1 2 3 4 5 6 7 10 11 FATE THERAPEUTICS, INC.; and Case No.: 22-cv-00676-H-MSB WHITEHEAD INSTITUTE FOR 12 BIOMEDICAL RESEARCH, ORDER GRANTING PLAINTIFFS’ 13 MOTION FOR APPROVAL OF Plaintiffs, SUPERSEDEAS BOND AND TO 14 v. STAY THE EXECUTION AND 15 ENFORCEMENT OF COSTS SHORELINE BIOSCIENCES, INC., AWARD 16 Defendant. 17 [Doc. No. 439.]
18 On November 17, 2023, Plaintiffs Fate Therapeutics, Inc. (“Fate”) and Whitehead 19 Institute for Biomedical Research (“Whitehead”) filed a motion for approval of a 20 supersedeas bond and to stay the execution and enforcement of the Court’s costs award. 21 (Doc. No. 439.) On November 20, 2023, the Court took Plaintiffs’ motion under 22 submission. (Doc. No. 441.) On December 1, 2023, Defendant Shoreline Biosciences, 23 Inc. (“Shoreline”) filed a non-opposition to Plaintiffs’ motion. (Doc. No. 443.) For the 24 reasons below, the Court grants Plaintiffs’ motion for approval of a supersedeas bond and 25 to stay the execution and enforcement of the Court’s costs award. 26 / / / 27 / / / 28 1 Background 2 In this action, Plaintiffs asserted claims for patent infringement under 35 U.S.C. §§ 3 271(a), (b), and (g) against Defendant Shoreline, alleging claims for infringement of U.S. 4 Patent Nos. 8,071,369 (“the ’369 Patent”), 8,932,856 (“the ’856 Patent”), 8,951,797 (“the 5 ’797 Patent”), 8,940,536 (“the ’536 Patent”), 9,169,490 (“the ’490 Patent”), 10,457,917 6 (“the ’917 Patent”), and 10,017,744 (“the ’744 Patent”) (collectively, “the asserted 7 patents”). (Doc. No. 162, Supp. FAC ¶¶ 157-414.) Specifically, Plaintiffs alleged that 8 Shoreline makes, uses, sells, offers for sale, and/or imports induced pluripotent stem cells 9 (“iPSCs”) that infringe one or more claims of the asserted patents.1 (Id. ¶ 140; see, e.g., 10 id. ¶¶ 162 (“Defendants’ use of their ‘iPSC-derived cell therapy manufacturing platform’ 11 infringed at least claim 1 of the ’369 Patent.”), 212 (“iPSCs used by Defendants to make 12 at least the iPSC-derived natural kill (NK) cell platforms are made by a process that 13 comprises at least each step of claim 1 of the ’856 Patent.”).) 14 On May 13, 2022, Plaintiffs filed a complaint against Defendants Shoreline and Dan 15 S. Kaufman, alleging claims for infringement of the ’369 Patent, the ’856 Patent, the ’797 16 Patent, the ’536 Patent, the ’490 Patent, and the ’917 Patent. (Doc. No. 1, Compl. ¶¶ 66- 17 236.) On August 12, 2022, the Court issued a scheduling order. (Doc. No. 51.) On January 18 3, 2023, Plaintiffs filed a first amended complaint against Defendants, adding a claim for 19 infringement of the ’744 Patent. (Doc. No. 112, FAC ¶¶ 375-414.) On January 10, 2023, 20 the Court issued an amended scheduling order. (Doc. No. 115.) 21 22 1 Induced pluripotent stem cells (“iPSCs”) “are pluripotent stem cells generated from somatic cells by reprogramming.” (Doc. 162, Supp. FAC ¶ 31; see Doc. No. 184, Answer 23 to Supp. FAC ¶ 31; see also Doc. No. 151-14, Plath Decl. ¶ 59; Doc. No. 152, Snyder Decl. 24 ¶ 43.) “Four specific genes—cMYC, OCT3/4, SOX2 and KLF4—encoding transcription factors play a role in converting or reprogramming somatic cells into pluripotent stem 25 cells.” (Doc. 162, Supp. FAC ¶ 32; see Doc. No. 184, Answer to Supp. FAC ¶ 32; Doc. 26 No. 199, Answer to Supp. FAC ¶ 32; see also Doc. No. 184, Counterclaims ¶ 43 (“iPSCs are generated in culture from somatic cells through the introduction of reprogramming 27 factors that transform a somatic cell into a pluripotent state.”); Doc. No. 152, Snyder Decl. 28 ¶¶ 41, 43.) 