Apple, Inc. v. Samsung Elecs. Co.
| Decision Date | 25 November 2013 |
| Docket Number | Case No.: 11-CV-01846-LHK |
| Parties | APPLE, INC., a California corporation, Plaintiff, v. SAMSUNG ELECTRONICS CO., LTD., a Korean corporation; SAMSUNG ELECTRONICS AMERICA, INC., a New York corporation; SAMSUNG TELECOMMUNICATIONS AMERICA, LLC, a Delaware limited liability company, Defendants. |
| Court | U.S. District Court — Northern District of California |
EMERGENCY RENEWED MOTION
FOR STAY PENDING
REEXAMINATION OF U.S. PATENT
Samsung has filed an emergency motion to stay all proceedings in this case pending the ex parte reexamination of U.S. Patent No. 7,844,915 (the '915 patent). ECF No. 2811("Mot.") at 1. As part of that reexamination, and triggering Samsung's instant motion, the United States Patent and Trademark Office ("PTO") issued an Advisory Action affirming the final rejection of all claims of the arguments and briefing, and the record in this case, the Court agrees with Apple and DENIES Samsung's renewed motion for a stay.1
The Federal Circuit has held 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 examination." Ethicon, Inc. v. Quigg, 849 F.2d 1422, 1426-27 (Fed. Cir. 1988) (citation omitted). While courts are not required to stay judicial proceedings pending re-examination of a patent, see Viskase Corp. v. Am. Nat'l Can. Co., 261 F.3d 1316 (Fed. Cir. 2001), a stay for purposes of re-examination is within the district court's discretion, see, e.g., Patlex Corp v. Mossinghoff, 758 F.2d 594, 603 (Fed. Cir. 1985). In determining whether to stay a case pending re-examination, the Court considers the following factors: (1) whether discovery is complete and whether a trial date has been set; (2) whether a stay will simplify the issues in question and trial of the case; and (3) whether a stay would unduly prejudice or present a clear tactical disadvantage to the nonmoving party. Telemac Corp. v. Teledigital, Inc., 450 F.Supp.2d 1107, 1111 (N.D. Cal. 2006). The Court discusses each of these factors below, and concludes that all three factors in this case weigh against granting a stay.
Before considering the three factors, the Court first discusses the stage of the patent reexamination proceedings in order to provide some necessary context. On July 26, 2013, the PTO Examiner issued a Final Office Action rejecting all claims of the '915 patent as invalid. ECF No. 2349-1 at 4. Apple filed a response to the Final Office Action on October 28, 2013. ECF No. 2614-1 at 3. On November 20, 2013, the PTO examiner issued an "Advisory Action" noting that Apple's "proposed response . . . fails to overcome all of the rejections in the Final Rejection," and maintaining its position that all claims of the '915 patent are invalid. ECF No. 2810 at 4. Apple asserts that at this point in time, Apple still has time to file a second response to the Final Office Action, for consideration by the Examiner, because as the Advisory Action states, "[t]he Period for response is extended to run 5 months from the mailing date of the final rejection," id. at 4, and the final rejection was mailed on July 26, 2013. Apple is correct that it is entitled to file a response to a "final" rejection within the period allowed for response, and that the response may still result in the Examiner's withdrawal of the rejection or allowance/certification of the claims under reexamination. See 37 C.F.R. § 1.116. Further, Apple still has the option to appeal the Examiner's decision to the Patent Trial and Appeal Board ("PTAB"). See 35 U.S.C. § 134(b) () It is not yet clear how long Apple will have to file a notice of appeal to the PTAB, but it is typically a period of two months. See Manual of Patent Examining Procedure 2273 ("The period for filing the notice of appeal is the period set for response in the last Office action which is normally 2 months.") Apple may also then appeal any adverse PTAB decision to the Federal Circuit. See 35 U.S.C. § 141 () Apple will have two months from the date of the PTAB decision to file a notice of appeal from the PTAB to the Federal Circuit. See 37 C.F.R. § 1.304(a)(1). The PTO will issue a certificate canceling any claim of the '915 patent determined to be unpatentable only after the time for appeal has expired or any appeal proceeding has terminated. See 35 U.S.C. § 307(a).
