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Dentsply Sirona Inc. v. Edge Endo, LLC

United States District Court, D. New Mexico

October 3, 2018

DENTSPLY SIRONA, INC, and TULSA DENTAL PRODUCTS LLC, doing business as Dentsply Sirona Endodontics, Plaintiffs,
v.
EDGE ENDO, LLC, and U.S. ENDODONTICS, LLC Defendants.

          MEMORANDUM OPINION AND ORDER GRANTING DEFENDANTS' MOTION TO STAY PROCEEDINGS PENDING INTER PARTES REVIEW

         THIS MATTER comes before the Court upon Defendants' Motion to Stay Proceedings Pending Inter Partes Review, filed July 10, 2018 (Doc. 147). Having reviewed the parties' briefs and applicable law, the Court finds that Defendants' Motion is well-taken and, therefore, is GRANTED. This matter is therefore STAYED pending inter partes review.

         BACKGROUND

         Plaintiffs and Defendants design and sell endodontic drill files. Plaintiffs filed this patent infringement case on October 10, 2017, alleging that Defendants infringed upon four published patents.

         The Leahy-Smith America Invents Act (“AIA”), Pub.L. No. 112-29, § 6(a), 125 Stat. 284, 299-304 (2011), codified at 35 U.S.C. §§ 311-319 (2013), allows parties to submit petitions for inter partes review to the U.S. Patent Trademark Office, challenging the validity of patent claims on certain limited grounds. The purpose of inter partes review is to create a more efficient, cost-effective alternative to litigation. Personal Web Techs., LLC v. Apple Inc., 69 F.Supp.3d 1022, 1024 (N.D. Cal. 2014).

         On June 29 and July 3 2018, Defendants filed four petitions with the U.S. Patent and Trademark Office for inter partes review (“IPR”) by the Patent Trial and Appeal Board (“PTAB”). Defendants' IPR petitions challenge the patentability of every asserted patent claim in this case, on multiple grounds, including prior public art. Doc. 149, at ¶ 7-9.

         The PTAB will decide whether to institute inter partes review in January 2019. Defendants filed this motion to stay this case on July 10, 2018.

         DISCUSSION

         A decision whether to grant a stay pending inter partes review is made under the totality of the circumstances. Universal Electronics, Inc. v. Universal Remote Control, Inc., 943 F.Supp.2d 1028, 1031 (C.D.Cal.2013), cited in Wonderland Nursery Goods Co. v. Baby Trend, Inc., 2015 WL 1809309, at *2 (C.D. Cal. Apr. 20, 2015).[1] To determine whether to stay a case pending inter partes review, district courts typically consider “(1) whether discovery is complete and whether a trial date has been set; (2) whether a stay will 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 nonmoving party. Digital Ally, Inc. v. Taser Int'l, Inc., No. 16-CV-2032-CM-TJJ, 2017 WL 1048351, at *2 (D. Kan. Mar. 20, 2017); Drink Tanks Corp. v. Growlerworks, Inc., No. 3:16-cv-410-SI, 2016 WL 3844209, at *2 (D. Or. July 15, 2016).

         I. First Factor: Case Progress.

         Under this first factor, courts typically consider “(1) whether parties have engaged in costly expert discovery and dispositive motion practice…. (2) whether the court has issued its claim construction order…and (3) whether the court has set a trial date.” PersonalWeb Techs., LLC v. Apple Inc., 69 F.Supp.3d 1022, 1025-26 (N.D. Cal. 2014) (internal citations omitted); Nichia Corp. v. Vizio, Inc., 2018 WL 2448098, at *2 (C.D. Cal. May 21, 2018) (courts consider timing issues such as “whether discovery is complete, ” “the status of claim construction, ” and “whether a trial date has been set.”).

         Here, substantial and costly work remains in this case, including a claim construction (“Markman”) hearing, document production and review, all depositions, expert discovery, and dispositive motion practice. See Surfcast, Inc. v. Microsoft Corp., No. 2:12-cv-333-JDL, 2014 WL 6388489, at *2 (D. Me. Nov. 14, 2014) (focus is on volume of work remaining before trial, not progress that has already been made).

         Plaintiffs argue that much progress has already been made in this case. When the motion to stay was filed, this case was pending for nine months. Plaintiffs point out that significant discovery had already occurred, and claim construction has been briefed. Although progress has been made in this case, the substantial and significant work remaining in this case weighs toward granting the stay. See PersonalWeb Techs., LLC v. Apple Inc., 69 F.Supp.3d 1022, 1026-27 (N.D. Cal. 2014) (focusing on cost of remaining work in case); Microsoft Corp. v. Tivo Inc., No. 10-cv-00240-LHK, 2011 WL 1748428, at *6 (N.D. Cal. May 6, 2011) (finding that the stage of the litigation weighed in favor of a stay where the parties had exchanged initial disclosures, interrogatory responses, and document discovery, but no depositions had been taken and no expert reports had been exchanged); see also Digital Ally, Inc. v. Taser Int'l, Inc., No. 16-CV-2032-CM-TJJ, 2017 WL 1048351, at *2 (D. Kan. Mar. 20, 2017) (stay granted although case had been litigated vigorously for over a year, including significant discovery and claim construction statements.)

         Moreover, although claim construction has been briefed, that is not dispositive. No. claim construction order has been issued. These circumstances lean toward a stay. Nichia Corp. v. Vizio, Inc., 2018 WL 2448098, at *2 (C.D. Cal. May 21, 2018) (even though claim construction briefs were filed, significant litigation remained, including the Markman hearing, expert discovery, and trial preparation, which favored a stay); Wonderland Nursery Goods Co., 2015 WL 1809309, at *3 (“although the parties [had] submitted claim construction briefs, the Markman hearing has not yet taken place and no disputed claim terms have been construed by this Court.”).

         Plaintiff also argues that this case would likely be finished within 2 years of its start date, before any decision is issued on the IPR petitions. Based on the parties' litigiousness, and the complex issues before the Court in this case, the Court disagrees that this case could be tried and finished before an IPR decision is issued. This Court is in a southwest border district with many criminal cases that take priority. The Court finds that Plaintiffs' affidavit detailing the average case completion time in this district is based on outdated data (or data that will be outdated soon). The ...


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