Case 1:16-cv-03852-JPO Document 75 Filed 09/16/16 Page 1 of 11
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`16-CV-3852 (JPO)
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`OPINION AND ORDER
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`Plaintiffs,
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`J. PAUL OETKEN, District Judge:
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`Plaintiffs filed a motion for preliminary injunction on June 1, 2016, and a letter motion
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`for a stay pending a concurrent action in the International Trade Commission (“ITC”) on June
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`22, 2016. Defendants filed a motion to dismiss, or alternatively, to stay or transfer on June 10,
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`2016. A preliminary injunction hearing on this matter was held on July 12, 2016. For the
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`reasons that follow, Plaintiffs’ motion for a preliminary injunction is denied, Defendants’ motion
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`is granted to the extent that it requests a stay, and Plaintiff’s letter motion to stay is denied as
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`moot.
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`I.
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`Background
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`Plaintiffs are Comcast Corporation; Comcast Cable Communications, LLC; Comcast
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`Cable Communications Management, LLC; Comcast of Houston, LLC; Comcast Business
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`Communications, LLC; Comcast Holdings Corporation; Comcast Shared Services LLC; and
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`1
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`UNITED STATES DISTRICT COURT
`SOUTHERN DISTRICT OF NEW YORK
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`COMCAST CORPORATION, COMCAST
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`CABLE COMMUNICATIONS, LLC,
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`COMCAST CABLE COMMUNICATIONS
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`MANAGEMENT, LLC, COMCAST OF
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`HOUSTON, LLC, COMCAST BUSINESS
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`COMMUNICATIONS, LLC, COMCAST
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`HOLDINGS CORPORATION, COMCAST
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`SHARED SERVICES, LLC, and COMCAST
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`STB SOFTWARE I, LLC,
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`Defendants.
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`------------------------------------------------------------- X
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`-v-
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`ROVI CORPORATION, ROVI GUIDES, INC.,
`ROVI TECHNOLOGIES CORP., and VEVEO,
`INC.,
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`Case 1:16-cv-03852-JPO Document 75 Filed 09/16/16 Page 2 of 11
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`Comcast STB Software I, LLC (collectively, “Comcast”). They filed this action for breach of
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`contract and declaratory judgment of patent noninfringement against Rovi Corporation; Rovi
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`Guides, Inc.; Rovi Technologies Corp.; and Veveo, Inc. (collectively, “Rovi”) on May 23, 2016.
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`(Dkt. No. 1.) Before Comcast commenced the present action, Rovi filed two complaints against
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`Comcast for patent infringement in the Eastern District of Texas (“EDTX”), both on April 1,
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`2016. Rovi, et al. v. Comcast Corp., et al., No. 2:16-cv-00321-JRG-RSP (E.D. Tex. Apr. 1,
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`2016); Rovi, et al. v. Comcast Corp., et al., No. 2:16-cv-00322-JRG-RSP (E.D. Tex. Apr. 1,
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`2016). Rovi also filed one action with the ITC. In the Matter of Certain Digital Video Receivers
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`and Hardware and Software Components Thereof, Inv. No. 337-TA-1001 (ITC Apr. 6, 2016).
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`The declaratory relief of noninfringement sought by Comcast in this action relates to the same
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`fifteen patents at issue in the cases filed in the EDTX and ITC actions. Comcast’s complaint
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`further asserts state law breach of contract claims and the defenses of express license, implied
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`license, and patent exhaustion. (Dkt. No. 1.)
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`Comcast’s motion for a preliminary injunction is based on the forum selection clauses in
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`two separate licensing agreements between Comcast and Rovi. Comcast argues that these
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`clauses mandate that all of the actions described above be litigated exclusively in New York state
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`or federal courts. In its pending motion for preliminary injunction, Comcast asks this Court to
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`enjoin Rovi from continuing to prosecute its infringement actions in the EDTX and ITC, and to
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`order Rovi to terminate those actions. (Dkt. No. 25.) For its part, Rovi seeks to dismiss, or
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`alternatively, to stay or transfer this action to the EDTX based on its view that the law directs
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`that this Court defer resolution of substantially similar matters to the first-filed forum. (Dkt. No.
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`49). Finally, Comcast has filed an unopposed letter motion to stay the overlapping patent
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`2
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`Case 1:16-cv-03852-JPO Document 75 Filed 09/16/16 Page 3 of 11
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`infringement action until the ITC action is terminated or finalized pursuant to 28 U.S.C.
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`§ 1659(a).1 (Dkt. No. 57.)
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`II.
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`Legal Standards
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`A.
