A decision to stay patent infringement litigation falls within a federal court’s power to control its docket. But in determining whether to stay litigation pending the Patent Office’s inter partes review (IPR) of the patent, courts still are guided by three factors: (1) whether the stay will simplify the litigation, (2) whether a stay would unduly prejudice (or present a clear tactical disadvantage to) the patent owner, and (3) whether the litigation has progressed to some advanced stage (e.g., discovery is complete, a trial date is set, etc.). Yet since the Supreme Court’s 2018 decision in SAS Institute Inc. v. Iancu, 138 S. Ct. 1348 (2018) (discussed here), courts in the Eastern District of Texas have erected an unnecessarily high bar for stay-movants to leap.
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Stays
Does Section 285 Permit an Award of Attorney’s Fees for Patent Office Proceedings?
Back in 1988, the Federal Circuit reversed a district court decision that refused to award a party its reasonable attorney’s fees incurred in successfully litigating a patent’s validity before the Patent Office. PPG Indus., Inc. v. Celanese Polymer Specialties Co., 840 F.2d 1565 (Fed. Cir. 1988). The Office determined that the patent asserted in litigation—stayed pending the Office’s review—was invalid and obtained through inequitable conduct. Nobody contested the district court’s conclusion that the case was exceptional.
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The Arthrex Mulligan
The Federal Circuit, in Arthrex, concluded that the Patent and Trial Appeal Board’s Administrative Patent Judges were unconstitutionally appointed “principal” officers. The court therefore vacated the Board’s decision that canceled claims in an inter partes review and remanded so a new panel of APJs would re-decide the patentability of the claims. What happens, however, when the Board’s pre-Arthrex final written decision does not cancel—but rather upholds the patentability of—the challenged claims? Well, there’s an appeal for that.
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Should I Stay or Should I Go? – Co-Pending IPR and Litigation Can Lead to Discovery Obligations
Fighting a war on two fronts is rarely an enviable strategic position. While district court judges do not always grant stays of patent infringement cases until resolution of co-pending inter partes reviews (IPR’s), accused infringers considering whether to request a stay of litigation should note the PTAB’s February 28, 2018, Order in Becton, Dickinson and Company v. B. Braun Melsungen AG, IPR2017-01586, -01587, -01588, -01589, and -01590.
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Enactment of the STRONGER Patents Act Would Severely Limit PTAB Proceedings
The STRONGER (Support Technology & Research for Our Nation’s Growth and Economic Resilience) Patents Act of 2017 was recently introduced in the Senate. The Act is an updated version of the STRONG Patents Act of 2015 that stalled in Congress. Like its predecessor, the STRONGER Patents Act is designed to significantly modify the AIA trial proceedings at the PTAB. Enactment of this Act would severely diminish the usefulness of AIA proceedings.
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Trial Verdict Means Time Has Run Out to Get a Stay
Federal district courts are inclined to stay patent litigations when requested by patent challengers on the basis that the patent-in-suit is undergoing an AIA review proceeding at the USPTO; and those not so inclined, specifically in the Eastern District of Texas, have been corrected by the Federal Circuit. But this favorable disposition toward stays occurs only up to a point. That point appears to be when the trial verdict has been rendered – even if that verdict is contrary to the PTAB’s determination.
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