Parties sometimes think that a stay pending an instituted IPR is almost a given. But while a stay is more likely than not, it's not a sure thing.
Last month we saw a even a stipulated stay pending IPR denied by visiting Judge Choe-Groves (in the time since, by the way, that denial has held firm, and the Court issued a scheduling order).
This week Judge Fallon denied a stay pending an instituted IPR in North Atlantic Imports, LLC v. Loco-Crazy Good Cookers, Inc., C.A. No. 23-999-GBW-SRF (D. Del. Nov. 19, 2024). The Court noted that there were non-patent claims pending that would not be simplified by the stay—even though the defendant alleged those claims were weak, and were added specifically to avoid a stay:
Simplification of issues. The first factor, which is considered "[t]he most important factor bearing on whether to grant a stay," weighs against the entry of a stay. . . . Blackstone's false advertising, deceptive trade practices, and false marking claims will not be narrowed or eliminated when the PTAB issues a final written decision on the instituted claims of the '473 patent. . . . Defendant speculates that these three causes of action "are substantively weak and were likely appended to this patent case in an effort to avoid a stay." . . . Regardless, the claims survived the pleading stage and they remain a part of the case.
Id. at 4. If the claims were appended to help avoid a stay, it worked. The Court found that the simplification factor favored denial.
Plaintiff was helped further by the fact that the case had progressed a bit. The parties had already filed their claim construction briefs, and there was only a single disputed term due to be argued at the pending Markman hearing:
Staying the case now will also not meaningfully preserve resources on claim construction because the parties' exchange of briefing is complete. . . . Proceeding with the Markman hearing on a single disputed claim term is not overly burdensome for the parties or the court. . . . Moreover, the court's resolution of the parties' claim construction dispute will not be cumulative of the PTAB's efforts because Defendant raised no claim construction issues in its IPR petition.
Even better for plaintiff, the parties are competitors—even if the plaintiff's products don't practice the asserted patent:
The relationship of the parties weighs against a stay because Blackstone and Defendant are direct competitors in the market for propane griddles. "[When the parties are direct competitors, there is a reasonable chance that delay in adjudicating the alleged infringement will have outsized consequences to the party asserting infringement has occurred, including the potential for loss of market share and an erosion of goodwill." SenoRx, Inc. v. Hologic, Inc., C.A. No. 12-173-LPS-CJB, 2013 WL 144255, at *8 (D. Del. Jan. 11, 2013). . . . The court is not persuaded by Defendant's attempt to characterize Blackstone as a non-practicing entity because Blackstone's products do not practice the '473 patent. . . . Defendant acknowledges that the parties "compete in the propane griddle industry generally[.]"
Id. at 7-8. Ultimately, the Court denied the stay entirely.
There are a few easy takeaways here:
- Asserting even weak non-patent claims can help avoid a stay if the defendant files an IPR.
- Stays are less likely in competitor cases.
- A case can be a competitor case even if the plaintiff does not practice the patent.
- If you're a defendant, get your IPR in early, and move to stay as soon as it's instituted (possibly earlier).
None of that is likely news for practiced patent litigators and regular readers of IP/DE, but it never hurts to have a reminder of where things are. Think of this post next time you hear that a defendant "will definitely get a stay if the PTAB institutes the IPR"....
If you enjoyed this post, consider subscribing to receive free e-mail updates about new posts.
