• Did You Know . . . Respondents Can Stay Parallel District Court Actions under 28 U.S.C. § 1659?
  • March 9, 2010 | Author: Eric W. Schweibenz
  • Law Firm: Oblon, Spivak, McClelland, Maier & Neustadt, L.L.P. - Alexandria Office
  • Under 28 U.S.C. § 1659(a), upon timely request of a Section 337 Respondent, who is also a party in a civil action, a “district court shall stay, until the determination of the Commission becomes final, proceedings in the civil action with respect to any claim that involves the same issues involved in the proceeding before the Commission.”  A Respondent’s request for a stay is deemed timely only if made within (1) 30 days after being named as a respondent in the ITC proceeding, or (2) 30 days after the district court action is filed, whichever is later.

    In addition to making a timely request, a Respondent also must show that the claims in the district court action involve the same issues before the ITC.  This similarity of issues requirement has been interpreted by some district courts to require that the patents asserted in both forums be identical.  By way of example, in Saxon Innovations, LLC v. Palm, Inc., 2009 U.S. Dist. LEXIS 105928 (E.D. Tx. Nov. 4, 2009), the plaintiff Saxon accused Palm of infringing its ‘873 patent.  Saxon had also asserted its ‘873 patent in a parallel ITC investigation.  Although Palm was a respondent in that parallel ITC investigation, Saxon did not assert its ‘873 patent against Palm in that forum.  The district court denied Palm’s request to stay the district court action against it finding that “[t]he claims against Palm in this case and the claims against Palm in the ITC investigation are not ‘identical parallel claims.’”  In explaining its ruling, the court noted the fact that the ITC will not consider Palm’s alleged infringement of the ‘873 patent nor will it consider Palm’s invalidity theories of the ‘873 patent, if any.  Similarly, in Micron Tech., Inc. v. Mosel Vitelic Corp., 1999 U.S. Dist. LEXIS 4792 (D. Id. Mar. 31, 1999), the district court denied the defendants’ request to stay under § 1659(a) a consolidated action in its entirety where only four of eleven patent infringement claims were asserted in the ITC.  The district court rejected the defendants’ assertions that the seven patent infringement claims not before the ITC were so related to the four patent infringement claims before the ITC that they implicated substantially similar legal and factual issues, including the fact that the plaintiff alleged the same products infringed all eleven patents.  Although the district court refused to stay the action with respect to the seven patent infringement claims not before the ITC, the court granted the defendants’ motion to stay the remaining four patent infringement claims until such time as the resolution of the ITC action became final.

    Other district courts have determined that although § 1659 may not be applicable, it can use its discretionary authority to stay any non-identical patent infringement claims.  For example, in SanDisk Corp. v. Phison Elec. Corp., 538 F.Supp.2d 1060 (W.D. Wis. 2008), the district court stayed, under its inherent power, a separate action involving non-identical patent infringement claims filed by the plaintiff against the same defendants/respondents.  In staying the separate action, the court noted that the patents shared the same prosecution history and specification of one of the patents asserted in the plaintiff’s other district court action that was stayed under § 1659.  Similarly, in Formfactor, Inc. v. Micronics Japan Co., Ltd., 2008 U.S. Dist. LEXIS 131114 (N.D. Cal. Feb. 11, 2008), in addition to staying two patent infringement claims under § 1659, the district court stayed, under its inherent power, two non-identical patent infringement claims.  The court noted that the four asserted patents shared at least two common inventors.  In staying the entire action, the district court cited the potential duplication of discovery that would occur if the two remaining claims were not stayed and stated that “the similarity of the patents in subject matter [was] sufficient to warrant staying the matter... in order to gain the additional knowledge of the ITC proceedings and  ...to benefit from litigating the four patents in this action together.”

    In the event that a district court ultimately determines to stay a civil action under 28 U.S.C. § 1659(a), the civil action is stayed “until the determination of the Commission becomes final.”  This statutory language has been interpreted by the Federal Circuit to mean that “§ 1659 requires that the stay of district court proceedings continue until the Commission proceedings are no longer subject to judicial review.”  In re Princo Corp., 478 F.3d 1345, 1355 (Fed. Cir. 2007).