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10 GOLDEN EYE MEDIA USA, INC., a ) Case No.: 3:18-cv-02109-BEN-LL California corporation, ) 11 ) ORDER DENYING PLAINTIFF’S Plaintiff, 12 ) MOTION TO STAY LITIGATION v. ) PENDING RE-EXAMINATION OF 13 TROLLEY BAGS UK LTD, a ) U.S. PATENT NO. D779,828 14 corporation of the United Kingdom; and ) BERGHOFF INTERNATIONAL, ) [ECF Nos. 119, 122, 123] 15 INC., a Florida corporation, ) 16 Defendant. ) 17 TROLLEY BAGS UK LTD, a ) corporation of the United Kingdom; and ) 19 INC., a Florida corporation, ) ) 20 Counterclaimants, ) 21 v. ) ) 22 GOLDEN EYE MEDIA USA, INC., a ) California corporation; FARZAN 23 DEHMOUBED, an individual; and ) ) 24 JENNIFER DUVALL, an individual, )
25 Counterdefendants. ) ) 26 I. INTRODUCTION 27 Plaintiff/Counterdefendant GOLDEN EYE MEDIA USA, INC., a California 28 1 corporation (“Plaintiff”) brings this action for a declaratory judgment of non-infringement 2 against Defendants/Counterclaimants TROLLEY BAGS UK LTD, a corporation of the 3 United Kingdom (“Trolley Bags”); and BERGHOFF INTERNATIONAL, INC., a Florida 4 corporation (“Berghoff”) (collectively, “Defendants”). ECF No. 1. 5 Before the Court is Plaintiff’s Motion to Stay Litigation Pending Reexamination of 6 U.S. Patent No. D779,828 (the “Motion”). ECF No. 119. The Motion was submitted on 7 the papers without oral argument pursuant to Civil Local Rule 7.1(d)(1) and Rule 78(b) of 8 the Federal Rules of Civil Procedure. ECF No. 128. After considering the papers 9 submitted, supporting documentation, and applicable law, the Court DENIES the Motion. 11 This matter arises out of a dispute over whether Plaintiff is infringing on the claim 12 of U.S. Design Patent No. D779,828 (the “828 Patent”) as well as the trademark held by 13 Defendant Trolley Bags. Complaint, ECF No. 1 (“Compl.”) at 2:7-91; see also Answer, 14 ECF No. 14 (“Ans.”) at 9:24-27. Both parties have asserted various patent, trademark, and 15 business tort claims for relief against each other. See Compl., ECF No. 1; ECF No. 33. A 16 detailed factual and procedural history is set forth in the Court’s previous order and is 17 incorporated by reference. See ECF No. 136. 18 On September 18, 2020, all parties in this case filed cross-motions for summary 19 judgment. ECF Nos. 80, 83. However, on October 28, 2020, while those motions were 20 pending, the United States Patent and Trademark Office (the “UPSTO”) granted a Request 21 for Reexamination on the sole claim of the 828 Patent. Mot. at 119-1 at 2:5-8. 22 On December 9, 2020, Plaintiff filed a Motion to Stay this case pending 23 reexamination of the 828 Patent. Motion, ECF No. 119 (“Mot.”). 24 On January 9, 2021, while the Motion to Stay was pending, this Court issued a 25 Minute Order vacating the February 22, 2021 jury trial date in this matter, due to the 26 COVID-19 pandemic and recent orders of the Chief Judge of the Southern District of 27 1 Unless otherwise indicated, all page number references are to the ECF generated 28 1 California, suspending jury trials. ECF No. 121. The Court committed to re-scheduling 2 the jury trial date once jury trials were allowed to resume. Id. 3 On January 11, 2021, Defendants and Counterclaimants opposed the Motion to Stay, 4 arguing, in part, that the fact that the Court had vacated the trial date weight against granting 5 a stay. Opposition, ECF No. 122 (“Oppo.”). On January 19, 2021, Plaintiff replied, 6 reiterating its arguments for a stay despite the Court having vacated the trial date. Reply, 7 ECF No. 123 (“Reply”). 8 On March 12, 2021, the Court granted-in-part both parties’ motions for summary 9 judgment in this matter, holding that the 828 Patent is invalid, and even if it were valid, it 10 had not been infringed. ECF No. 136. 