1 On February 14, 2023, Plaintiffs filed a supplemental first amended complaint – the 2 operative complaint. (Doc. No. 162, Supp. FAC.) On February 17 and 23, 2023, 3 Defendants filed answers and counterclaims to Plaintiffs’ supplemental first amended 4 complaint. (Doc. Nos. 184, 199.) 5 On February 28, 2023, the Court issued a claim construction order construing agreed 6 upon and disputed claim terms from the asserted patents.2 (Doc. No. 208.) On March 27, 7 2023, the Court denied Shoreline’s motion for partial summary judgment. (Doc. No. 226.) 8 On March 30, 2023, the Court denied Defendants’ partial motion to dismiss Plaintiffs’ 9 supplemental first amended complaint. (Doc. No. 234.) 10 On June 9, 2023, the Court dismissed Defendant Kaufman from the action with 11 prejudice pursuant to Plaintiffs’ motion. (Doc. No. 273.) On August 30, 2023, the Court 12 granted Defendant Shoreline’s motion for summary judgment of non-infringement. (Doc. 13 No. 390.) On August 31, 2023, the Court entered a judgment in favor of Defendant 14 Shoreline and against Plaintiffs Whitehead and Fate. (Doc. No. 391.) On October 16, 15 2023, the Court denied Shoreline’s motion for attorney’s fees pursuant to 35 U.S.C. § 285. 16 (Doc. No. 434.) 17 On October 26, 2023, the Clerk of Court taxed costs in the amount of $36,848.50 18 against Plaintiffs. (Doc. No. 438.) By the present motion, Plaintiffs request that the Court 19 approve Plaintiffs’ proffered supersedeas bond in the amount of $46,060.63 (1.25 times the 20 Court’s Order Taxing Costs) and that the Court stay the execution and enforcement of the 21 Court’s Order Taxing Costs until all appeals in this action are exhausted. (Doc. No. 439-1 22 at 1, 2-3.) 23 / / / 24 / / / 25 / / / 26
27 2 On April 19, 2023, the Court denied Plaintiffs’ motion for reconsideration of the 28 1 Discussion 2 “An appellant may stay execution of a judgment by posting a supersedeas bond.” 3 Clark v. Hidden Valley Lake Ass’n, No. 16-CV-02009-SI, 2018 WL 2412136, at *1 (N.D. 4 Cal. May 29, 2018) (citing Cotton ex rel. McClure v. City of Eureka, Cal., 860 F. Supp. 2d 5 999, 1025 (N.D. Cal. 2012)). Federal Rule of Civil Procedure 62(b) provides: 6 Stay by Bond or Other Security. At any time after judgment is entered, a party may obtain a stay by providing a bond or other security. The stay takes 7 effect when the court approves the bond or other security and remains in effect 8 for the time specified in the bond or other security. 9 Fed. R. Civ. P. 62(b). “‘Where a party has posted a bond acceptable to the court, the party 10 is entitled to a stay ‘as a matter of right’ under Rule 62.’” AGK Sierra de Montserrat, L.P. 11 v. Comerica Bank, No. 2:15-CV-01280-DAD-DB, 2023 WL 3582350, at *1 (E.D. Cal. 12 May 22, 2023) (quoting Jordan v. Wonderful Citrus Packing LLC, No. 13 118CV00401AWISAB, 2020 WL 7360585, at *1 (E.D. Cal. Dec. 15, 2020)); see Am. 14 Mfrs. Mut. Ins. Co. v. Am. Broad.-Paramount Theatres, Inc., 87 S. Ct. 1, 3 (1966). Rule 15 62(b)’s bond requirement “protects the prevailing [party] from the risk of a later 16 uncollectible judgment and compensates him for delay in the entry of the final judgment.” 17 N.L.R.B. v. Westphal, 859 F.2d 818, 819 (9th Cir. 1988); see also Rachel v. Banana 18 Republic, Inc., 831 F.2d 1503, 1505 n.1 (9th Cir. 1987) (“The purpose of a supersedeas 19 bond is to secure the appellees from a loss resulting from the stay of execution . . . .”). 20 “District courts have inherent discretionary authority in setting supersedeas bonds.” 21 Rachel, 831 F.2d at 1505 n.1. “Generally, ‘the amount of the bond should be sufficient to 22 pay the judgment plus interest, costs and any other relief (e.g. attorney fees) the appellate 23 court may award.’” Cotton, 860 F. Supp.
