Case 2:16-cv-00741-RWS Document 289 Filed 01/11/18 Page 1 of 6 PageID #: 5550
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`MARSHALL DIVISION
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`UNILOC USA, INC., et al.,
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`Plaintiffs,
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`v.
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`ADP, LLC,
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`Defendant.
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`EMERGENCY OPPOSED RULE 62.1 MOTION FOR AN INDICATIVE RULING ON A
`MOTION FOR RELIEF THAT IS BARRED BY A PENDING APPEAL
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`Uniloc moves under Federal Rule of Civil Procedure 62.1 for an indicative ruling stating
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`§ Case No. 2:16-cv-00741-RWS
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`LEAD CASE
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`that the Court would grant a motion to vacate the judgment in this action, as to ADP, LLC
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`(“ADP”) (but not as to its co-defendant, Big Fish Games, Inc. (“Big Fish”)) if the United States
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`Court of Appeals for the Federal Circuit remands for that purpose, as laid out in the attached
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`Proposed Order.
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`Uniloc files this as an Emergency Motion, because a speedy ruling would assist the
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`Federal Circuit to rule on a motion to dismiss the appeal ADP filed in that court on January 5,
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`2018.
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`Previous Motions
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`This motion is somewhat similar to earlier joint motions the Court denied, Dkt. 281, but,
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`because of developments in the Federal Circuit appeal, the situation has changed markedly.
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`To review, on September 28, 2017, this Court issued a Memorandum Opinion and Order
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`(the “September 28 Order”) dismissing this action against ADP and a related action against Big
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`Fish, Dkt. 267, and entered final judgment in both actions on October 20. Dkt. 269. On October
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`31, Uniloc and ADP jointly submitted, and then resubmitted, a Stipulation and Joint Motion to
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`Vacate the Judgment, in the ADP action only. Dkts. 273, 278. The Court denied the joint
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`Case 2:16-cv-00741-RWS Document 289 Filed 01/11/18 Page 2 of 6 PageID #: 5551
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`request, Dkt. 281, forcing Uniloc to file a notice of appeal of the September 28 Order in the ADP
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`action. Dkt. 280.
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`Jurisdiction
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`Filing of that notice caused the transfer of jurisdiction of the ADP action from this Court
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`to the Federal Circuit. Because that transfer deprives this Court of the authority to grant the
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`relief this motion requests, Uniloc now asks for an indicative ruling stating that the Court would
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`dismiss the action, if the Court of Appeals remits for that purpose.
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`Basis for the Motion
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`This action accused ADP of infringing four patents (the “Cox patents”), which had issued
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`to International Business Machines (IBM). Uniloc purchased the rights to those patents from
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`IBM in February 2016 (Etchegoyen Decl., ¶2). Uniloc filed suit against ADP in October 2016,
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`alleging Uniloc had all rights to sue on those patents (id., ¶3).
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`The September 27 Agreement
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`In early September 2017, IBM notified Uniloc that it was discussing with ADP a
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`potential agreement, one aspect of which would obligate IBM to obtain from Uniloc a dismissal
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`with prejudice of this action (id., ¶4). After further discussion, IBM and Uniloc tentatively
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`agreed that, in return for consideration running from IBM to Uniloc, Uniloc would file a
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`stipulation dismissing the ADP action with prejudice (id., ¶5).
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`On September 21, an attorney for Uniloc sent to attorneys for ADP a draft Stipulation of
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`Dismissal with Prejudice, asking for ADP’s revisions (id., ¶6 & Ex. A). The ADP attorneys
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`responded they had not received instructions from their client (Etchegoyen Decl., ¶6).
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`On September 26-27, Uniloc and IBM executed an agreement (“the September 27
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`Agreement”) (id., ¶7 & Ex. B), which was intended to end this action, against ADP.
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`The signatories mistakenly believed the stipulation of discontinuance had already been
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`filed with the Court (Etchegoyen Decl., ¶7). Thus, the agreement read:
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`Uniloc and ADP, LLC are parties to the following action: Uniloc USA, Inc. and
`Uniloc Luxembourg, S. A. v. ADP, LLC, No. 2:2016-cv-00741 (EDTX)(the
`“Action”)
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`Uniloc has provided evidence that, counsel for Uniloc has executed and filed with
`the Court a Stipulation of Dismissal with Prejudice of all claims in the action
`against ADP.
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`Ex. B. However, the Stipulation of Dismissal with Prejudice had not yet been filed. Thus, when
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`the Court issued its September 28 Order dismissing the action on the merits, the Court would
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`have been unaware of the September 27 Agreement, between IBM and Uniloc.
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`The purpose of the September 27 IBM-Uniloc Agreement had been to get ADP out of the
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`case, permanently. Had the Stipulation of Dismissal with Prejudice been filed before the Court’s
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`September 28 Order, ADP would have been out of the case before the Court’s Order. But
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`because the Court issued the September 28 Order only a day after the September 27 Agreement,
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`and the timing of the Order was unexpected, the parties did not have sufficient time or warning
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`to file a Stipulation of Dismissal with Prejudice before the September 28 Order issued.
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`Next Steps
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`At that point, Uniloc and ADP were in a quandary, as to how to proceed. The entry of
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`the September 28 Order in this ADP action ruled out filing a simple Stipulation of Dismissal with
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`Prejudice as to ADP because the ADP September 28 Order, if left standing and unappealed,
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`could create issue preclusion as to the Cox patents.
