PersonalWeb Technologies LLC et al v. International Business Machines Corporation

Filing 163

ORDER denying 128 Motion to Stay Pending Reexamination; denying 161 Administrative Motion for Continuance of the Hearing. Signed by Judge Edward J. Davila on 8/9/2016. (ejdlc1S, COURT STAFF) (Filed on 8/9/2016)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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SAN JOSE DIVISION

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PERSONALWEB TECHNOLOGIES LLC,
et al.,
Plaintiffs,

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United States District Court
Northern District of California

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v.
INTERNATIONAL BUSINESS
MACHINES CORPORATION,
Defendant.

Case No. 5:16-cv-01266-EJD
ORDER DENYING DEFENDANT’S
MOTION TO STAY PENDING
REEXAMINATION; DENYING AS
MOOT DEFENDANT’S
ADMINISTRATIVE MOTION FOR
CONTINUANCE OF THE HEARING
Re: Dkt. Nos. 128, 161

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Plaintiffs Personalweb Technologies LLC and Level 3 Communications, LLC

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(collectively, “Plaintiffs”) allege in this action originally filed in the United States District Court

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for the Eastern District of Texas that Defendant International Business Machines Corporation

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(“IBM”) infringes four of its patents, namely United States Patent No. 6,415,280, No. 6,928,442,

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No. 7,802,310, and No. 8,099,420 (“the’420 Patent”). Before the action was transferred to this

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court, IBM instituted a request for ex parte reexamination of one claim of one patent-in-suit -

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claim 166 of the ‘420 patent. The United States Patent and Trademark Office (“USPTO”) initially

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granted IBM’s request and rejected claim 166 as invalid. However, on May 10, 2016, the USPTO

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issued an Ex Parte Reexamination Certificate for the ‘420 patent which confirmed the patentability

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of claim ‘166, thereby concluding IBM’s reexamination request. Dkt. No. 136.

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Presently before the court is IBM’s motion to stay this action “pending final resolution of

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the USPTO’s reexamination of claim 166 of the ‘420 patent, including any appeals therefrom.”

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Dkt. No. 128. Plaintiffs oppose this request. This matter is suitable for resolution without oral

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Case No.: 5:16-cv-01266-EJD
ORDER DENYING DEFENDANT’S MOTION TO STAY PENDING REEXAMINATION;
DENYING AS MOOT DEFENDANT’S ADMINISTRATIVE MOTION FOR CONTINUANCE
OF THE HEARING

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argument pursuant to Civil Local Rule 7-3. Accordingly, the hearing scheduled for August 18,

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2016, is VACATED, and the court finds, concludes and orders as follows:
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“Courts have inherent power to manage their dockets and stay proceedings,

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including the authority to order a stay pending conclusion of a [US]PTO reexamination.” Ethicon,

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Inc. v. Quigg, 849 F.2d 1422, 1426-27 (Fed. Cir. 1988). A stay may be “particularly justified

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where the outcome of the reexamination would be likely to assist the court in determining patent

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validity and, if the claims were cancelled in the reexamination, would eliminate the need to try the

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infringement issue.” In re Cygnus Telecomms. Tech., LLC Patent Litig., 385 F. Supp. 2d 1022,

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1023 (N.D. Cal. 2005).
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Here, it is important to note that the only ex parte reexamination proceeding

United States District Court
Northern District of California

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pending at the time IBM filed its motion was the one it instituted prior to this action’s transfer

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from the Eastern District of Texas. As noted, that reexamination proceeding has since concluded

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with a certificate confirming the patentability of the ‘420 patent, and though IBM has presented

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additional information since briefing on the motion was completed, it has not shown that there

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remains pending any appeal from the USPTO’s determination. Consequently, the court concludes

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that a stay of this action is no longer justified based on the sole basis for relief IBM cited in its

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motion.
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IBM has notified the court that it instituted an additional ex parte reexamination

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regarding claim 166 of the ‘420 patent subsequent to the filing of its motion to stay and after it

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was notified that its first request was unsuccessful. Dkt. No. 137. But because IBM’s abatement

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request was not and could not have been based on this subsequent reexamination - or, for that

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matter, on any other reexamination instituted by parties not named in this case - given the way that

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IBM framed its own pleadings, the court does not consider any other reexamination to be a viable

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reason to grant relief pursuant to the instant motion.1 Moreover, though the court is not

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In any event, the USPTO issued a decision denying IBM’s subsequent reexamination request on
July 19, 2016. Dkt. No. 159.
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Case No.: 5:16-cv-01266-EJD
ORDER DENYING DEFENDANT’S MOTION TO STAY PENDING REEXAMINATION;
DENYING AS MOOT DEFENDANT’S ADMINISTRATIVE MOTION FOR CONTINUANCE
OF THE HEARING

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definitively deciding whether such observation applies to these circumstances, the institution of

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repetitive reexamination requests, in seriatim and after claim construction has occurred, could be

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construed as merely a device for unjustified delay rather than a valid attempt at streamlining a case

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for patent infringement. See Storus Corp. v. AROA Mktg., No. C-06-2454 MMC, 2008 U.S. Dist.

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LEXIS 112142, at *2, 2008 WL 540785 (N.D. Cal. Feb. 25. 2008).

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Accordingly, the Motion to Stay Pending Reexamination (Dkt. No. 128) is DENIED. The
Administrative Motion for Continuance of the Hearing (Dkt. No. 161) is DENIED AS MOOT.

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United States District Court
Northern District of California

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IT IS SO ORDERED.
Dated: August 9, 2016
______________________________________
EDWARD J. DAVILA
United States District Judge

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Case No.: 5:16-cv-01266-EJD
ORDER DENYING DEFENDANT’S MOTION TO STAY PENDING REEXAMINATION;
DENYING AS MOOT DEFENDANT’S ADMINISTRATIVE MOTION FOR CONTINUANCE
OF THE HEARING