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1 2 3 4 5 6 7 10 11 FATE THERAPEUTICS, INC.; and Case No.: 22-cv-00676-H-MSB WHITEHEAD INSTITUTE FOR 12 BIOMEDICAL RESEARCH, ORDER GRANTING PLAINTIFFS’ 13 MOTION FOR APPROVAL OF Plaintiffs, SUPERSEDEAS BOND AND TO 14 v. STAY THE EXECUTION AND 15 ENFORCEMENT OF COSTS SHORELINE BIOSCIENCES, INC., AWARD 16 Defendant. 17 [Doc. No. 439.]
18 On November 17, 2023, Plaintiffs Fate Therapeutics, Inc. (“Fate”) and Whitehead 19 Institute for Biomedical Research (“Whitehead”) filed a motion for approval of a 20 supersedeas bond and to stay the execution and enforcement of the Court’s costs award. 21 (Doc. No. 439.) On November 20, 2023, the Court took Plaintiffs’ motion under 22 submission. (Doc. No. 441.) On December 1, 2023, Defendant Shoreline Biosciences, 23 Inc. (“Shoreline”) filed a non-opposition to Plaintiffs’ motion. (Doc. No. 443.) For the 24 reasons below, the Court grants Plaintiffs’ motion for approval of a supersedeas bond and 25 to stay the execution and enforcement of the Court’s costs award. 26 / / / 27 / / / 28 1 Background 2 In this action, Plaintiffs asserted claims for patent infringement under 35 U.S.C. §§ 3 271(a), (b), and (g) against Defendant Shoreline, alleging claims for infringement of U.S. 4 Patent Nos. 8,071,369 (“the ’369 Patent”), 8,932,856 (“the ’856 Patent”), 8,951,797 (“the 5 ’797 Patent”), 8,940,536 (“the ’536 Patent”), 9,169,490 (“the ’490 Patent”), 10,457,917 6 (“the ’917 Patent”), and 10,017,744 (“the ’744 Patent”) (collectively, “the asserted 7 patents”). (Doc. No. 162, Supp. FAC ¶¶ 157-414.) Specifically, Plaintiffs alleged that 8 Shoreline makes, uses, sells, offers for sale, and/or imports induced pluripotent stem cells 9 (“iPSCs”) that infringe one or more claims of the asserted patents.1 (Id. ¶ 140; see, e.g., 10 id. ¶¶ 162 (“Defendants’ use of their ‘iPSC-derived cell therapy manufacturing platform’ 11 infringed at least claim 1 of the ’369 Patent.”), 212 (“iPSCs used by Defendants to make 12 at least the iPSC-derived natural kill (NK) cell platforms are made by a process that 13 comprises at least each step of claim 1 of the ’856 Patent.”).) 14 On May 13, 2022, Plaintiffs filed a complaint against Defendants Shoreline and Dan 15 S. Kaufman, alleging claims for infringement of the ’369 Patent, the ’856 Patent, the ’797 16 Patent, the ’536 Patent, the ’490 Patent, and the ’917 Patent. (Doc. No. 1, Compl. ¶¶ 66- 17 236.) On August 12, 2022, the Court issued a scheduling order. (Doc. No. 51.) On January 18 3, 2023, Plaintiffs filed a first amended complaint against Defendants, adding a claim for 19 infringement of the ’744 Patent. (Doc. No. 112, FAC ¶¶ 375-414.) On January 10, 2023, 20 the Court issued an amended scheduling order. (Doc. No. 115.) 