Milwaukee Electric Tool Corporation et al v. Hilti Inc

Filing 84

ORDER LIFTING STAY signed by Judge J.P. Stadtmueller on 12/30/2016 GRANTING 79 Plaintiffs' MOTION to Lift Stay. (cc: all counsel)(jm)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF WISCONSIN
MILWAUKEE ELECTRIC TOOL
CORPORATION,
METCO BATTERY TECHNOLOGIES LLC,
AC (MACAO COMMERCIAL OFFSHORE)
LIMITED, and
TECHTRONIC INDUSTRIES CO. LTD.,

Case No. 14-CV-1288-JPS

Plaintiffs,
v.
HILTI, INC.,
Defendant.
MILWAUKEE ELECTRIC TOOL
CORPORATION, METCO BATTERY
TECHNOLOGIES LLC, AC (MACAO
COMMERCIAL OFFSHORE) LIMITED, and
TECHTRONIC INDUSTRIES CO. LTD.,
Plaintiffs,
v.
CHERVON NORTH AMERICA, INC.
Defendant.

Case No. 14-CV-1289-JPS

MILWAUKEE ELECTRIC TOOL
CORPORATION, METCO BATTERY
TECHNOLOGIES LLC, AC (MACAO
COMMERCIAL OFFSHORE) LIMITED, and
TECHTRONIC INDUSTRIES CO. LTD.,

Case No. 14-CV-1295-JPS

Plaintiffs,
v.
POSITEC TOOL CORPORATION and
POSITEC USA, INC.,
Defendants.

MILWAUKEE ELECTRIC TOOL
CORPORATION, METCO BATTERY
TECHNOLOGIES LLC, AC (MACAO
COMMERCIAL OFFSHORE) LIMITED, and
TECHTRONIC INDUSTRIES CO. LTD.,

Case No. 14-CV-1296-JPS

Plaintiffs,
v.
SNAP-ON INCORPORATED,

ORDER
Defendant.

Before the Court is Plaintiffs’ second motion to lift the stay of
proceedings in these patent actions, referred to collectively as the “Related
Cases.” (Docket #131).1 Plaintiffs ask the Court to lift the stay in light of the
recent decisions of the United States Patent and Trademark Office Patent
Trial and Appeal Board (“PTAB”) on inter partes review (“IPR”) of Plaintiffs’
patents. During IPR, the PTAB upheld the validity of Plaintiffs’ patents
against Defendants’ challenges. Defendants oppose lifting the stay, arguing

1

For ease of reference, the Court will refer only to the docket in Case No. 14cv-1289 except as otherwise noted.

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that it should continue while they appeal the PTAB’s rulings to the Federal
Circuit. For the reasons stated below, Plaintiffs’ motion will be granted.
1.

BACKGROUND
This is the third time the Court has addressed the stay. Because the

parties are well-versed in the facts and procedural history of the Related
Cases, the stay, and the IPR proceedings related to these cases, the Court will
not review them again here. See (Docket #129); Milwaukee Electric Tool Corp.
v. Hilti, Inc., 138 F. Supp. 3d 1032, 1034–36 (E.D. Wis. 2015). The Court will
briefly review only the facts necessary to its decision.
First, on October 2, 2015, the Court granted Defendants’ motion to
stay the Related Cases to permit them to litigate requests for IPR of Plaintiffs’
patents before the PTAB. (Docket #112). Next, on October 28, 2016, the Court
denied Plaintiffs’ motion to lift the stay in two of the four Related Cases.
(Docket #129). The Court determined that although Defendants’ initial IPRs
related to these cases had been unsuccessful, Defendants had filed several
subsequent IPRs that were soon to be decided. See id. at 5–8. The Court
therefore resolved to continue the stay and ordered the parties to provide an
update when the new sets of IPRs were ruled upon by the PTAB. Id. at 8–9.
On November 15, 2016, Plaintiffs reported that the PTAB issued final
written decisions in the subsequent IPRs, upholding the validity of each of
the relevant patents. (Docket #130); (Docket #132 at 2–3).2 After receiving
these rulings, Defendants appealed to the Federal Circuit. (Docket #135).
Those appeals have been consolidated before the Court of Appeals. Id. The

2

As noted in the Court’s recent order, in IPR proceedings the PTAB reviews
only a limited set of grounds on which a patent may be declared invalid. (Docket
#129 at 2); 35 U.S.C. § 311(a)–(b).

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median time for a decision from the Federal Circuit is around eleven months.
Id.
In light of their appeal to the Federal Circuit, none of the Defendants
would consent to a lifting of the stay. As a result, Plaintiffs have filed a
second motion requesting that the stay be lifted. (Docket #131). Defendants
coordinated to draft a single opposition brief. (Docket #132). Plaintiffs have
replied (Docket #134), and so the motion is ripe for disposition.
2.