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`So Uniloc and ADP instead filed a Stipulation and Joint Motion requesting the Court to
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`vacate the judgment, as to ADP only, and advised the Court that they had settled, but conditioned
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`on vacatur, to avoid creating issue estoppel. Dkt. 273. After the Court twice denied that request,
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`Uniloc filed a notice of appeal of the September 28 Order, but this time as to ADP, on November
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`20. Dkt. 280.1 (Uniloc had previously filed a notice of appeal as to Big Fish, on October 27. Dkt.
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`271).
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`Subsequent Developments
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`The situation, as to ADP, has since become more complicated. On January 5, 2018, ADP
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`filed a motion in the Federal Circuit asking for dismissal of the appeal, arguing there is no longer
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`any case or controversy, because IBM had given it a license and a release on October 27,
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`ostensibly under the September 27 Agreement. (Gannon Decl., Ex. 1).
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`If ADP is correct that the appeal should be dismissed as a result of the September 27
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`Agreement giving IBM the right to license ADP and grant a release, then Uniloc would have lost
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`its standing to continue the action against ADP when the September 27 Agreement was
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`executed, before the Court issued the September 28 Order.
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`What to Do Now
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`Uniloc will respond to ADP’s motion in the Federal Circuit, and, in that response, will
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`ask that court to sort out what should happen next. Uniloc believes the September 28 Order in
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`ADP should not create issue preclusion if Uniloc, through no fault of its own, cannot pursue an
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`appeal. For that reason, the Federal Circuit may deny the motion, finding there is a case or
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`controversy sufficient to keep ADP in the appeal. But it is equally, or perhaps more, likely, that
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`the Federal Circuit will rule that the issue of what effect should be given to the September 27
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`Agreement is an issue that should be decided, in the first instance, at the District Court.
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`1 On December 20, Uniloc also filed a Notice of Appeal of that denial. Dkt. 286.
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`To facilitate review of the entire controversy in the Federal Circuit, Uniloc is filing this
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`motion to give this Court the opportunity to either vacate the judgment, and end the preclusion
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`controversy, or provide its views to that court as to why it refuses to do so.
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`Importantly, Uniloc is only asking the Court to vacate the judgment as to ADP, and not as
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`to Big Fish, the other defendant that received the identical judgment. See Dkts. 267 and 269.
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`The Big Fish judgment will remain in effect. Uniloc has appealed the Big Fish judgment, and
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`thus the Federal Circuit will fully review that judgment. Therefore, the only practical effect of
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`vacating the ADP judgment will be to relieve the Federal Circuit of the burden of sorting out the
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`preclusion issue.
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`Before the September 28 Order, Uniloc and IBM had agreed to dismiss ADP with
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`prejudice, and to fulfill that agreement, would now like to dismiss ADP from the appeal.
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`However, if the appeal as to ADP were voluntarily withdrawn without the Court’s Order and
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`Final Judgment being vacated as to ADP, then the Order and Judgment could have preclusive
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`effect as to the rest of the world, including even as to Big Fish and all other defendants accused
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`of infringing the Cox patents. This would vitiate Uniloc’s Big Fish appeal and bar any further
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`enforcement of the Cox patents-in-suit. On the other hand, if the Order and Judgment are
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`vacated as to ADP, those rulings would remain in effect as to the rest of the world (because of
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`the Big Fish judgment) and the appeal as to Big Fish would continue.
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`Conclusion
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`For the above reasons, Uniloc respectfully requests the Court to indicate that, if the
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`Federal Circuit remands for that purpose, this Court will vacate its Judgment, entered October
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`20, 2017 (Docket No. 269), and Order, dated September 28, 2017 (Docket No. 267), as to ADP
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`only, but not as to any other defendant.
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`Case 2:16-cv-00741-RWS Document 289 Filed 01/11/18 Page 6 of 6 PageID #: 5555
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`Date: January 11, 2018
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`Respectfully submitted,
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`/s/ James J. Foster
`Paul J. Hayes
`James J. Foster
`Kevin Gannon
`Prince Lobel Tye LLP
`One International Place - Suite 3700
`Boston, MA 02110
`Tel: 617-456-8000
`Email: phayes@princelobel.com
`Email: jfoster@princelobel.com
`Email: kgannon@princelobel.com
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`Edward R. Nelson III
`ed@nelbum.com
`Texas State Bar No. 00797142
`Anthony M. Vecchione
`anthony@nelbum.com
`Texas State Bar No. 24061270
`NELSON BUMGARDNER PC
`3131 West 7th Street, Suite 300
`Fort Worth, Texas 76107
`Phone: (817) 377-9111
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`ATTORNEYS FOR THE PLAINTIFFS
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`CERTIFICATE OF CONFERENCE
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`Pursuant to Local Rules CV-7(h) and (i), I hereby certify that on January 10, 2018, I
`conferred with counsel of record for ADP regarding the subject matter of this Motion. ADP is
`opposed to the above motion.
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`/s/ James J. Foster
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`CERTIFICATE OF SERVICE
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`I hereby certify that all counsel of record who have consented to electronic service are
`being served with a copy of this document via the Court’s CM/ECF system per Local Rule CV-
`5(a)(3) on January 11, 2018.
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`/s/ James J. Foster
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