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GmbH v. Flir Systems, Inc.

United States District Court, D. Oregon

December 18, 2017

GARMIN SWITZERLAND GMBH, a Swiss Limited Liability Company, and GARMIN CORPORATION, a Taiwan Corporation, Plaintiffs,
v.
FLIR SYSTEMS, INC., an Oregon corporation, and FLIR MARITIME US, INC. f/k/a RAYMARINE, INC., a Delaware corporation, Defendants.

          OPINION AND ORDER

          STACIE F. BECKERMAN UNITED STATES MAGISTRATE JUDGE

         Garmin Switzerland GmbH and Garmin Corporation (collectively “Garmin”) filed a complaint against FLIR Systems, Inc. and FLIR Maritime US, Inc., f/k/a Raymarine, Inc., (collectively “FLIR”) for patent infringement. Garmin alleges that FLIR makes, uses, sells, and offers to sell a marine guidance system that infringes Garmin's United States (“U.S.”) Patent Nos. 7, 268, 703 (“the '703 patent”) and 6, 459, 987 (“the '987 patent”).

         FLIR moves for an order staying all discovery pending the Court's resolution of FLIR's Motion to Dismiss the Complaint. (ECF No. 40.) Alternatively, in the event the Court denies FLIR's motion to dismiss, FLIR moves for an order staying the proceedings entirely until the U.S. Patent Trial and Appeal Board (“PTAB”) concludes its already instituted inter partes review (“IPR”) of the '703 patent. (Defs.' Mot. Stay 1.) Garmin opposes FLIR's request to stay discovery pending a ruling on the motion to dismiss and FLIR's alternative request to stay the proceedings pending an IPR review of the '703 patent. Garmin argues that if the Court is inclined to stay all proceedings pending the IPR review, it should do so immediately, i.e., before ruling on FLIR's motion to dismiss. (Pls.' Opp. 12.) For the following reasons, the Court grants FLIR's Motion to Stay Pending FLIR's Motion to Dismiss and Instituted IPR Proceeding (ECF No. 49), and orders an immediate stay of all proceedings in this Court. This Court denies as moot FLIR's motion to stay discovery.

         I.STAY OF ALL PROCEEDINGS PENDING THE INSTITUTED IPR REVIEW

         A. IPR Review

         Under the Leahy-Smith America Invents Act (“AIA”), Pub. L. No. 112-29, 125 Stat. 284 (2011) (codified in various sections of Title 35 of the United States Code), any “person who is not the owner of a patent may file with the [PTAB] a petition to institute an inter partes review of the patent.” 35 U.S.C. § 311(a); see also Drink Tanks Corp. v. GrowlerWerks, Inc., 3:16-cv-00410-SI, 2017 WL 2633389, at *1 (D. Or. June 19, 2017) (explaining the new IPR process, including the legislative intent “to minimize duplicative efforts by increasing coordination between district court litigation and inter partes review” (quotations and citation omitted)). Petitioners such as FLIR “may request to cancel as unpatentable 1 or more claims of a patent only on a ground that could be raised under section 102 or 103 relating to invalidity of the patent or any claim on the basis of prior art.” 2017 WL 2633389, at *1 (quoting § 311(b) (brackets and quotations omitted)). If the PTAB determines that the petition presents “a reasonable likelihood that the petitioner would prevail with respect to at least 1 of the claims challenged in the petition” the PTAB may institute the IPR process. Id. at § 314(a).

         On February 16, 2017, FLIR submitted a “Petition for Inter Partes Review of U.S. Patent No. 7, 268, 703” to the PTAB, seeking cancellation of 29 patent claims on the ground that the challenged claims were invalid because the method employed to calculate navigational routes was known before the '703 patent filing date. (Stephen P. Bosco Decl. Ex. A, Sept. 29, 2017.) On June 13, 2017, Garmin filed a preliminary response in opposition to FLIR's petition. (Bosco Decl. Ex. B.) On August 10, 2017, the PTAB found that FLIR had demonstrated “a reasonable likelihood of prevailing on its challenges to claims 1-7, 12-23, 25-29, and 41-45 of the '703 patent” and accordingly instituted the IPR process. (Bosco Decl. Ex. C at 33.) Oral argument before the PTAB on the IPR is scheduled for April 11, 2018, and a final written decision on the patentability of the claims will issue by August 2018. (Bosco Decl. Ex. D at 6; Defs.' Mot. Stay 15 (“By statute, a final written decision as to the unpatentability of the claims will issue by August 2018.”).)

         B. Legal Standard

         When deciding whether to stay a proceeding pending the IPR process, courts apply a three-part test, asking whether: (1) “discovery is complete and whether a trial date has been set, ” (2) “a stay will simplify the issues in question and trial of the case, ” and (3) “a stay would unduly prejudice or present a clear tactical disadvantage to the non-moving party.” Drink Tanks Corp., 2017 WL 2633389, at *2. Based on these factors, the court must determine whether “the benefits of a stay outweigh the inherent costs” of delaying the litigation. EchoStar Tech. Corp. v. TiVo, Inc., 5:05-cv-81-DF, 2006 WL 2501494, at *1 (E.D. Tex. July 14, 2006).

         C. Analysis

         In the event the Court denies its motion to dismiss, FLIR asks the Court to stay the proceedings entirely pending the instituted IPR of the '703 patent. (Defs.' Mot. Stay 1.) Garmin opposes a stay pending IPR review following the Court's ruling on FLIR's motion to dismiss, but argues that if the Court is inclined to stay all proceedings pending the IPR review, it should do so immediately. (Pls.' Opp. 12.) As explained below, the Court finds that a balance of the factors the Court must consider in determining whether to grant a stay pending the IPR favors an immediate stay of all proceedings in this case.

         1. Stage of the Litigation

         Garmin filed its complaint on July 24, 2017. In lieu of an answer, FLIR filed a motion to dismiss on August 22, 2017. On September 29, 2017, simultaneous with filing its reply brief on the motion to dismiss, FLIR filed a motion to stay the proceedings. See VirtualAgility Inc. v. Salesforce.com, Inc., 759 F.3d 1307, 1316 (Fed. Cir. 2014) (“[D]istrict courts have adopted the date of the filing of the motion to stay' as the “proper time to measure the stage of litigation.”). Although the parties participated in a Rule 26(f) conference in late September, discovery has not started and FLIR has not yet filed an answer.

         Garmin does not dispute FLIR's characterization that “the case has barely begun.” (Defs.' Mot. Stay 9; Pls.' Opp. 11 (“Garmin does not dispute that this case is in its early stages.”); see also Defs.' Mot. Stay 15 (“The relative infancy of this proceeding, moreover, stands in sharp contrast to the already far more advanced proceedings under way at the PTAB.”).) This case is in the early stage of litigation. The parties filed a Joint Rule 26(f) Report and Proposed Case Schedule with two sets of proposed dates-one schedule in the event a stay is granted and one schedule in the event a stay is denied. (ECF No. 51.) See Robert Bosch Healthcare Sys., Inc. v. Cardiocom, LLC, No. C-14-1575 EMC, 2014 WL 3107447, at *4 (N.D. Cal. July 3, 2014) (“Where discovery has not yet been completed and a trial date has not been set, courts are more likely to issue stays to save the parties and the Court the ...


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