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IN THE UNITED STATES DISTRICT COURT 

FOR THE SOUTHERN DISTRICT OF OHIO 

EASTERN DIVISION

KIT CHECK, INC., 

Plaintiff, 

v. 

HEALTH CARE LOGISTICS, INC., 

Defendant 

Case No. 2:17-cv-01041-ALM-CMV 

Judge Algenon L. Marbley 

Magistrate Judge Chelsey M. Vascura 

DEFENDANT HEALTH CARE LOGISTICS, INC.’S MOTION FOR STAY IN 

VIEW OF REQUESTS FOR EX PARTE REEXAMINATION 

Defendant Health Care Logistics, Inc. (“HCL”) hereby respectfully moves the 

Court to stay this proceeding in light of five pending Requests for Ex Parte Reexamination 

that HCL has recently filed with the United States Patent and Trademark Office, 

challenging the validity of each of the asserted patent claims. 

As set forth more fully in the accompanying memorandum, Reexamination of the 

Asserted Patents is likely to simplify, if not eliminate, many of the claims involved in this 

case. Furthermore, Plaintiff Kit Check, Inc. (“KCI”) will not be unduly prejudiced by a 

stay, as discovery is still underway and there has been no claim construction decision 

issued. The parties have also obtained leave to amend their infringement contentions and 

invalidity contentions in the future. Proceeding with the case could be unproductive if the 

USPTO finds the asserted claims to be invalid, or if the asserted claims are otherwise 

amended during the course of reexamination. 

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MEMORANDUM IN SUPPORT 

 HCL respectfully requests that this Court stay these proceedings pending HCL’s 

requested ex parte reexamination of each of the five asserted patents: U.S. Patent Nos. 

8,990,099 (“the ’099 Patent”); 9,058,412 (“the ’412 Patent”); 9,058,413 (“the ’413 

Patent”); 9,367,665 (“the ’665 Patent”); and 9,805,169 (“the ’169 Patent”) (collectively 

referred to as the “Asserted Patents”). In the past week, Requests for Ex Parte

Reexamination for each of the Asserted Patents were filed with the United States Patent 

and Trademark Office (“USPTO”) Central Reexamination Unit.1 Copies of the requests 

(collectively referred to as the “Requests”) are included with this brief as Exhibit A (ʼ099 

Request); Exhibit B (ʼ412 Request); Exhibit C (ʼ413 Request); Exhibit D (ʼ665 Request); 

and Exhibit E (ʼ169 Request). See Declaration of Beverly Marsh (“Marsh Dec”) at ¶¶ 7-

11; Exhibits A-E). The Requests seek invalidation of each of the 65 patent claims asserted 

by KCI. HCL alternatively requests a stay of these proceedings pending the USPTO’s 

decision on whether to grant reexamination. 

I. BACKGROUND 

This lawsuit was filed by KCI on December 1, 2017. (Dkt. No. 1, Complaint). KCI 

asserts that HCL infringes five related patents, all titled “Management of Pharmacy Kits.” 

(Dkt. No. 1; Dkt. No. 53, Joint Stipulation of Partial Dismissal). KCI is presently asserting 

a total of 65 claims from the Asserted Patents against HCL. (See Declaration of Beverly 

Marsh (“Marsh Dec.”) at ¶¶ 3-4). 

																																																								

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 The Requests for the ‘099 and ‘413 Patents were filed on July 25, 2019; Requests for the ‘412 and ‘665 

Patents were filed on July 26, 2019, and the Request for the ‘169 Patent was filed on July 29, 2019. See 

Marsh Dec. at ¶¶ 7-11. 

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The parties are currently engaged in discovery. Although a claim construction 

hearing has taken place, the claim construction order has not yet issued. No trial date has 

been scheduled. Id., at ¶ 5. No dispositive motions are pending before the Court. Marsh 

Dec. at ¶ 6. 

