In Credit Card Fraud Control Corp. v. Maxmind, Inc., a defendant moved a Northern District of Texas court to stay litigation under AIA § 18(b)(2) based on a petition for CBM review that had not yet been instituted by the PTAB. No. 3:14-cv-3262, 2015 U.S. Dist. LEXIS 53775 (N.D. Tex. Apr. 24, 2015). Similar to the trend in the Eastern District of Texas and elsewhere, about which we have previously written, the motion to stay was denied without prejudice. To reach this conclusion, the court applied the four factors set out in AIA § 18(b)(1). The court’s analysis offers noteworthy lessons about moving to stay litigation before the Board has acted on the petition for CBM review of the patent-in-suit.
(1) Simplifying the issues: The court viewed the prospect of simplification as speculative or hypothetical. Further, the court did not give weight to generic contentions about the advantages of a stay (e.g., encouraging settlement and reducing costs and burden for the court), which could potentially be applicable in every case.
(2) Stage of litigation: According to the court, the proper time to measure the stage of litigation is the date of the filing of the motion to stay. Further, the fact that a case is seemingly in its infancy might “only tell part of the story.” In this case, the court found it significant that the defendant: (a) waited to file its motion to stay until the due date for the joint report setting forth proposed deadlines, and (b) requested and received two extensions of time to answer the original complaint.
(3) Undue prejudice: Here, again, delay (requesting and receiving extensions of time to answer and waiting until the joint report was due to file its motion to stay) worked to the defendant’s disadvantage. The court indicated, however, a willingness to reconsider its finding in the event the Board institutes the CBM review.
(4) Reducing the burden of litigation: As with the first factor, the court viewed the prospect of reduced burden as speculative because the defendant’s arguments largely depended on an “optimistic view” of the merits of a petition for CBM review not yet instituted.
As mentioned above, the court denied the defendant’s motion to stay. Further, based on a recent Federal Circuit decision (discussed in this post), the defendant must live with the court’s order at least until the CBM review is instituted, if at all.