ANALYSIS
A fresh look at the considerations pertinent to continuing or ending

a stay reveals that it is time for the Related Cases to move forward. Those
factors include:
(1) the stage of the litigation, including whether discovery is
complete and a trial date has been set; (2) whether a stay will
simplify the issues in question and the trial of the case; and (3)
whether a stay will unduly prejudice or present a clear tactical
disadvantage to the nonmoving party.
ACQIS, LLC v. EMC Corp., No. 14-CV-13560-ADB, 2015 WL 3617106, at
*4 (D. Mass. June 10, 2015) (quoting SurfCast, Inc. v. Microsoft Corp., No.
2:12–CV–333, 2014 WL 6388489, at *1 (D. Me. Nov. 14, 2014)). As the Court
previously observed, a stay is particularly justified when “the outcome of a
PTO proceeding is likely to assist the court in determining patent validity or
eliminate the need to try infringement issues.” Evolutionary Intelligence, LLC
v. Millennial Media, Inc., No. 5:13–cv–4206, 2014 WL 2738501, at *2 (N.D. Cal.
June 11, 2014). However, courts are not bound to counting the applicable
factors; rather, they have discretion to consider the totality of the
circumstances presented. Rensselaer Polytechnic Inst. v. Apple Inc., 1:13-cv0633, 2014 WL 201965, at *3 (N.D.N.Y. Jan. 15, 2014); Universal Electronics, Inc.
v. Universal Remote Control, Inc., 943 F. Supp. 2d 1028, 1031 (C.D. Cal. 2013).
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In this case, Defendants were granted a stay of over one year so that
they could pursue IPR of Plaintiffs’ patents. They failed to convince the PTAB
that the patents in suit should be invalidated. Although the Court is
cognizant of the possibility that the Federal Circuit may reverse or modify
the PTAB’s rulings, this possibility alone is insufficient to warrant what looks
to be another year-long stay of proceedings. At some point, the parties will
have to resolve the claims brought before this Court, and Defendants have
not proffered sufficient reasons to delay the day of judgment any longer.
The Court appreciates that substantial discovery remains to be done
in this case and that this normally weighs in favor of a stay. VirtualAgility Inc.
v. Salesforce.com, Inc., 759 F.3d 1307, 1316 (Fed. Cir. 2014). Yet until the stay
in this case is lifted, there will always be a great deal of discovery remaining.
Likewise, although a ruling from the Federal Circuit might further simplify
the issues or provide the Court further guidance, see Depomed Inc. v. Purdue
Pharma, L.P., No. 13-571, 2016 WL 50505, at *2 (D.N.J. Jan. 4, 2016), the Court
cannot wait indefinitely to resolve Plaintiffs’ claims, ACQIS, LLC v. EMC
Corp., Civil Action No. 14-cv-13560, 2016 WL 4250245, at *2–3 (D. Mass. Aug.
10, 2016); see also Chrimar Sys., Inc. v. Adtran, Inc., CIVIL NO.
6:15-CV-618-JRG-JDL, 2016 WL 4080802, at *2 (E.D. Tex. Aug. 1, 2016)
(observing that a plaintiff “has an interest in the timely and cost effective
enforcement of its patent rights”). The Court already has the benefit of the
expert guidance of the PTAB, and Defendants do not explain why the insight
of the Federal Circuit would be substantially more helpful beyond the
prospect of reversing the PTAB’s ruling. Moreover, in contrast to the earlier
posture of this case, in which there was a “reasonable likelihood” that
Plaintiffs’ patents would be invalidated, see 35 U.S.C. § 314(a), now that those
patents have survived IPR, there remains only a speculative possibility that
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the Federal Circuit will reverse the PTAB and invalidate them. Network-1
Security Solutions, Inc. v. Alcatel-Lucent USA Inc., CASE NO. 6:11cv492, 2015
WL 11439060, at *3 (E.D. Tex. Jan. 5, 2015). Thus, achieving further
simplification or additional guidance in this case is less likely at this stage
than it was previously.3
In this respect, the Court respectfully disagrees with the conclusion in
Safe Storage LLC v. Dell Inc., 12-cv-1264-GMS, slip op. at 5 n.1 (D. Del. Mar. 11,
2016), that the possibility of reversal at the Federal Circuit is sufficient to
warrant extension of a stay. More compelling are those courts which declined
to continue a stay for appeal to the Federal Circuit after considering the age
of the case and the diminishing likelihood that the stay would pay dividends
in simplification or expert guidance. See, e.g., Zipit Wireless Inc. v. Blackberry
Ltd., Civil Action No. 6:13-cv- 02959-JMC, 2016 WL 3452735, at *2–3 (D.S.C.
June 24, 2016); LG Electronics, Inc. v. Toshiba Samsung Storage Technology Korea
Corp., Civil Action No. 12-1063-LPS-CJB, 2015 WL 8674901, at *7 (D. Del. Dec.
11, 2015); ACQIS, LLC, 2016 WL 4250245, at *2–3.4