The Court now provides an overview of the litigation in this case to provide further necessary context before considering the relevant stay factors. As all parties are aware, this case has a long procedural history, starting with the filing of Apple's original complaint against Samsung in April 2011. In December 2011, this Court declined to enter a preliminary injunctionprohibiting Samsung from selling Samsung products which Apple claimed infringed Apple's D'087, D'677, '381 and D'889 patents. See ECF No. 452. The Federal Circuit reviewed that decision, affirming the denial of a preliminary injunction with respect to the D'087, D'677, and '381 patents but vacating the denial of injunctive relief and remanding the case for further proceedings with respect to the D'889 patent. Apple, Inc. v. Samsung Electronics Co., 678 F.3d 1314 (Fed. Cir. 2012). Specifically, the Federal Circuit ordered this Court to consider the balance of hardships and whether the public interest favored an injunction with respect to the D'889 patent. Id. at 1333.2
The case proceeded to trial in August 2012, where a jury found that twenty-six Samsung smartphones and tablets infringed one or more of six Apple patents, namely the D 3 4 post-trial motions and issued nine separate orders, including a ruling on Apple's motion to permanently enjoin Samsung from importing or selling any of its twenty-six infringing smartphones and tablets. Apple also sought to enjoin Samsung from selling any of its six smartphones found to dilute Apple's trade dress. This Court denied Apple's request for the permanent injunction. See ECF No. 2197. The Federal Circuit has reviewed that permanent injunction decision and has already issued a ruling. See Apple v. Samsung Electronics Co., --- F.3d --- (2013), 2013 WL 6050986 (Fed. Cir. 2013). The Federal Circuit affirmed the denial of injunctive relief with respect to Apple's design patents, but vacated this Court's denial of injunctive relief with respect to Apple's utility patents and remanded for reconsideration.
On March 1, 2013, this Court also issued an order granting a partial retrial in this case limited to the issue of damages for certain products and patents at issue in the 2012 trial. ECF No. 2271. The purpose of the retrial was to determine damages for a narrower subset of products and patents based on corrected dates on which Samsung first had notice that its products infringed Apple's intellectual property and thus became liable for infringement damages under 35 U.S.C. § 287(a). The Court recently held that retrial, from November 12, 2013 to November 19, 2013, and the jury delivered its verdict on November 21, 2013, after deliberating for three days. ECF No. 2822 (jury verdict).
Given this procedural context, the Court now assesses each of the factors for granting a stay, and finds that all factors weigh against granting a stay in this case. The first factor is the stage of the proceedings, where the Court is to consider "whether discovery is complete and whether a trial date has been set." Telemac Corp., 450 F.Supp.2d at 1111. The Court finds that this factor weighs heavily in favor of Apple. The Court agrees with Samsung that "the stage of the case is not considered in a vacuum," Mot. at 3. As the procedural history set forth above indicates, this case has reached a stage far beyond discovery, dispositive motions, or the mere setting of a trial date. See Telemac Corp., 450 F.Supp.2d at 1111 (). This Court has already conducted not only one but two trials with respect to the patents at issue in this case, and has already issued nine orders on post-trial motions concerning the 2012 trial. The Federal Circuit has already reviewed one of those post-trial motion rulings. See Apple v. Samsung Electronics Co., --- F.3d --- (2013), 2013 WL 6050986 (Fed. Cir. 2013) (). Given the advanced stage of this case, this factor favors Apple. See Orion IP, LLC v. Mercedes-Benz USA, LLC, No. 6:05 CV 322, 2008 WL 5378040, at *8 (E.D. Tex. Dec. 22, 2008) ( ), rev'd on other grounds, 605 F.3d 967 (Fed....
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