12 A court’s power to stay proceedings is incidental to the inherent power to control the 13 disposition of its cases in the interests of efficiency and fairness to the court, counsel, and 14 litigants. Landis v. N. Am. Co., 299 U.S. 248, 254-55 (1936). A stay may be granted 15 pending the outcome of other legal proceedings related to the case in the interests of judicial 16 economy. Leyva v. Certified Grocers of Cal., Ltd., 593 F.2d 857, 863-64 (9th Cir. 1979). 17 Discretion to stay a case is appropriately exercised when the resolution of another matter 18 will have a direct impact on the issues before the court, thereby substantially simplifying 19 the issues presented. Mediterranean Enters., Inc. v. Ssangyong Corp., 708 F.2d 1458, 1465 20 (9th Cir. 1983). In determining whether a stay is appropriate, a district court “must weigh 21 competing interests and maintain an even balance.” Landis, 299 U.S. at 254-55. “[I]f there 22 is even a fair possibility that the stay … will work damage to some one else, the stay may 23 be inappropriate absent a showing by the moving party of hardship or inequity.” 24 Dependable Highway Express, Inc. v. Navigators Ins. Co., 498 F.3d 1059, 1066 (9th Cir. 25 2007) (citation and internal quotation marks omitted). 26 In deciding whether to grant a stay pending reexamination of a patent by the USPTO, 27 the court considers whether (1) a stay will simplify the issues in the case and streamline 28 trial, (2) discovery is complete and a trial date has been set, and (3) a stay would unduly 1 prejudice the moving party or provide the moving party with a clear tactical advantage. 2 Audatex N. Am. Inc. v. Mitchell Int’l Inc., 46 F. Supp. 3d 1019, 1021 (S.D. Cal. 2014). 4 Plaintiff seeks to stay this case by arguing that in light of the USPTO’s decision to 5 grant re-examination of the 828 Patent, “there is no reason for the parties and the Court to 6 continue to expend time and resources on these patent claims while the Reexamination 7 proceedings are pending.” Mot. at 2:5-13. Plaintiff argues that the three factors courts 8 should consider when deciding to grant a stay weigh in favor of a stay: First, Plaintiff 9 initiated this case by seeking a judgment of non-infringement, so “it is possible that 10 Defendants would never would have initiated a claim for patent infringement,” as they did 11 by counterclaim, had Plaintiff not field suit first. Id. at 2:28-3:2. Further, Defendants 12 delayed over a year before alleging infringement via counterclaims in this Court, so they 13 cannot not claim a short delay would prejudice them. Id. at 2:28-3:14. Second, Plaintiff 14 argues a stay will simplify issues because the USPTO may invalidate the 828 Patent, 15 rendering Defendant’s claim moot. Id. at 3:15-26. Third, even though the parties have 16 participated in discovery and pretrial motion practice, and trial was approaching, “the 17 proximity of the trial date, by itself, does not preclude the entry of stay.” Id. at 3:27-4:4. 18 Defendants oppose the stay, arguing that it is unwarranted, and that the Court should 19 “deny Plaintiff’s Motion and schedule trial to begin as soon as reasonably practical after 20 the COVID-19 pandemic has improved.” Oppo. at 5:5-8. Defendants argue that first, a 21 stay would severely prejudice them as “Plaintiff’s infringement has caused substantial 22 harm to Defendants since at least July 2017,” and “staying this case indefinitely while that 23 harm is ongoing will unduly prejudice Defendants by hindering them from timely 24 enforcing their right to exclude.” Id. at 9:7-17.