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`The “First-to-File” Rule
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`In a patent case, this Court looks to the law of the Court of Appeals for the Federal
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`Circuit in applying the first-to-file rule. See Futurewei Techs., Inc. v. Acacia Research Corp.,
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`737 F.3d 704, 708 (Fed. Cir. 2013) (“Resolution of whether the second-filed action should
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`proceed presents a question sufficiently tied to patent law that the question is governed by this
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`circuit’s law.”). The first-to-file rule is a principle of federal comity that permits a district court
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`to decline to exercise jurisdiction when a substantially similar complaint is already filed in
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`another district. “This ‘first-to-file’ rule exists to ‘avoid conflicting decisions and promote
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`judicial efficiency.’” Id. (quoting Merial Ltd. v. Cipla Ltd., 681 F.3d 1283, 1299 (Fed. Cir.
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`2012)).
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`The Supreme Court has repeatedly observed that, under the doctrine of comity, when
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`cases involving substantially overlapping issues are pending before two different federal district
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`courts, “[w]ise judicial administration” counsels the avoidance of duplicative litigation. Colo.
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`River Water Conservation Dist. v. United States, 424 U.S. 800, 817 (1976) (alteration in original)
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`(quoting Kerotest Mfg. Co. v. C-O-Two Fire Equip. Co., 342 U.S. 180, 183 (1952)) (emphasizing
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`that, “in situations involving the contemporaneous exercise of concurrent jurisdictions,” courts
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`should “giv[e] regard to conservation of judicial resources and comprehensive disposition of
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`litigation” (citation and internal quotation mark omitted)); Kerotest, 342 U.S. at 183 (noting that
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`1
`Comcast notes that this motion was filed “[s]olely to preserve its statutory rights.” (Dkt.
`No. 62, at 4 n.3.)
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`3
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`Case 1:16-cv-03852-JPO Document 75 Filed 09/16/16 Page 4 of 11
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`“[w]ise judicial administration . . . does not counsel rigid mechanical solution of such problems”
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`and that “[t]he factors relevant to wise administration here are equitable in nature”).
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`The Federal Circuit has announced a general rule to aid in the disposition of cases where
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`a later-filed declaratory judgment action sufficiently overlaps with an earlier-filed patent
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`infringement action: “When two actions that sufficiently overlap are filed in different federal
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`district courts, one for infringement and the other for declaratory relief, the declaratory judgment
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`action, if filed later, generally is to be stayed, dismissed, or transferred to the forum of the
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`infringement action.” Futurewei, 737 F.3d at 708. There are exceptions to the first-to-file rule,
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`but “[t]he general rule favors the forum of the first-filed action, whether or not it is a declaratory
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`action.” Genentech, Inc. v. Eli Lilly & Co., 998 F.2d 931, 937 (Fed. Cir. 1993). Exceptions to
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`this general rule may be based on “the convenience and availability of witnesses, [the] absence
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`of jurisdiction over all necessary or desirable parties, . . . the possibility of consolidation with
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`related litigation, or considerations relating to the real party in interest.” Futurewei, 737 F.3d at
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`708 (alterations in original) (quoting Genentech, 998 F.2d at 938).2
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`B.
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`Preliminary Injunction
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`To be entitled to an injunction, a movant must establish (1) a likelihood of success on the
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`merits of the case; (2) that it will suffer irreparable harm in the absence of injunctive relief; (3)
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`that considering the balance of the hardships between plaintiff and defendant, a remedy at equity
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`is warranted; and (4) that the public interest would not be disserved by a preliminary injunction.
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`2
`See also Adam v. Jacobs, 950 F.2d 89, 92 (2d Cir. 1991) (“‘[W]here there are two
`competing lawsuits, the first suit should have priority, absent the showing of balance of
`convenience . . . or . . . special circumstances . . . giving priority to the second.’ Deference to the
`first filing ‘embodies considerations of judicial administration and conservation of resources.’
`The decision whether or not to stay or dismiss a proceeding rests within a district judge’s
`discretion.” (quoting First City Nat'l Bank and Trust Co. v. Simmons, 878 F.2d 76, 79-80 (2d Cir.
`1989) (alterations in original)).
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`Case 1:16-cv-03852-JPO Document 75 Filed 09/16/16 Page 5 of 11
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`See Winter v. Natural Res. Def. Council, 555 U.S. 7, 20 (2008); see also Tex. Instruments Inc. v.
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`Tessera, Inc., 231 F.3d 1325, 1328 (Fed. Cir. 2000); N.Y. Progress & Prot. PAC v. Walsh, 733
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`F.3d 483, 486 (2d Cir. 2013).
