Case 2:15-cv-01774-RCJ-VCF Document 145 Filed 08/09/16 Page 1 of 5
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`UNITED STATES DISTRICT COURT
`DISTRICT OF NEVADA
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`RACING OPTICS, INC., a Nevada corporation,
`Case No. 2:15–cv–1774–RCJ–VCF
`Plaintiff,
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`ORDER
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`MOTION TO STAY (ECF NO. 95)
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`vs.
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`AEVOE CORP d/b/a MOSHI, a California
`corporation,
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`Defendant.
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`Before the court are Aevoe’s motion to stay (ECF No. 95), Racing Optics’s response (ECF No.
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`118), and Aevoe’s reply (ECF No. 131). For the reasons stated below, Aevoe’s motion is denied.
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`I. Background
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`On September 15, 2015, Racing Optics sued Aevoe for patent infringement. (ECF No. 1) The
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`action proceeded in the ordinary course. The parties participated in the required settlement conference,
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`began to construct claim charts, and exchanged discovery. This court has also resolved discovery
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`disputes that have arisen during the course of litigation.
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`On June 21, 2016, Aevoe filed three petitions for inter partes review with the U.S. Patent Office.
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`(ECF No. 95) Inter partes review is a parallel proceeding before the U.S. Patent Office. The office can
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`either find a party’s claim patentable or unpatentable. (Id.) Unpatentable claims must be dismissed
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`from this action. (Id.) The U.S. Patent Office uses a two-step procedure for inter partes review
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`petitions. (Id.) The office must first determine whether to institute proceedings i.e. whether to grant or
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`deny the petition for review. (Id.) If a petition for review is granted, the office then makes a final
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`determination regarding the patentability of the challenged claims. (Id.)
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`Aevoe now moves for a stay of this action due to its filings with the U.S. Patent Office.
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`Case 2:15-cv-01774-RCJ-VCF Document 145 Filed 08/09/16 Page 2 of 5
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`“The court may order a stay of litigation pending the outcome of a reexamination proceeding
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`II. Legal Standard
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`before the United States Patent and Trademark Office that concerns a patent at issue in the federal court
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`litigation.” LR 1-20. “Whether the court stays litigation upon the request of a party will depend on the
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`circumstances of each particular case, including without limitation: (1) whether a stay will unduly
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`prejudice or present a clear tactical disadvantage to the nonmoving party, (2) whether a stay will
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`simplify the issues in question and trial of the case, (3) whether discovery is complete, and (4) whether a
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`trial date has been set.” Id.
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`“[B]ecause the purpose of the stay procedure is efficiency, the court believes the best course of
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`action … where the [Patent Trials and Appeals Board] has not yet determined whether to grant pending
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`petitions for review, is to treat the first and fourth factors as indeterminable and deny the stay motion
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`unless the second and third factors strongly support a stay even in the absence of the first and fourth
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`factors.” Unwired Planet, LLC v. Square, Inc., No. 3:13-cv-579-RCJ-WGC, 2014 WL 4966033 at* 4
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`(D.Nev. Oct. 3, 2014)
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`1.
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`The Circumstances of This Action Do Not Warrant a Stay
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`III. Discussion
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`i.
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`A Stay Will Prejudice Racing Optics
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`Racing Optics argues that a stay would prejudice the company because it continues to lose
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`market share and good will as this action is litigated and because it has already expended considerable
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`time and effort to litigate three successive discovery motions. (ECF No. 118) This court agrees that
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`Racing Optics will be prejudiced by a stay.
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`This action was originally filed in September 2015. (ECF No. 1) Ten months and three
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`extensive discovery motion later, Aevoe moved for a stay of this action. (ECF No. 95) Had Aevoe
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`Case 2:15-cv-01774-RCJ-VCF Document 145 Filed 08/09/16 Page 3 of 5
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`moved for a stay at the beginning of this action, Racing Optics would likely have been disappointed in
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`the delay in adjudication, but it probably would not have suffered any prejudice. But Aevoe filed its
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`motion to stay eleven months after Racing Optics initiated this action. (Id.) In the intervening time that
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`parties have exchanged substantial amounts of discovery, this court has resolved three contentious
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`discovery motions, and the district judge has denied Racing Optics’s motion for judgment on the
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`pleadings. Racing Optics has already invested significant time, money, and effort in this action. It
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`would undoubtedly be prejudiced if this action were stayed pending a decision from the U.S. Patent
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`Office. The first factor weighs heavily against a stay.