21 22 1 Induced pluripotent stem cells (“iPSCs”) “are pluripotent stem cells generated from somatic cells by reprogramming.” (Doc. 162, Supp. FAC ¶ 31; see Doc. No. 184, Answer 23 to Supp. FAC ¶ 31; see also Doc. No. 151-14, Plath Decl. ¶ 59; Doc. No. 152, Snyder Decl. 24 ¶ 43.) “Four specific genes—cMYC, OCT3/4, SOX2 and KLF4—encoding transcription factors play a role in converting or reprogramming somatic cells into pluripotent stem 25 cells.” (Doc. 162, Supp. FAC ¶ 32; see Doc. No. 184, Answer to Supp. FAC ¶ 32; Doc. 26 No. 199, Answer to Supp. FAC ¶ 32; see also Doc. No. 184, Counterclaims ¶ 43 (“iPSCs are generated in culture from somatic cells through the introduction of reprogramming 27 factors that transform a somatic cell into a pluripotent state.”); Doc. No. 152, Snyder Decl. 28 ¶¶ 41, 43.) 1 On February 14, 2023, Plaintiffs filed a supplemental first amended complaint – the 2 operative complaint. (Doc. No. 162, Supp. FAC.) On February 17 and 23, 2023, 3 Defendants filed answers and counterclaims to Plaintiffs’ supplemental first amended 4 complaint. (Doc. Nos. 184, 199.) 5 On February 28, 2023, the Court issued a claim construction order construing agreed 6 upon and disputed claim terms from the asserted patents.2 (Doc. No. 208.) On March 27, 7 2023, the Court denied Shoreline’s motion for partial summary judgment. (Doc. No. 226.) 8 On March 30, 2023, the Court denied Defendants’ partial motion to dismiss Plaintiffs’ 9 supplemental first amended complaint. (Doc. No. 234.) 10 On June 9, 2023, the Court dismissed Defendant Kaufman from the action with 11 prejudice pursuant to Plaintiffs’ motion. (Doc. No. 273.) On August 30, 2023, the Court 12 granted Defendant Shoreline’s motion for summary judgment of non-infringement. (Doc. 13 No. 390.) On August 31, 2023, the Court entered a judgment in favor of Defendant 14 Shoreline and against Plaintiffs Whitehead and Fate. (Doc. No. 391.) On October 16, 15 2023, the Court denied Shoreline’s motion for attorney’s fees pursuant to 35 U.S.C. § 285. 16 (Doc. No. 434.) 17 On October 26, 2023, the Clerk of Court taxed costs in the amount of $36,848.50 18 against Plaintiffs. (Doc. No. 438.) By the present motion, Plaintiffs request that the Court 19 approve Plaintiffs’ proffered supersedeas bond in the amount of $46,060.63 (1.25 times the 20 Court’s Order Taxing Costs) and that the Court stay the execution and enforcement of the 21 Court’s Order Taxing Costs until all appeals in this action are exhausted. (Doc. No. 439-1 22 at 1, 2-3.) 23 / / / 24 / / / 25 / / / 26
27 2 On April 19, 2023, the Court denied Plaintiffs’ motion for reconsideration of the 28 1 Discussion 2 “An appellant may stay execution of a judgment by posting a supersedeas bond.” 3 Clark v. Hidden Valley Lake Ass’n, No. 16-CV-02009-SI, 2018 WL 2412136, at *1 (N.D. 4 Cal. May 29, 2018) (citing Cotton ex rel. McClure v. City of Eureka, Cal., 860 F. Supp. 2d 5 999, 1025 (N.D. Cal. 2012)). Federal Rule of Civil Procedure 62(b) provides: 6 Stay by Bond or Other Security. At any time after judgment is entered, a party may obtain a stay by providing a bond or other security. The stay takes 7 effect when the court approves the bond or other security and remains in effect 8 for the time specified in the bond or other security. 