Imperium IP Holdings (Cayman), Ltd. v. Samsung Electronics Co., Ltd. et al

Filing 215

MEMORANDUM OPINION AND ORDER - DENYING 171 Opposed SEALED PATENT MOTION -- Defendants' Opposed Motion to Stay Litigation Pending Determination of Imperium's Breach of the Sony License by the District Court of Delaware -- filed by Samsung Electronics Co., Ltd., Samsung Semiconductor, Inc., Samsung Electronics America, Inc. Signed by Judge Amos L. Mazzant, III on 1/19/2016. (baf, )

United States District Court
EASTERN DISTRICT OF TEXAS
SHERMAN DIVISION

IMPERIUM IP HOLDINGS (CAYMAN),
LTD.

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§
§
v.
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SAMSUNG ELECTRONICS CO., LTD.,
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SAMSUNG ELECTRONICS AMERICA,
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INC., SAMSUNG
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TELECOMMUNICATIONS AMERICA,
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LLC, AND SAMSUNG SEMICONDUCTOR, §
INC.
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CIVIL ACTION No. 4:14-CV-371
Judge Mazzant

MEMORANDUM OPINION AND ORDER
Pending before the Court is Defendants‟ Opposed Motion to Stay Litigation Pending
Determination of Imperium‟s Breach of the Sony License by the District Court of Delaware
(Dkt. #171). After reviewing the relevant pleadings, the Court finds that the motion should be
denied.
BACKGROUND
Plaintiff filed suit against Defendants on June 9, 2014, asserting patent infringement. On
November 16, 2015, Defendant Samsung Electronics filed suit against Plaintiff Imperium
regarding a settlement and license agreement with Sony Corporation (“Sony License”) in the
United States District Court for the District of Delaware (See Dkt. #171, Ex. 3).
Defendants filed the present motion to stay on November 30, 2015 (Dkt. #171). Plaintiff
filed an opposition on December 7, 2015 (Dkt. #179), and Plaintiff filed a reply on December 9,
2015 (Dkt. #182).

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LEGAL STANDARD
District courts have the inherent power to stay proceedings pending before them, but this
power is “incidental to the power inherent in every court to control the disposition of the cases
on its docket with economy of time and effort for itself, for counsel, and for litigants.” In re M.J.
Beebe, 56 F.3d 1384, 1995 WL 337666, at *2 (5th Cir. May 15, 1995) (quoting Landis v. N. Am.
Co., 299 U.S. 248, 254 (1936)). Where “there is even a fair possibility that the stay…will work
damage to someone else,” the party seeking a stay “must make out a clear case of hardship or
inequity in being require to go forward.” Landis, 299 U.S. at 255; see Ind. State Police Pension
Tr. v. Chrysler LLC, 556 U.S. 960, 961 (2009) (“„[A] stay is not a matter of right, even if
irreparable injury might result otherwise.‟ It is instead an exercise of judicial discretion, and the
„party requesting a stay bears the burden of showing that the circumstances justify an exercise of
that discretion.‟”(citation omitted)).
ANALYSIS
Defendants argue that, under the Sony License, Plaintiff has formally covenanted not to
assert the patents-in-suit against the Samsung products incorporating Sony image sensors, or to
use Sony image sensors to satisfy any limitation of any claim of the asserted patents (Dkt. #171
at p. 1). Defendants further argue that the Sony License requires that “all disputes and litigation”
regarding the Sony License, “its construction and matters connected with its performance be
subject to the exclusive jurisdiction of the state and federal courts located in Delaware.” (Dkt.
#171 at p. 2). Following filing suit in Delaware, Defendants requested expedited relief in the
Delaware action and requested that this Court stay all proceedings until the Sony License is
properly addressed in the Delaware courts (Dkt. #171 at p. 2).

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Defendants assert that a stay will not unduly prejudice Plaintiff, as enforcement of the
Sony License is merely the application of terms to which Plaintiff itself agreed, but that
Defendants would be prejudiced by proceeding to trial on products for which it has already
licensed (Dkt. #171 at p. 6). Second, Defendants argue that a stay will simplify issues in
question and trial, specifically in reference to the number of products that incorporate Sony
image sensors (Dkt. #171 at p. 6). Defendants contend a stay pending the Delaware action
would make it unnecessary for the parties to litigate, experts to address, and the jury to consider
these products (Dkt. #171 at pp. 6-7). Finally, Defendants argue that the late timing of this
motion is a problem of Plaintiff‟s making due to attempts to conceal its reliance on Sony sensors
as part of proof of infringement (Dkt. #171 at p. 7).
On December 4, 2015, the Delaware court denied Samsung‟s motion for expedited
proceedings, and determined that the Court is in a better position than the Delaware court to
resolve, at the very least, the initial issue of whether Imperium asserted infringement against
products covered by the Sony License and whether such assertion was made timely or concealed
(Dkt. #179, Ex. 1). The Delaware court also stated that “although going to trial is a costly
proposition, such costs can be calculated and reimbursed,” avoiding irreparable harm.

Id.

Additionally, the court ruled that “while forum selection clauses should generally be enforced,
Samsung … did not bargain for the clause and had no „settled expectations‟ regarding such,” and
“interests identified with enforcing such clauses are outweighed under the circumstances at bar
by the interests of judicial efficiency and comity.” Id. Following this reasoning, the Delaware
court stayed the litigation pending further order of the court. Id.
Defendants‟ reply brief, while appearing on its face to be support of its motion to stay,
does not in fact continue to argue for a stay, but presents a summarization of the circumstances

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that led Defendants to file a motion to stay, advisement of collateral proceedings before the
Patent Trials and Appeals Board, and requests a status conference.
The Court finds, considering the Delaware court‟s issuance of a stay and its order making
clear its belief that this Court is the proper court to address, at the very least, initial issues in this
case, that a stay will not simplify issues for trial or serve any practical purpose under these
circumstances.

.

CONCLUSION
It is therefore ORDERED that Defendants‟ Opposed Motion to Stay Litigation Pending
Determination of Imperium‟s Breach of the Sony License by the District Court of Delaware
(Dkt. #171) is hereby DENIED.

SIGNED this 19th day of January, 2016.

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AMOS L. MAZZANT
UNITED STATES DISTRICT JUDGE

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