Brite-Strike Technologies, Inc. v. E. MISHAN & SONS, INC.,

Filing 38

Judge Nathaniel M. Gorton: ENDORSED ORDER entered. MEMORANDUM AND ORDER.For the forgoing reasons, defendants motion to stay(Docket No. 18) is DENIED. So ordered.(Caruso, Stephanie)

United States District Court
District of Massachusetts
)
Brite-Strike Technologies, Inc. )
)
and Telebrands Corp.
)
)
Plaintiffs,
)
)
v.
)
)
E. Mishan & Sons, Inc.
)
)
Defendant.
)

Civil Action No.
16-11672-NMG

MEMORANDUM & ORDER
GORTON, J.
Plaintiffs Brite-Strike Technologies, Inc. and Telebrands
Corp. allege defendant E. Mishan & Sons, Inc. (“Emson”)
infringed one of its patents relating to a compact flashlight
and a method for operation of such a flashlight.
Defendants responded with several counterclaims against
plaintiffs and a motion to stay the case pending an ex parte
reexamination of the subject patent by the United States Patent
and Trademark Office (“USPTO”).

For the following reasons,

defendant’s motion to stay will be denied.
I.

Background
Brite-Strike Technologies, Inc. produces so-called tactical

flashlights, which are used as sources of bright light and as
tools for self-defense, for sale to consumers, law enforcement
and the military.

It is the assignee of United States Patent

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No. 7,866,841 (“’841 patent”), which was issued in January,
2011.

Telebrands, Inc., a marketing company, owns exclusive

rights to the ’841 patent under a license agreement with BriteStrike.

Emson is a competitor of Brite-Strike that also

produces tactical flashlights.
The ’841 patent, entitled “Compact Flashlight,” is directed
toward a small flashlight which is controlled by a user-operated
switch.

Brite-Strike utilized the patented technology to

manufacture a tactical flashlight, the mode of which can be
changed by the touch of a finger, purportedly unlike other
flashlights which require two hands to operate.
In August, 2016, plaintiffs filed this patent infringement
action.

Defendant has denied the substantive claims and

asserted several affirmative defenses and counterclaims.

It has

also sought, ex parte, and recently received leave of the USPTO
for, the reexamination of the ’841 patent.

It now seeks to stay

this action pending that reexamination.
II.

Defendants’ Motion to Stay
A.

Legal Standard

It is well established that
[c]ourts 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, 1426–27 (Fed. Cir. 1988)
(citation omitted).

While courts have the power to grant a stay

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if there is a pending reexamination, they are not required to do
so. Viskase Corp. v. Am. Nat’l Can Co., 261 F.3d 1316, 1328
(Fed. Cir. 2001).

The decision to grant a stay is within the

court’s discretion. Id.

In evaluating whether a stay is

appropriate, courts consider the following 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 . . . and
[the] trial of the case; and
3) whether discovery is complete and whether a trial
date has been set.
Englishtown, Inc. v. Rosetta Stone Inc., 962 F. Supp. 2d
355, 359 (D. Mass. 2013).
B.

Application

With respect to the first factor, defendant avers that
plaintiffs will not be unduly prejudiced because 1) they did not
seek a preliminary injunction and requested a 30-day extension
to respond to the complaint, 2) they are not the only
competitors in the market and 3) defendant is not seeking a stay
for tactical purposes.
Plaintiffs respond that the long reexamination and appeals
process, combined with the tactical advantage that results from
such process, tilts the first factor in their favor.

The Court

agrees.
The parties agree that the USPTO takes an average of two
years to complete a reexamination.

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The delay could be extended

by years if plaintiffs appeal an adverse decision pursuant to 35
U.S.C. § 306.

Even a delay of two years could severely

prejudice plaintiffs, however, because they are in direct
competition with defendant. See ADA Sols., Inc. v. Engineered
Plastics, Inc., 826 F. Supp. 2d 348, 351 (D. Mass. 2011).
Moreover, it is undeniable that a stay would be to the
tactical disadvantage of Brite-Strike and Telebrands.

First,

the Federal Circuit Court of Appeals has determined that, if
there is concurrent litigation and reexamination with respect to
the same patent and the patent is found invalid in the final
reexamination proceeding, the invalidity decision controls the
outcome in the ongoing litigation. Fresenius USA, Inc. v. Baxter
Int’l, Inc., 721 F.3d 1330, 1339–41 (Fed. Cir. 2013).

Second, a

stay in this case would put on hold plaintiffs’ claims against
Emson while Emson proceeds with its claims against Telebrands in
a concurrent action in the Southern District of New York, E.
Mishan & Sons v. Telebrands Corp., No. 16-cv-06918 (S.D.N.Y.).
The Court also concludes that the simplification-of-issues
factor favors plaintiffs as well.

Emson asserts several

affirmative defenses and counterclaims that allege that the ’841
patent is invalid under 35 U.S.C. §§ 101, 102, 103 and 112 but
the USPTO will reexamine the patent only under § 103.
Similarly, defendant’s invalidity defense and counterclaim are
based upon myriad references, only some of which are subject to

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reexamination by the USPTO.

Because several issues will remain

unresolved, particularly with respect to defendant’s affirmative
defenses and counterclaims, the simplification factor does not
favor a stay. See ADA Sols. 826 F. Supp. 2d at 351-52.
Finally, with respect to the third factor, although
defendant promptly filed its motion and this case is in its
early stages, that alone does not compel a stay.

In fact, the

Court concludes that, in this case, the first two factors trump
the third. Id. at 352 (reasoning that although the motion to
stay was filed early in the case, “a stay would not be prudent”
in light of the other factors).

ORDER
For the forgoing reasons, defendant’s motion to stay
(Docket No. 18) is DENIED.
So ordered.

/s/ Nathaniel M. Gorton_____
Nathaniel M. Gorton
United States District Judge
Dated January 24, 2017

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