3

Furthermore, since the USPTO has ruled on all the pending IPRs, the Court
is now presented with an opportunity to make a clean break from those parallel
proceedings. See (Docket #129 at 7) (noting that it would unduly complicate matters
to lift the stay as to only two of the four Related Cases). Because the USPTO has
rendered final decisions in every IPR at issue here, there exists a level of finality
that distinguishes this case from cases like Evolutionary Intelligence, LLC v.
Livingsocial, Inc., Case No. 13-cv-04205-WHO, 2014 WL 2735185, at *1 (N.D. Cal.
June 6, 2014), and Princeton Digital Image Corp. v. Konami Digital Entertainment, Inc.,
Civil Action No. 12–1461–LPS–CJB, 2015 WL 219019, at *1 (D. Del. Jan. 14, 2015), in
which the USPTO had only just instituted IPR.
4

Additionally, the Court is unpersuaded by the decision to continue a stay
of litigation in In re Ameranth, No. 11-cv-1810 DMS, slip op. at 1 (S.D. Cal. Apr. 3,
2015). Although the case addressed the same procedural juncture as in this case, it
contains no analysis whatsoever of the factors underlying its decision.

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At this juncture, the most salient consideration is the prospect of
undue prejudice against Plaintiffs. The Court found in October that Plaintiffs
could wait a few more weeks for the final IPR decisions. (Docket #129 at 7–8).
Asking Plaintiffs to wait for another year or more is quite different,
particularly since this case has already been pending since 2014. See (Docket
#135 at 1–2). As such, this case is in a far different posture than Straight Path
IP Group, Inc. v. Verizon Communications Inc., 16-CV-4236 (AJN), 2016 WL
6094114, at *3 (S.D.N.Y. Oct. 18, 2016), a case which was only “in its infancy”
when the court found that a continued stay during appeal of an IPR decision
was warranted. Instead, the present case is more akin to Zoll Medical
Corporation v. Respironics, Inc., C.A. No. 12–1778–LPS, 2015 WL 4126741 (D.
Del. July 8, 2015), where the court denied a motion to stay in an identical
posture, reasoning that
[t]he present circumstances involve a patent infringement case
that has essentially been stalled for 2 ½ years, despite the
claims of the patent-in-suit having been confirmed in IPR and
despite the accused infringer being estopped from raising the
invalidity grounds it raised or reasonably could have raised in
the IPR. See 35 U.S.C. § 315(e)(2). The pendency of an appeal
from the IPR, and the possibility that the Federal Circuit may
reverse the PTO (and thereby simplify this litigation by,
presumably, making it disappear), is not, in and of itself, a
sufficient basis to make the patentee here continue to wait to
enforce patent rights that it currently holds. Continuing the
stay would unduly prejudice [the plaintiff] and unfairly
advantage [the defendant], in part by keeping this case at its
relatively early stage for perhaps up to another year, while the
appeal is briefed and decided.
Id. at *1; Network-1, 2015 WL 11439060, at *5 (finding unfair prejudice where
action had been pending nearly two years and exhaustion of appeals would
cause considerable additional delay). In light of its obligation to ensure the
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expeditious resolution of this case, see Fed. R. Civ. P. 1, the Court finds that
the stay in the Related Cases has outlived its usefulness. See Canady v. Erbe
Elektromedizin GmbH, 271 F. Supp. 2d 64, 75 (D.D.C. 2002) (“[T]he court may
abandon its imposed stay of litigation if the circumstances that persuaded the
court to impose the stay in the first place have changed significantly.”).
3.

CONCLUSION
The Court finds that, after analyzing the relevant factors, a continued

stay in this matter is unwarranted. As a result, Plaintiffs’ motion to lift the
stay will be granted.
Accordingly,
IT IS ORDERED that Plaintiffs’ motions to lift the stay:
14-CV-1288, Docket #79;
14-CV-1289, Docket #131;
14-CV-1295, Docket #102; and
14-CV-1296, Docket #106;
be and the same are hereby GRANTED.
An Amended Trial Scheduling Order follows.
Dated at Milwaukee, Wisconsin, this 30th day of December, 2016.
BY THE COURT:

J.P. Stadtmueller
U.S. District Judge

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