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10 GOLDEN EYE MEDIA USA, INC., a ) Case No.: 3:18-cv-02109-BEN-LL California corporation, ) 11 ) ORDER DENYING PLAINTIFF’S Plaintiff, 12 ) MOTION TO STAY LITIGATION v. ) PENDING RE-EXAMINATION OF 13 TROLLEY BAGS UK LTD, a ) U.S. PATENT NO. D779,828 14 corporation of the United Kingdom; and ) BERGHOFF INTERNATIONAL, ) [ECF Nos. 119, 122, 123] 15 INC., a Florida corporation, ) 16 Defendant. ) 17 TROLLEY BAGS UK LTD, a ) corporation of the United Kingdom; and ) 19 INC., a Florida corporation, ) ) 20 Counterclaimants, ) 21 v. ) ) 22 GOLDEN EYE MEDIA USA, INC., a ) California corporation; FARZAN 23 DEHMOUBED, an individual; and ) ) 24 JENNIFER DUVALL, an individual, )
25 Counterdefendants. ) ) 26 I. INTRODUCTION 27 Plaintiff/Counterdefendant GOLDEN EYE MEDIA USA, INC., a California 28 1 corporation (“Plaintiff”) brings this action for a declaratory judgment of non-infringement 2 against Defendants/Counterclaimants TROLLEY BAGS UK LTD, a corporation of the 3 United Kingdom (“Trolley Bags”); and BERGHOFF INTERNATIONAL, INC., a Florida 4 corporation (“Berghoff”) (collectively, “Defendants”). ECF No. 1. 5 Before the Court is Plaintiff’s Motion to Stay Litigation Pending Reexamination of 6 U.S. Patent No. D779,828 (the “Motion”). ECF No. 119. The Motion was submitted on 7 the papers without oral argument pursuant to Civil Local Rule 7.1(d)(1) and Rule 78(b) of 8 the Federal Rules of Civil Procedure. ECF No. 128. After considering the papers 9 submitted, supporting documentation, and applicable law, the Court DENIES the Motion. 11 This matter arises out of a dispute over whether Plaintiff is infringing on the claim 12 of U.S. Design Patent No. D779,828 (the “828 Patent”) as well as the trademark held by 13 Defendant Trolley Bags. Complaint, ECF No. 1 (“Compl.”) at 2:7-91; see also Answer, 14 ECF No. 14 (“Ans.”) at 9:24-27. Both parties have asserted various patent, trademark, and 15 business tort claims for relief against each other. See Compl., ECF No. 1; ECF No. 33. A 16 detailed factual and procedural history is set forth in the Court’s previous order and is 17 incorporated by reference. See ECF No. 136. 18 On September 18, 2020, all parties in this case filed cross-motions for summary 19 judgment. ECF Nos. 80, 83. However, on October 28, 2020, while those motions were 20 pending, the United States Patent and Trademark Office (the “UPSTO”) granted a Request 21 for Reexamination on the sole claim of the 828 Patent. Mot. at 119-1 at 2:5-8. 22 On December 9, 2020, Plaintiff filed a Motion to Stay this case pending 23 reexamination of the 828 Patent. Motion, ECF No. 119 (“Mot.”). 24 On January 9, 2021, while the Motion to Stay was pending, this Court issued a 25 Minute Order vacating the February 22, 2021 jury trial date in this matter, due to the 26 COVID-19 pandemic and recent orders of the Chief Judge of the Southern District of 27 1 Unless otherwise indicated, all page number references are to the ECF generated 28 1 California, suspending jury trials. ECF No. 121. The Court committed to re-scheduling 2 the jury trial date once jury trials were allowed to resume. Id. 3 On January 11, 2021, Defendants and Counterclaimants opposed the Motion to Stay, 4 arguing, in part, that the fact that the Court had vacated the trial date weight against granting 5 a stay. Opposition, ECF No. 122 (“Oppo.”). On January 19, 2021, Plaintiff replied, 6 reiterating its arguments for a stay despite the Court having vacated the trial date. Reply, 7 ECF No. 123 (“Reply”). 8 On March 12, 2021, the Court granted-in-part both parties’ motions for summary 9 judgment in this matter, holding that the 828 Patent is invalid, and even if it were valid, it 10 had not been infringed. ECF No. 136. 12 A court’s power to stay proceedings is incidental to the inherent power to control the 13 disposition of its cases in the interests of efficiency and fairness to the court, counsel, and 14 litigants. Landis v. N. Am. Co., 299 U.S. 248, 254-55 (1936). A stay may be granted 15 pending the outcome of other legal proceedings related to the case in the interests of judicial 16 economy. Leyva v. Certified Grocers of Cal., Ltd., 593 F.2d 857, 863-64 (9th Cir. 1979). 17 Discretion to stay a case is appropriately exercised when the resolution of another matter 18 will have a direct impact on the issues before the court, thereby substantially simplifying 19 the issues presented. Mediterranean Enters., Inc. v. Ssangyong Corp., 708 F.2d 1458, 1465 20 (9th Cir. 1983). In determining whether a stay is appropriate, a district court “must weigh 21 competing interests and maintain an even balance.” Landis, 299 U.S. at 254-55. “[I]f there 22 is even a fair possibility that the stay … will work damage to some one else, the stay may 23 be inappropriate absent a showing by the moving party of hardship or inequity.” 24 Dependable Highway Express, Inc. v. Navigators Ins. Co., 498 F.3d 1059, 1066 (9th Cir. 25 2007) (citation and internal quotation marks omitted). 