To Stay or Not to Stay During Inter Partes Review?

Recent data relating to the recently instituted inters partes review proceedings demonstrates that more than 70% of requests for stay of co-pending litigations have been granted. But what factors are courts looking at to determine when a stay is appropriate?

In deciding whether or not to grant a stay pending inter partes review, courts have looked at three significant factors, as outlined in Universal Elecs., Inc. v. Universal Remote Control, Inc. (Order Denying Defendant’s Motion to Stay Pending Inter Partes Review at 4, No. SACV 12-00329 AG (C.D. Cal. May 2, 2013) ECF No. 78):

1. whether discovery is complete and whether a trial date has been set;
2. whether a stay will simplify the issues in question and trial of the case; and
3. whether a stay would unduly prejudice or present a clear tactical disadvantage to the nonmoving party.

As to the first factor, a number of courts have denied requests for stay when fact discovery was well advanced or complete and Markman orders were issued or imminent. This was the case in Universal Elecs.; Nat’l Oilwell Varco, L.P. v. Omron Oilfield & Marine, Inc. (No. 1:12-cv-00773-SS (W.D. Tex June 10, 2013), ECF No. 42; Order Denying Motions to Stay at 3); and Ariosa Diagnostics, Inc. v. Sequenom, Inc. (No. 3:11-cv-06391-SI (N.D. Cal June 11, 2013), ECF No. 198).

And as to the second factor, courts appear inclined to find that a stay will not likely simplify the issues on a timely basis when the PTAB has yet to grant a request for inter partes review, as demonstrated in Ariosa.

In addition, the district court’s opinion in Ariosa further suggests that the third factor played a role in the decision to deny stay. Specifically, the court found persuasive the non-moving party’s argument that it would be severely prejudiced by the stay when there was no guarantee that the IPR, if granted, would narrow the issues in the case.

Of course, these three factors are not controlling. Courts have noted that, as in requests for stay in other circumstances, there are a variety of factors that must be considered to determine whether or not to grant a stay, including, as noted in Universal Elecs, the courts’ ability to control their dockets “to secure the just, speedy, and inexpensive determination of every action.” As such, in assessing an overall litigation strategy, it is wise to consider not only the factors identified above, but the particular court’s tendencies, if discernible, in deciding such matters.