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`III. Discussion
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`A. Motion to Dismiss, Stay, or Transfer
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`The parties agree that the declaratory judgment action filed by Comcast in this Court
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`raises substantially the same issues as the patent infringement action field by Rovi in the EDTX.
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`(See Dkt. No. 50, at 8 (Rovi noting that “the cases substantially overlap”); Dkt. No. 72, at 7:19-
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`21 (Counsel for Comcast noting that “[w]e have got plaintiffs or parties who have run to two
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`different forums and are trying to adjudicate the same issue”).) They disagree, however, as to
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`whether this Court or the EDTX should be the first to interpret the forum selection clause. Rovi
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`contends that Comcast should make its case through motions to transfer in the EDTX, the first-
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`filed forum. (See Dkt. No. 50, at 4–5.) Indeed, Comcast has already filed such motions in the
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`EDTX to transfer the relevant actions from the EDTX to this Court. (See Dkt. No. 62 at 4.)
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`Comcast argues that the first-to-file rule does not apply in this case “because the parties agreed in
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`[two separate licensing agreements] that this dispute would be heard in New York.” (Id. at 7.)
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`In other words, Comcast contends that the forum-selection clauses trump the first-to-file rule.
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`In support of its position, Comcast relies heavily on General Protecht Group, Inc. v.
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`Leviton Manufacturing Co., 651 F.3d 1355 (Fed. Cir. 2011). There, as here, a licensor
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`commenced actions against a licensee outside the forum indicated in the license agreement. Id.
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`at 1358. The licensee in that case commenced a new action “asserting declaratory-judgment
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`claims for breach of contract, [and] non-infringement” in the forum indicated in the license
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`agreement, just as Comcast did in the present action. Id. In General Protecht, the Federal
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`Circuit determined that the district court in the forum indicated in the license agreement did not
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`Case 1:16-cv-03852-JPO Document 75 Filed 09/16/16 Page 6 of 11
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`abuse its discretion in granting a preliminary injunction against the continued litigation of the
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`dispute outside of the indicated forum. Id. at 1366. But General Protecht, at most, permits this
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`Court to enter a preliminary injunction when a forum selection clause likely governs an action
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`brought in other forums. It does not compel that determination.
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`As discussed above, the Federal Circuit has held that, “[w]hen two actions that
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`sufficiently overlap are filed in different federal district courts, one for infringement and the
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`other for declaratory relief, the declaratory judgment action, if filed later, generally is to be
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`stayed, dismissed, or transferred to the forum of the infringement action.” Futurewei Techs., Inc.
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`737 F.3d at 708. In Futurewei, as here, the Federal Circuit adhered to the first-to-file rule
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`notwithstanding the possibility that a forum selection clause in a license agreement might justify
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`transfer, explaining that the first-filed forum could decide issues involving the forum selection
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`clause. Id. at 709. This general rule is expressly intended “to ‘avoid conflicting decisions and
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`promote judicial efficiency.’” Id. at 708 (quoting Merial Ltd., 681 F.3d at 1299).
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`Litigants who believe that a forum selection clause governs an action brought in an
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`alternative forum should first seek to resolve the venue issue in the first-filed forum, absent
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`exceptional circumstances. As the Supreme Court has held, “a forum-selection clause . . . may
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`be enforced through a motion to transfer under § 1404(a).” Atl. Marine Const. Co. v. U.S. Dist.
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`Court for W. Dist. of Texas, 134 S. Ct. 568, 579 (2013). In this case, just such a motion is
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`currently pending before the EDTX court and Comcast fails to demonstrate why the relief
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`requested in that motion would be insufficient.
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` “The courts of this district have adopted a ‘bright-line rule’ that ‘[t]he court before which
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`the first-filed action was brought determines which forum will hear the case.’” Noble v. U.S.
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`Foods, Inc., No. 14-CV-7743-RA, 2014 WL 6603418, at *3 (S.D.N.Y. Nov. 19, 2014)
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`(alteration in original) (quoting MSK Ins., Ltd. v. Emp’rs Reinsurance Corp., 212 F. Supp. 2d
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`Case 1:16-cv-03852-JPO Document 75 Filed 09/16/16 Page 7 of 11
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`266, 267 (S.D.N.Y. 2002)). “Although this bright-line rule is largely identical to and rooted in
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`the first[-]filed rule, it does not provide for any special exceptions. It is a straight-forward rule to
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`be applied in a rote manner.” Pem Am., Inc. v. Lambert, No. 03 Civ. 3706–JFK, 2003 WL
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`22383369, at *2 (S.D.N.Y. Oct. 17, 2003).3
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`These principles apply with equal force to Comcast’s claims that Rovi’s ITC action
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`should be enjoined. The parties do not dispute that the ITC action and one of the EDTX
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`actions—the -322 action—are essentially identical. (See Dkt. No. 50 at 9 (“The earlier-filed ITC
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`action substantially overlaps with the earlier-filed -322 EDTX case, and Comcast’s arguments
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`are substantially the same as to both.”); Dkt. No. 62 at 3 (“[T]he -322 and ITC actions assert
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`infringement of the same seven additional patents.”).) As such, resolution of the effect of the
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`forum selection clauses on the EDTX action would apply equally to the substance of the ITC
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`action.
