter partes review proceeding. The Court 

notes that FCA filed its inter partes review petition on the one-year statutory deadline. Staying 

this case until completion of the inter partes review proceedings would mean that this case would 

likely not get started for at least two-and-a-half years after the filing of the complaint. See 35 

U.S.C. §§ 316(a)(11), 314(b) (providing that normally an inter partes review proceeding will be 

completed within 18 months). Such a pace would not be appropriate for the prompt dispatch of 

judicial business. 

While the absence of competition between the parties weighs against a finding of 

prejudice, that aspect is outweighed by possible harm from the slow pace to resolution that a stay 

would produce. 

IV. CONCLUSION 

After carefully weighing the foregoing factors and the parties’ arguments, the Court 

denies Defendants’ joint motion to stay (Dkt. 20). The parties shall contact the Court’s Special 

Master Christopher G. Darrow to discuss a proposed schedule for this case. The parties shall use 

the Court’s Model Rule 26(f) Report and Proposed Scheduling Order as a guide in discussing a 

schedule that is appropriate for this case. 

 

4

 Of course, there can be good reasons for delay in filing an inter partes review proceeding. One 

reason would be if the parties are having good faith settlement discussions. 

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SO ORDERED. 

Date: September 30, 2015 s/Mark A. Goldsmith 

 Detroit, Michigan MARK A. GOLDSMITH 

 United States District Judge 

CERTIFICATE OF SERVICE

The undersigned certifies that the foregoing document was served upon counsel of record and 

any unrepresented parties via the Court's ECF System to their respective email or First Class U.S. 

mail addresses disclosed on the Notice of Electronic Filing on September 30, 2015. 

 s/Carrie Haddon 

 Case Manager 

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