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Lighting Science Group Corp. v. Nicor, Inc.

United States District Court, M.D. Florida, Orlando Division

May 9, 2017

LIGHTING SCIENCE GROUP CORPORATION, Plaintiff/Counter-Defendant,
v.
NICOR, INC., Defendant/Counter-Claimant. LIGHTING SCIENCE GROUP CORPORATION, Plaintiff/Counter-Defendant,
v.
AMERICAN DE ROSA LAMPARTS, LLC, Defendant/Counter-Claimant. LIGHTING SCIENCE GROUP CORPORATION, Plaintiff,
v.
TECHNICAL CONSUMER PRODUCTS, INC., Defendant. LIGHTING SCIENCE GROUP CORPORATION, Plaintiff/Counter-Defendant,
v.
SATCO PRODUCTS, INC., Defendant/Counter-Claimant. LIGHTING SCIENCE GROUP CORPORATION, Plaintiff,
v.
AMAX LIGHTING, Defendant.

          ORDER

          Roy B. Dalton Jr. Judge.

         The five patent infringement actions identified above (“Related Actions”)-each initiated seriatim by Plaintiff Lighting Science Group Corporation (“Lighting Science”)-are before the Court upon consideration of the following identical documents filed in each Related Action: (1) Defendants' Motions to Stay Litigation Pending Inter Partes Review and Incorporated Memorandum in Support (“Stay Motions”), filed February 27, 2017;[1] (2) Plaintiff's Memoranda in Opposition to Defendants' Motions to Stay Litigation (“Responses”), filed March 10, 2017;[2] (3) Defendants' Replies in Support of Motion to Stay Litigation Pending Inter Partes Review and Incorporated Memoranda in Support (“Replies”), filed March 27, 2017;[3] and (4) Plaintiff's Surreplies in Support of Opposition to Motion to Stay Litigation Pending Inter Partes Review and Incorporated Memorandum of Law in Opposition (“Surreplies”), filed May 1, 2017.[4]

         I. Background

         In these Related Actions, Lighting Science claims that its competitors in the LED lighting market-Nicor, Inc. (“Nicor”), American De Rosa Lamparts, LLC (“ADRL”), Technical Consumer Products, Inc. (“TCPI”), Satco Products, Inc. (“Satco”), and Amax Lighting (“Amax”)-are infringing certain claims (“Asserted Claims”) of three of Plaintiff's registered patents (“Patents-in-Suit”)-U.S. Patent No. 8, 201, 968 (“‘968 Patent”), U.S. Patent No. 8, 672, 518 (“‘518 Patent”), and U.S. Patent No. 8, 967, 844 (“‘844 Patent”).[5]

         By asserting counterclaims and affirmative defenses in these actions, [6] and by filing petitions with the Patent Trial and Appeal Board (“PTAB”) on April 17, 2017 (“Petitions”), for inter partes review (“IPR”) in accordance with new procedures set forth in the Leahy-Smith America Invents Act (“AIA”), 35 U.S.C. §§ 311-319, each of the Defendants have challenged the validity of the Asserted Claims.[7] Based on their Petitions, and the fact that the PTAB previously instituted IPRs with respect to claims of the ‘968 and ‘844 Patents, [8] the Defendants request that the Court stay these proceedings pending further action by the PTAB. (See supra nn.1, 3.) Lighting Science opposes the Stay Motions (see supra nn.2, 4), and the matter is ripe for adjudication.

         II. Discussion

         Under the AIA, IPR presents “a new system for reviewing issued patents, providing for stays of district court proceedings, and estoppels in tribunals, based on” expedited decisions of the Patent and Trademark Office (“PTO”).[9] See SAD Inst., Inc. v. ComplementSoft, LLC, 825 F.3d 1341, 1353-54 (Fed. Cir. 2016) (Newman, J., concurring in part & dissenting in part). In the two-stage IPR proceeding:

(1) the PTAB first reviews the IPR petition and any preliminary response, and makes its decision-which is not subject to appeal-whether “there is a reasonable likelihood that the petitioner would prevail with respect to at least 1 of the claims challenged in the petition” based on prior art (see Synopsys, Inc. v. Mentor Graphics Corp., 814 F.3d 1309, 1314 (Fed. Cir. 2016) (quoting 35 U.S.C. § 314(a))); and
(2) the PTAB then conducts the IPR and-based on a fulsome administrative record-issues a final written decision with respect to “any patent claim challenged by the petitioner” (see id. (quoting 35 U.S.C. § 318(a)).

         When IPRs are sought, the decision to stay related civil patent infringement litigation is within the sound discretion of the district court. See Auto. Mfg. Sys., Inc. v. Primera Tech., Inc., No. 6:12-cv-1727-Orl-37DAB, 2012 WL 6133763, at *1 (M.D. Fla. Nov. 21, 2013). Non-exclusive factors pertinent to the exercise of such discretion include: (1) the procedural posture of the litigation, including whether discovery is complete and a trial date is set (“Procedural Posture Factor”); (2) whether the stay will simplify issues in the dispute between the litigants (“Simplification Factor”); and (3) whether the stay will unduly prejudice or present a clear tactical disadvantage to the nonmoving party (“Prejudice Factor”). See id.[10]

         Here, the totality of the circumstances weigh in favor of entering a stay. First, the procedural posture of the Related Actions is not advanced. The oldest Related Action was filed on March 10, 2016 (see Nicor Action, at Doc. 1), the newest was filed on July 22, 2016 (see Amax Action, at Doc. 1), and-due the amendment of pleadings, an initial lack of diligence, [11] various requests for extensions of time, and the necessity of consolidating the Related Actions to conserve resources-discovery is far from complete, the Court has not conducted a claim construction hearing, the claim construction issues are not fully briefed, and the trial dates are not yet set.[12] Thus, the Procedural Posture Factor weighs in favor of entering a stay.

         Given the pending invalidity counterclaims and affirmative defenses (see supra note 6), there is little doubt that input from the PTO will facilitate the resolution of these proceedings. Hence the Simplification Factor also weighs strongly in favor of entering a stay. See Primera Tech., 2013 WL 6133763, at *4 (noting the varied benefits that may result from IPRs even when no claims are invalidated).

         Finally, the Prejudice Factor weighs somewhat against entry of a stay, but it is not determinative here because Lighting Science's litigation choices do not demonstrate any particular sense of urgency. See Andersons, 2014 WL 4059886, at *3 (rejecting argument that stay was inappropriate because the parties were competitors); see also VirtualAgility Inc. v. Salesforce.com, Inc., 759 F.3d 1307, 1318-19 (Fed. Cir. 2014) (reversing denial of stay where district court gave undue weight to parties' status as competitors). ...


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