Masterobjects, Inc. v. Yahoo! Inc.

Filing 82

ORDER DENYING WITHOUT PREJUDICE 81 Motion to Amend Invalidity Contentions; GRANTING 66 Motion to Stay; ADMINISTRATIVELY CLOSING CASE.Signed by Judge Jeffrey S. White on April 2, 2014. (jswlc3, COURT STAFF) (Filed on 4/2/2014)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA
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MASTEROBJECTS, INC.,

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For the Northern District of California

United States District Court

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Plaintiff,

No. C 11-02539 JSW

v.
YAHOO! INC.,

ORDER GRANTING MOTION TO
STAY

Defendant.
/

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Now before the Court is Defendant Yahoo! Inc.’s motion to stay this matter pending

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resolution of the appeal in MasterObjects, Inc. v. Google Inc., 11-cv-01054 PJH, currently

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before the Federal Circuit. The Court finds that this matter is appropriate for disposition

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without oral argument and it is hereby deemed submitted. See Civ. L.R. 7-1(b). Accordingly,

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the hearing set for April 11, 2014 is HEREBY VACATED. Having considered the parties

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pleadings, the relevant legal authority, the Court hereby GRANTS Defendant’s motion to stay.

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When ruling on such a stay, courts consider several factors: (1) the stage of the

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litigation, including whether discovery is or will be almost completed and whether the matter

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has been marked for trial; (2) whether a stay will unduly prejudice or tactically disadvantage the

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nonmoving party; and (3) whether a stay will simplify the issues in question and streamline the

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trial, thereby reducing the burden of litigation on the parties and on the court. Id. There is a

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“liberal policy in favor of granting motions to stay proceedings pending the outcome of USPTO

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reexamination or reissuance proceedings.” ASCII Corp. v. STD Entertainment, 844 F. Supp.

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1378, 1381 (N.D. Cal. 1994).

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Both parties agree that the resolution of the appeal will effect the resolution and scope of

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dispositive legal issues currently before this Court. The only difference between the parties’

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positions is Plaintiff’s contention that they should be permitted an opportunity to finish

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discovery. Plaintiff agrees to resolve dispositive motions after the resolution of the appeal.

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However, a stay pending a potentially dispositive ruling in another forum is less warranted the

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closer the case is to trial. The early stage of a litigation weighs in favor of granting a stay

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pending reexamination. See, e.g., Target Therapeutics, Inc. v. SciMed Life Sys., Inc., 33

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U.S.P.Q.2d 2022, 2023 (N.D. Cal. 1995) (holding that the absence of “significant discovery” or

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“substantial expense and time . . . invested” in the litigation weighed in favor of staying the
litigation); see also ASCII Corp., 844 F. Supp. at 1381 (granting stay where parties had

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For the Northern District of California

United States District Court

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undertaken little or no discovery and the case had not yet been set for trial); see also

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Evolutionary Intelligence, LLC v. LivingSocial, Inc., 2014 WL 213179, at *2 (N.D. Cal. Jan. 17,

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2014) (“The early stage of this action accordingly favors a stay.”). A stay is most appropriate in

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the earlier stages of litigation as, depending upon the outcome of the appeal, the parties and the

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Court may not avoid unnecessary and time-consuming discovery and motions practice.

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Accordingly, Defendant’s motion for a stay is GRANTED and the Clerk shall

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ADMINISTRATIVELY CLOSE this case. Due to the stay, Defendant’s motion for leave to

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serve supplemental invalidity contentions is DENIED without prejudice to re-filing once the

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stay is lifted.

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The Court HEREBY ORDERS the parties to submit notice to the Court within 10 days

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of issuance of the appeal. In their notice, the parties shall request that the stay be lifted, the

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matter be reopened, and that a case management conference be scheduled.

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IT IS SO ORDERED.

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Dated: April 2, 2014
JEFFREY S. WHITE
UNITED STATES DISTRICT JUDGE

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