HCL filed a motion for stay on January 21, 2019, asking the Court to stay the 

proceedings pending resolution of HCL’s petitions for inter partes review (the “IPR” 

Petitions) of the Asserted Patents that were filed with the Patent Trial and Appeal Board in 

November and December of 2018. (Dkt. No. 48, HCL’s Motion for Stay). On April 29, 

2019, this Court ordered that HCL’s Motion for Stay be held in abeyance until the PTAB 

rendered its decision on HCL’s IPR Petitions. (Dkt. No. 55, Opinion & Order). The parties 

have since notified the Court that the IPR Petitions were denied by the PTAB in June. (Dkt. 

Nos. 57, 58). 

The PTAB did not give any opinion regarding the validity or invalidity of the 

asserted patents. Rather, the PTAB held the IPR Petitions were insufficient in light of a 

perceived failure to identify a motivation to combine the prior art references identified by 

HCL. However, the PTAB did not give any opinion about whether there is, or is not, a 

motivation to combine the prior art references identified in the IPR Petitions, just that HCL 

allegedly did not identify what the motivation to combine was. 

HCL strongly believes that each of the asserted claims is invalid as anticipated 

and/or obvious under 35 U.S.C. §§ 102, 103 in view of the prior art (among other reasons 

for invalidity not relevant to the ex parte reexamination process). As compared with the 

IPR process, ex parte reexamination is an alternative means for invalidating patent claims 

in view of prior patents or printed publications. Whereas IPR petitions are filed before the 

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PTAB, requests for ex parte reexamination are filed before the Central Reexamination Unit 

of the USPTO. Participation in one proceeding does not necessarily preclude participation 

in the other: a patent can be both the subject of an IPR petition and a request for ex parte

reexamination, particularly if the IPR petition is denied and no IPR is instituted. See HP 

Inc. v. MPHJ Tech. Invs., LLC, 817 F.3d 1339, 1347 (Fed. Cir. 2016) (“[t]he noninstituted 

grounds do not become part of the IPR. Accordingly, the estoppel provisions of § 315(e)(1) 

do not apply”); 35 U.S.C. § 315(e)(1). 

Accordingly, HCL has sought invalidation of each of the 65 asserted patents claims 

through the five requests for ex parte reexamination, on the grounds that each of the claims 

are invalid as anticipated under 35 U.S.C. § 102, or invalid as obvious under 35 U.S.C. § 

103. 

While the IPR Petitions were not decided on substantive grounds, HCL feels it 

necessary to point out to the Court that the Requests include more arguments for invalidity 

of the asserted patents as the Requests, unlike the IPR Petitions, are not subject to a strict 

word count limit. HCL’s Requests also include prior art references and prior art 

combinations not included in the Petitions. Lastly, the Requests include arguments for 

invalidity under 35 U.S.C. § 102 (anticipation) whereas the IPR Requests did not. 

 For each Request, the USPTO has three months from the Request filing date to 

determine whether or not a substantial new question of patentability (“SNQP”) affecting 

any claim of the subject patent has been raised by HCL’s Request. If a SNQP is not found 

then the reexamination process will end. If a SNQP to even one claim is found, an order 

for ex parte reexamination of the patent is issued. See 35 U.S.C. § 304. Throughout the 

reexamination process claims may be cancelled as invalid, amended by the Patent Owner, 

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or even new claims added. For reexaminations that proceed, the eventual conclusion of 

the reexamination occurs when a reexamination certificate is issued. See 35 U.S.C. 307. 

Among other things, the certificate identifies (1) whether any claims are cancelled as 

unpatentable; (2) whether any claims are confirmed as patentable; and (3) whether any 

claims have been amended or new claims added as patentable. 35 U.S.C. § 307. 

 USPTO statistics show that approximately 91% of requests for ex parte

reexamination are granted. (Exhibit F, USPTO “Ex Parte Reexamination Filing Data – 

September 30, 2018”, at pg. 1(Item 5 – “Decisions on Requests”); Marsh Dec. at ¶ 12). 