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`One of the forum selection clauses at issue, however, applies only to suits over which a
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`New York court has subject matter jurisdiction. (See Dkt. No. 28-2 § 7.08 (“[T]his Agreement
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`or the transactions contemplated hereby shall be brought in the United States District Court for
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`Other district courts have likewise concluded that the first-filed forum shall determine the
`applicability of the first-filed rule and whether exceptions to that rule exist. See Cellectis S.A. v.
`Precision Biosciences, Inc., 881 F. Supp. 2d 609, 613 (D. Del. 2012) (concluding that the first-
`filed forum should “determine whether exceptions to the first-filed rule apply”); EMC Corp. v.
`Bright Response, LLC, No. C–12–2841–EMC, 2012 WL 4097707, at *5 (N.D. Cal. Sept. 17,
`2012) (holding that “resolution of whether any exceptions should trump the rule is best
`determined by the [court in which the first action was filed]”); Mycone Dental Supply Co. v.
`Creative Nail Design, Inc., No. 11–4380 (JBS/KMW), 2012 WL 1495496, at *1 (D.N.J. Apr. 26,
`2012) (“The same considerations of comity and efficiency that animate the First-filed Rule also
`dictate that the court in which the matter was first-filed should be the forum to determine which
`court is the more appropriate forum to ultimately adjudicate the merits of this matter.”); Drew
`Techs., Inc. v. Robert Bosch, L.L.C., No. 11–15068, 2012 WL 314049, at *6 (E.D. Mich. Jan. 31,
`2012) (“[T]he determination of the appropriate venue for this dispute should not be made in this
`court. Rather, that decision should be left to the Central District of California as the first-filed
`court.”).
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`New York or any New York State court sitting in New York County, so long as one of such
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`courts shall have subject matter jurisdiction over such suit, action or proceeding.”); Dkt. No. 28-
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`4 § 12.09 (same).) Rovi asserts that even if this forum selection clause governs the substance of
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`the ITC action, this Court would not have subject matter jurisdiction over the ITC action, which
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`is brought under Section 337 of the Tariff Act, such that the forum selection clause would not
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`apply. (Dkt. No. 50 at 10.) It is the EDTX, however, that must first address the threshold issue
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`of whether the infringement action arises from the agreement.
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`Comcast argues that “it would itself breach the CLA and LDA if it sought to enforce
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`those agreements and enjoin the ITC action in Texas rather than in New York.” (Dkt. No. 62 at
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`13.) It asks this Court to find that the ITC action is covered by both forum selection clauses and
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`to enjoin Rovi from pursuing the action. Comcast puts the cart before the horse. If the EDTX,
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`as the first-filed forum, finds that the forum selection clauses do not apply to the current
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`actions—allowing the actions to remain in the EDTX—then this Court would not need to answer
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`the secondary question as to whether this Court has subject matter jurisdiction over the ITC
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`proceedings. If, on the other hand, the EDTX interprets the forum selection clauses to require
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`that the actions be brought in this Court, it will then become necessary to resolve whether this
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`Court has subject matter jurisdiction over the ITC action sufficient to justify enjoining that action
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`under the forum selection clauses. Premature resolution of the application of the forum selection
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`clauses to the ITC action would thwart the principles of comity and efficiency underlying the
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`first-to-file rule. Comcast fails, moreover, to argue persuasively for any of the exceptions to the
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`generally applicable first-to-file rule. See Futurewei, 737 F.3d at 708 (recognizing that
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`justifications for an exception include “the convenience and availability of witnesses, [the]
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`absence of jurisdiction over all necessary or desirable parties, . . . the possibility of consolidation
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`Case 1:16-cv-03852-JPO Document 75 Filed 09/16/16 Page 9 of 11
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`with related litigation, or considerations relating to the real party in interest” (alterations in
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`original) (quoting Genentech, 998 F.2d at 938)).