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`ii.
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`This Court Cannot Determine Whether a Stay Will Simplify the Issues
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`On June 21, 2016, Aevoe filed petitions for inter partes review with the U.S. Patent Office.
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`(ECF No. 95) Aevoe’s petitions challenge the patentability of three of the four Asserted Patents.1 (Id.)
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`As of August 9, 2016, the U.S. Patent Office has not yet decided whether to initiate proceedings on the
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`three challenged patents. (Id.) Under 35 U.S.C. § 314(b) and § 316(a)(11), the U.S. Patent Office must
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`decide whether to institute proceedings on Aevoe’s petitions by December 21, 2016, and must issue a
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`final determination on any instituted proceedings by December 21, 2017. Aevoe believes that it will
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`prevail on inter partes review. (Id.) Consequently, the number of patents and claims the court will need
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`to adjudicate will be significantly narrowed after the U.S. Patent Office proceedings have concluded.
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`In support of its argument, Aevoe submitted statistical data that showed a 48% chance of a
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`petition for inter partes review being granted and a 72% chance of an instituted claim being found
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`unpatentable. (ECF No. 95) Aevoe’s supporting data amounts to statistical speculation about its
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`1 Aevoe represents that if the court denied its motion for judgment on the pleadings, it would seek inter partes review on the
`remaining Asserted Patent. (ECF No. 95 at 2 n. 1) On August 2, 2016, the court denied Aevoe’s motion for judgment on the
`pleadings. (ECF No. 139) For the purposes of this motion, this court will assume Aevoe has filed or will file a petition for
`inter partes review of the remaining Asserted Patent.
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`Case 2:15-cv-01774-RCJ-VCF Document 145 Filed 08/09/16 Page 4 of 5
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`chances of convincing the U.S. Patent Office to institute proceedings and invalidate Racing Optics’s
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`patents. These statistics do not allow this court to draw any conclusions about Aevoe’s chances of
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`getting proceedings instituted or getting Racing Optics’s patents invalidated. See Unwired Planet, LLC,
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`2014 WL 4966033, at *4. (“Before the [Patent Trials and Appeals Board] has decided whether to grant a
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`petition for review, however, it is very difficult to assess whether a stay would simplify the issues or
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`reduce the burden of litigation.”).
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`Given the difficulty of forecasting the U.S. Patent Office’s decisions on Racing Optics’s claims
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`and the substantial discovery that has already been exchanged regarding those claims, the second factor,
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`under these circumstances, weighs against a stay. See id.
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`iii.
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`Discovery is Incomplete and No Trial Date Has Been Set
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`The need to complete discovery and the absence of a trial date weigh in favor of a stay.
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`Applications in Internet Time, LLC v. Salesforce.com, Inc., No. 3:13-cv-628-RCJ-VPC, 2015 WL
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`8041794 at* 3 (D.Nev. Dec. 4, 2015). Fact discovery is scheduled to close on December 16, 2016 and
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`no trial date has been set in this action. (ECF No. 76) The third and fourth factors therefore weigh in
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`favor of a stay.
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`IV. Conclusion
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`Since the first and fourth factors are treated as indeterminable, this court focuses on the second
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`and third factors. See Unwired Planet, LLC, 2014 WL 4966033, at *5. Neither factor strongly supports
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`a stay. See id.
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`ACCORDINGLY, and for good cause shown,
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`/// /// ///
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`Case 2:15-cv-01774-RCJ-VCF Document 145 Filed 08/09/16 Page 5 of 5
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`IT IS HEREBY ORDERED that Aevoe’s motion to stay (ECF No. 95) is DENIED.
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`IT IS SO ORDERED.
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`DATED this 9th day of August, 2016.
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`_________________________
`CAM FERENBACH
`UNITED STATES MAGISTRATE JUDGE
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