Furthermore, approximately 67% of issued reexamination certificates have included 

changes to the claims of the reexamined patent. Ex. F at pg. 2 (Item 8 – “Reexam certificate 

claim analysis”). 

II. RELEVANT LAW AND ARGUMENT 

 This Court has recognized that “the issue of whether to stay an action for alleged 

patent infringement pending the reexamination process lies within the sound discretion of 

the Court.” See Lear Corp. v. TS Tech U.S. Corp., Case No. 2:11-cv-245, 2011 U.S. Dist. 

LEXIS 162002, at *2-3 (S.D. Ohio Oct. 24, 2011) (granting motion to stay pending 

reexamination). 

 As previously recognized by this Court, in determining whether to stay litigation 

pending reexamination, courts generally weigh three factors: (1) whether a stay would 

unduly prejudice or present a clear tactical disadvantage to the non-moving party; (2) 

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

discovery is complete and whether a trial date has been set. Lear Corp., U.S. Dist. LEXIS 

162002, at *3. Here, the relevant factors heavily weigh in favor of a stay. 

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A. A Stay Will Not Unduly Prejudice KCI or Present a Clear Tactical 

Disadvantage to KCI 

The relevant analysis of this factor is not whether KCI may be prejudiced, but 

whether KCI will be unduly prejudiced by a stay or suffer a clear tactical disadvantage. 

As HCL previously argued in a prior motion for stay, it would be contradictory for KCI to 

argue undue prejudice when KCI waited approximately a year after contacting HCL about 

its asserted patents to even file this lawsuit. (See Dkt. No. 48 at pg. 9). Furthermore, KCI 

has not moved for a preliminary injunction. See VirtualAgility Inc. v. Salesforce.com, 759 

F.3d 1307, 1319 (Fed. Cir. 2014) (finding that the patent owner’s stated reasons for not 

pursuing preliminary injunction “contradicts [patent owners] assertion that it needs 

injunctive relief as soon as possible.”) 

There is no clear tactical disadvantage that KCI would suffer during a stay. As the 

Court is aware, HCL and KCI have stipulated and obtained the Court’s leave to amend 

their infringement and invalidity contentions. (Dkt. No. 60). The parties can even wait 

until after the issuance of the claim construction order to serve their amended contentions. 

Id. Accordingly, it is already presumed that the parties will be doing further work to revise 

their contentions, lessening any claim of undue prejudice. 

B. A Stay Has the Potential to Greatly Simplify the Issues in this Case 

It is very likely that the USPTO will grant HCL’s Requests for ex parte

reexamination against the Asserted Patents. It is also likely that at least some of the 65 

asserted claims will be cancelled as invalid or amended by KCI in order to survive 

reexamination. As stated above, USPTO statistics show that approximately 91% of 

reexaminations have historically been granted, and of those 67% result in changes to the 

claims. See Exhibit F, at pg. 2. In addition to supporting a strong likelihood of success, 

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these statistics also demonstrate the great extent to which the claims of this case may be 

simplified. 

If the USPTO were to invalidate all of the asserted claims then KCI’s patent claims 

would be moot. Apart from invalidation, even amendment of KCI’s asserted claims as a 

result of the reexamination could effectively result in a reduction of KCI’s patent claims as 

patent claim amendments could moot KCI’s infringement arguments. 

Lastly, it is pointed out that when HCL filed its IPR Petitions, the Petitions did not 

include all claims asserted in the case, but rather a subset of claims that excluded 

“transparent tail” tag claims. The “transparent tail” claims have since been removed from 

this case, mainly through the dismissal of KCI’s counts for infringement of the ʼ479 and 

ʼ294 patents. (Dkt. No. 53, Joint Stipulation of Partial Dismissal Without Prejudice)2

. All 

of the 65 claims currently asserted by KCI against HCL are the subject of HCL’s pending 

Requests for ex parte reexamination. 