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`Because the first-filed forum, the EDTX, is no less capable than this Court of determining
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`the appropriate forum, and in the interest of “[w]ise judicial administration”—in light of the
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`“ample degree of discretion” that this Court exercises in such matters—this Court grants Rovi’s
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`motion to stay the case pending resolution of the earlier-filed motions to transfer in the EDTX.
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`Kerotest Mfg. Co., 342 U.S. at 183–84.
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`B.
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`Preliminary Injunction
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`Having granted Rovi’s motion to stay the case, the Court concludes that it would be
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`inappropriate to rule on the likelihood of Comcast’s success on the merits for the same reasons
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`that animate the first-to-file rule. See Futurewei, 737 F.3d at 708. The determination of
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`Comcast’s likelihood of success on the merits of its breach of contract claims hinges on a
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`determination of the scope and effect of the forum selection clauses. In the interests of comity
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`among the federal courts, and to avoid conflicting decisions and promote judicial efficiency, this
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`determination should be made by the first-filed forum, the EDTX, by way of the currently
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`pending motions to transfer.
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`In any event, Comcast’s request for a preliminary injunction in this case would be denied
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`due to Comcast’s failure to demonstrate irreparable harm. Comcast argues that being “deprived
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`of its bargained-for forum” is alone sufficient to demonstrate irreparable harm, and that in the
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`absence of an injunction “Comcast will be forced to engage in burdensome, duplicative, and fast-
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`paced litigation on multiple fronts.” (Dkt. No. 27, at 21.) The Court finds that Comcast’s
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`contentions concerning irreparable harm carry little weight in the face of the ability of the EDTX
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`to first evaluate the merits of its claim and, if appropriate, transfer the case to the allegedly
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`Case 1:16-cv-03852-JPO Document 75 Filed 09/16/16 Page 10 of 11
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`bargained-for forum. To the extent that Comcast is concerned about the burden of litigating on
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`multiple fronts, this Court’s stay will serve to alleviate that burden.
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`These are precisely the concerns that the first-to-file rule is intended to address. “The
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`‘first-to-file’ rule . . . generally favors pursuing only the first-filed action when multiple lawsuits
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`involving the same claims are filed in different jurisdictions. Merial Ltd., 681 F.3d at 1299
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`(emphasis added). In this case, that means that the EDTX court is the proper court to determine
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`whether it is the appropriate forum for the pending claims. See EMC Corp. v. Parallel Iron,
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`LLC, 914 F. Supp. 2d 125, 129 (D. Mass. 2012) (“The first-to-file rule has generally been
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`interpreted to dictate not only which forum is appropriate, but also which forum should decide
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`which forum is appropriate.”); Adam, 950 F.2d at 92 (“We consider the propriety of the forum a
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`threshold issue that must be considered before addressing the merits.”).
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`Given the utmost confidence this court has in its sister court, and as that court has yet to
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`decide the pending motions to transfer, Comcast has not demonstrated at this early stage that it
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`has been deprived of its bargained-for forum. Accordingly, Comcast’s motion for a preliminary
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`injunction is denied.
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`IV. Conclusion
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`For the foregoing reasons, and based on all arguments at the preliminary injunction
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`hearing, the Court concludes that the first-filed rule applies in this case, and that the EDTX is
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`best positioned, in the first instance, to decide whether any exceptions should trump that rule.
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`Because the EDTX has yet to rule on the pending motions, however, the Court determines that it
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`would inappropriate to dismiss or transfer this action at this time.
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`Accordingly, Defendant Rovi’s motion to dismiss, or alternatively, stay or transfer is
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`GRANTED in part and DENIED in part. The request for a stay is granted and this matter is
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`Case 1:16-cv-03852-JPO Document 75 Filed 09/16/16 Page 11 of 11
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`hereby STAYED pending a ruling by the Eastern District of Texas on the pending motions to
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`transfer. In other respects the motion is denied without prejudice.
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`Comcast’s motion for a preliminary injunction is DENIED without prejudice, and
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`Comcast’s motion for a stay pursuant to 28 U.S.C. § 1659(a) is DENIED as moot.
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`The parties are directed to update the Court as to the status of the EDTX action within
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`sixty days of the date of this Order, and every sixty days thereafter, until that action is resolved.
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`Should the EDTX court render a final judgment, the parties are directed to notify the Court
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`within thirty days.
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`The Clerk of Court is directed to close the motions at Docket Numbers 25, 49 and 57.
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`SO ORDERED.
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`Dated: September 16, 2016
`New York, New York
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`____________________________________
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` J. PAUL OETKEN
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` United States District Judge
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`11