9 Fed. R. Civ. P. 62(b). “‘Where a party has posted a bond acceptable to the court, the party 10 is entitled to a stay ‘as a matter of right’ under Rule 62.’” AGK Sierra de Montserrat, L.P. 11 v. Comerica Bank, No. 2:15-CV-01280-DAD-DB, 2023 WL 3582350, at *1 (E.D. Cal. 12 May 22, 2023) (quoting Jordan v. Wonderful Citrus Packing LLC, No. 13 118CV00401AWISAB, 2020 WL 7360585, at *1 (E.D. Cal. Dec. 15, 2020)); see Am. 14 Mfrs. Mut. Ins. Co. v. Am. Broad.-Paramount Theatres, Inc., 87 S. Ct. 1, 3 (1966). Rule 15 62(b)’s bond requirement “protects the prevailing [party] from the risk of a later 16 uncollectible judgment and compensates him for delay in the entry of the final judgment.” 17 N.L.R.B. v. Westphal, 859 F.2d 818, 819 (9th Cir. 1988); see also Rachel v. Banana 18 Republic, Inc., 831 F.2d 1503, 1505 n.1 (9th Cir. 1987) (“The purpose of a supersedeas 19 bond is to secure the appellees from a loss resulting from the stay of execution . . . .”). 20 “District courts have inherent discretionary authority in setting supersedeas bonds.” 21 Rachel, 831 F.2d at 1505 n.1. “Generally, ‘the amount of the bond should be sufficient to 22 pay the judgment plus interest, costs and any other relief (e.g. attorney fees) the appellate 23 court may award.’” Cotton, 860 F. Supp. 2d at 1027; see also Clark, 2018 WL 2412136, 24 at *2 (setting forth standards for determining sufficiency of the supersedeas bond). 25 Plaintiffs request that the Court approve their proffered supersedeas bond in the 26 amount of $46,060.63, which is 1.25 times the Court’s Order Taxing Costs, and that the 27 Court stay the execution and enforcement of the Court’s Order Taxing Costs until all 28 appeals in this action are exhausted. (Doc. No. 439-1 at 1, 2-3.) In response, Shoreline 1 states that it does not oppose Plaintiffs’ motion on the understanding, consistent with the 2 || declaration of Plaintiffs’ counsel, that Plaintiffs’ bond specifies that it will remain in effect 3 through the final disposition of any appeal of the Court’s judgment. (Doc. No. 443 at 1 4 ||(citing Doc. No. 439-1, Prey Decl. ¥ 3).) 5 After reviewing the parties’ briefing and arguments, the Court, exercising its sound 6 || discretion, approves Plaintiffs’ proffered supersedeas bond in the amount of $46,060.63. 7 || The proposed bond, which is 1.25 times the award in the Court’s Order Taxing Costs, is 8 sufficient and acceptable under the circumstances of this case. See Cotton, 860 F. Supp. 9 at 1027; Clark, 2018 WL 2412136, at *2. As such, the Court grants Plaintiffs’ motion. 10 Conclusion 1] For the reasons above, the Court grants Plaintiffs’ motion for approval of a 12 ||supersedeas bond and to stay the execution and enforcement of the Court’s costs award. 13 || The Court approves Plaintiffs’ proffered supersedeas bond in the amount of $46,060.63. 14 || Plaintiffs are directed to file the original bond with the Clerk of Court within fourteen days 15 || from the date this order is filed. Upon the posting of the approved $46,060.63 supersedeas 16 |/bond, the Court stays the execution and enforcement of the Court’s Order Taxing Costs 17 || until all appeals in this action are exhausted. 19 || DATED: December 4, 2023 | | | ul | | | 20 MARILYN W. HUFF, Distri ge 21 UNITED STATES DISTRICT COURT 22 23 24 25 26 27 28