C. A Stay of This Case Will Conserve Judicial Resources 

District Courts measure the stage of litigation by the date the motion for stay is 

filed. See VirtualAgility Inc. v. Salesforce.com, Inc., 759 F.3d 1307, 1317 (Fed. Cir. 2014) 

(“Generally, the time of the motion is the relevant time to measure the stage of litigation.”) 

In its April 29, 2019 decision on HCL’s first motion for stay, the Court found that 

“the stage of litigation here is neutral.” See Dkt. No. 55 at pg. 2-3. HCL respectfully 

asserts that this factor should still be considered neutral, and not weigh against a stay. Even 

though three months have since passed, fact discovery is still underway, no trial date has 

been set, and the parties are still awaiting a claim construction order. 

																																																								

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 KCI has also informed HCL that it is no longer asserting Claim 53 of the ʼ169 patent, the only 

“transparent tail” tag claim previously asserted that was not in the ’479 or ’294 Patent. 

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 If a stay is not granted and the USPTO grants HCL’s ex parte reexamination 

Requests, there is great potential for wasted efforts by both the Court and the parties. For 

example, time and resources devoted to the litigation of claims cancelled or amended will 

have been wasted. Efforts pertaining to claim construction, invalidity contentions, and 

infringement contentions would need to be repeated to address any amended language of 

the claims, or cancelled claims. Indeed, the Federal Circuit has held that cancellation of 

claims by the USPTO moots pending litigation on those claims where no final judgment 

has been entered by the court. See Fresenius USA, Inc. v. Baxter Int’l, Inc., 721 F.3d 1330, 

1347 (Fed. Cir. 2013) (vacating jury finding of validity and infringement where USPTO 

invalidated challenged claims while litigation still pending on appeal). 

For at least the above reasons, a stay is warranted in order to conserve judicial 

resources. 

D. A Stay Should be Granted Now While the USPTO is Considering 

Whether to Grant HCL’s Requests 

Delaying a stay while the USPTO considers whether to grant HCL’s pending 

Requests will require the parties and this Court to expend efforts that may prove to be 

unproductive if institution is granted and any of the claims are later cancelled or amended. 

HCL is aware that the Court previously declined to enter a stay pending decisions 

on whether to institute HCL’s IPR Petitions and held the decision in abeyance pending the 

decision. However, it is possible that the next three months of this litigation could involve 

many activities and efforts by both parties. If the Court were to issue a claim construction 

order in the very near term it is entirely possible that the next three months would require 

the parties to finish fact discovery and serve initial expert reports (as well as serve their 

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amended invalidity and infringement contentions). (See Dkt. No. 23-1, Preliminary 

Pretrial Order, Proposed Schedule). 

III. CONCLUSION 

For the above reasons HCL respectfully requests that the Court stay these 

proceedings pending a final decision by the USPTO on HCL’s ex parte reexamination 

Requests. In the alternative, HCL respectfully requests a temporary stay pending the 

USPTO’s decision whether to grant reexamination on HCL’s Requests, after which time 

the Court may consider a longer stay. 

Respectfully submitted, 

s/ Beverly A. Marsh 

Jeffrey S. Standley (OH Bar 0047248) 

F. Michael Speed, Jr. (OH Bar 0067541) 

Beverly A. Marsh (OH Bar 0080935) 

Standley Law Group LLP 

6300 Riverside Drive 

Dublin, Ohio 43017 

Telephone: (614) 792-5555 

Facsimile: (614) 792-5536 

Email: jstandley@standleyllp.com 

mspeed@standleyllp.com 

bmarsh@standleyllp.com 

litigation@standleyllp.com 

Attorneys for Defendant/Counterclaim 

Plaintiff Health Care Logistics, Inc. 

 

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CERTIFICATE OF SERVICE 

 I certify that on July 31, 2019, the foregoing was served via the Court’s CM/ECF 

filing system, which will send notification of such filing to all counsel of record. 

s/ Beverly A. Marsh 

 Beverly A. Marsh 

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