26 In deciding whether to grant a stay pending reexamination of a patent by the USPTO, 27 the court considers whether (1) a stay will simplify the issues in the case and streamline 28 trial, (2) discovery is complete and a trial date has been set, and (3) a stay would unduly 1 prejudice the moving party or provide the moving party with a clear tactical advantage. 2 Audatex N. Am. Inc. v. Mitchell Int’l Inc., 46 F. Supp. 3d 1019, 1021 (S.D. Cal. 2014). 4 Plaintiff seeks to stay this case by arguing that in light of the USPTO’s decision to 5 grant re-examination of the 828 Patent, “there is no reason for the parties and the Court to 6 continue to expend time and resources on these patent claims while the Reexamination 7 proceedings are pending.” Mot. at 2:5-13. Plaintiff argues that the three factors courts 8 should consider when deciding to grant a stay weigh in favor of a stay: First, Plaintiff 9 initiated this case by seeking a judgment of non-infringement, so “it is possible that 10 Defendants would never would have initiated a claim for patent infringement,” as they did 11 by counterclaim, had Plaintiff not field suit first. Id. at 2:28-3:2. Further, Defendants 12 delayed over a year before alleging infringement via counterclaims in this Court, so they 13 cannot not claim a short delay would prejudice them. Id. at 2:28-3:14. Second, Plaintiff 14 argues a stay will simplify issues because the USPTO may invalidate the 828 Patent, 15 rendering Defendant’s claim moot. Id. at 3:15-26. Third, even though the parties have 16 participated in discovery and pretrial motion practice, and trial was approaching, “the 17 proximity of the trial date, by itself, does not preclude the entry of stay.” Id. at 3:27-4:4. 18 Defendants oppose the stay, arguing that it is unwarranted, and that the Court should 19 “deny Plaintiff’s Motion and schedule trial to begin as soon as reasonably practical after 20 the COVID-19 pandemic has improved.” Oppo. at 5:5-8. Defendants argue that first, a 21 stay would severely prejudice them as “Plaintiff’s infringement has caused substantial 22 harm to Defendants since at least July 2017,” and “staying this case indefinitely while that 23 harm is ongoing will unduly prejudice Defendants by hindering them from timely 24 enforcing their right to exclude.” Id. at 9:7-17. Second, Defendant argues that a stay will 25 not simplify issues for trial because “most of Defendant’s claims are not subject to the 26 reexamination (i.e., trademark infringement, interference with prospective contractual 27 economic relations; negligent misrepresentation; statutory unfair competition; and 28 common law unfair competition).” Oppo. at 12:12-17. Third, Defendants argue that this 1 || case is ready for trial, and protracted stay for the duration of reexamination proceedings 1s 2 |}unwarranted. /d. at 14:28-15:5. 3 In reply, Plaintiff acknowledge that since it filed its motion, the Court vacated the 4 || trial date—as postponing trial was a large argument in Plaintiff's original Motion; however, 5 || Plaintiff continues to argue that a stay should still be granted “to conserve the parties and 6 || the Court’s time and resources.” Reply at 2:16-19. 7 The Court finds that in light of the Court’s ruling finding the 828 Patent both invalid 8 || and not infringed, see ECF No. 133, the primary basis for Plaintiff’s Motion for a Stay □□□□□ 9 || to allow the USPTO to determine the validity of the 828 Patent and limit issues for trial) is 10 ||moot. See, e.g., Tur v. YouTube, Inc., 562 F.3d 1212, 1214 (9th Cir. 2009) (holding that 11 |}courts “conclude that an issue is moot when deciding it would have no effect within the 12 || confines of the case itself’). The Court has already invalidated the 828 Patent.” As a result, 13 stay will neither simplify the issues in this case nor streamline trial. Further, the parties 14 prepared for trial, having already completed discovery, filed motions for summary 15 ||judgment, and submitted motions in limine. Accordingly, the Court finds a stay would be 16 ||improper in addition to unduly prejudicing Defendants. 17||V. CONCLUSION 18 For the above reasons, Plaintiff's Motion to Stay the Case Pending Reexamination 19 || of the 828 Patent is DENIED. 21 DATED: March 15, 2021 ON. ROGER T. BENITE United States District Judge 23 24 While the parties may still pursue their reexamination proceeding, Defendants must 25 ||inform the USPTO of the Court’s decision, at which point the Director will determine whether or not to suspend reexamination proceedings. See 37 C.F.R. 8 1.565(a)-(b). This 76 because while the USPTO may accord deference to the Court’s factual findings, the 27 || presumption of validity does not apply to reexamination proceedings, Jn re Etter, 756 F.2d 852, 857 (Fed. Cir. 1985), and the USPTO applies different standards of review, Jn re 28 Swanson, 540 F.3d 1368, 1379 (Fed. Cir. 2008). 5-