JUUL Labs Incorporated v. NJOY LLC, et al.

• Court: District Court, D. Arizona
• Decided: November 20, 2025
• Docket: 2:25-cv-02853
• Status: Unknown

Opinion

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA

9 JUUL Labs Incorporated, No. CV-25-02853-PHX-JJT

10 Plaintiff, ORDER

11 v.

12 NJOY LLC, et al.,

13 Defendants. 14 15 At issue is Plaintiff JUUL Labs Incorporated’s Motion to Stay (Doc. 25), to which 16 Defendants NJOY, LLC, NJOY Holdings, Inc., Altria Group, Inc., Altria Group 17 Distribution Company, and Altria Client Services LLC responded (Doc. 26), and Plaintiff 18 replied (Doc. 30). The Court finds this matter appropriate for decision without oral 19 argument. See LRCiv 7.2(f). For the reasons below, the Court will grant in part and deny 20 in part Plaintiff’s Motion. 21 I. BACKGROUND 22 This case arises from the purported infringement of Plaintiff’s U.S. Patent Number 23 12,156,533 (“533 Patent”), which is the subject of a parallel action before the International 24 Trade Commission in Investigation Number 337-TA-1460 (“ITC Action”). According to 25 Plaintiff, the ITC Action has been scheduled for a Markman hearing on January 8, 2026, 26 an evidentiary hearing the week of April 22, 2026, an initial determination on 27 September 11, 2026, and a final determination on January 12, 2027. (Mot. at 3; Doc. 25-1 28 at 57; Reply at 3.) 1 When, as here, an ITC matter occurs simultaneously with a civil action involving 2 the same parties and issues, the responding party may request a mandatory stay of the civil 3 action. 28 U.S.C.S. § 1659(a). The mandatory stay of the civil action persists only until the 4 ITC issues its final determination and the parties exhaust all appeals of that determination. 5 In re Princo Corp., 486 F.3d 1365, 1367–69 (Fed. Cir. 2007). Pursuant to § 1659(a), 6 Defendants could have invoked a mandatory stay of these proceedings while the ITC 7 Action ensued but did not. Plaintiff now moves this Court to issue a discretionary stay of 8 this matter while the ITC Action takes place, which Defendants strongly oppose. 9 II. LEGAL STANDARD 10 “[T]he power to stay proceedings is incidental to the power inherent in every court 11 to control the disposition of the cases on its docket with economy of time and effort for 12 itself, for counsel, and for litigants.” Landis v. N. Am. Co., 299 U.S. 248, 254 (1936). When 13 considering a motion to stay proceedings under Landis, courts must weigh “competing 14 interests,” id. at 255, which include “the possible damage which may result from the 15 granting of a stay, the hardship or inequity which a party may suffer in being required to 16 go forward, and the orderly course of justice measured in terms of the simplifying or 17 complicating of issues, proof, and questions of law which could be expected to result from 18 a stay.” Lockyer v. Mirant Corp., 398 F.3d 1098, 1110 (9th Cir. 2005) (quoting CMAX, 19 Inc. v. Hall, 300 F.2d 265, 268 (9th Cir. 1962)). 20 A. Factor One: Possible Damage of Granting Stay 21 Defendants argue that they will endure substantial damage if a stay is granted 22 because their products, if found to infringe the 533 Patent by the ITC, will be excluded 23 from importation. (Resp. at 8.) It is true that the ITC is authorized to determine whether 24 imported articles infringe upon a United States patent and, if so, order the exclusion of 25 those infringing articles from entry into the United States. 19 U.S.C.S. § 1337(a)(1)(B)(i), 26 (d). While Defendants fairly depict a possible outcome of the ITC Action, the Court notes 27 that exclusion of their products from importation is no more severe than the relief Plaintiff 28 seeks in the instant matter, which includes “entry of a permanent injunction enjoining 1 Defendants from directly or indirectly . . . importing the products at issue.” (Doc. 1 at 22.) 2 In other words, the damage identified by Defendants is just as possible if the stay is denied 3 as if it is granted. 4 Defendants are not without avenues of relief from an adverse ITC determination, 5 either. Those determinations are appealable in accordance with 19 U.S.C.S. § 1337(c) and 6 the Administrative Procedure Act, 5 U.S.C. §§ 701–06. And while Defendants are 7 concerned that the administrative appeals process may be years’ long until this matter 8 returns to the Court (Resp. at 8), this future delay is highly speculative and minimized by 9 the swift pace in which the ITC Action is currently progressing in comparison to the matter 10 at bar. Aliphcom v. Fitbit, Inc., 154 F. Supp. 3d 933, 938 (N.D. Cal. 2015) (“Here, any 11 generalized risk of delayed litigation is minimized by the fact that the ITC proceeding is 12 moving forward on a comparatively expedited schedule.”). 13 Defendants cite numerous cases for the proposition that the possible damage of a 14 stay is worsened by the competitive relationship between the parties. As Plaintiff points 15 out, those cases discuss prejudice to a patentee suffering ongoing harm from the continued 16 violation of its patent by a competitor. See Kaneka Corp. v. SKC Kolon PI, Inc., No. CV 17 11-3397 JGB (RZx), 2014 LX 20964, at *10 (C.D. Cal. Dec. 5, 2014) (citing cases that 18 address prejudice of a stay to a patentee); Pipe Restoration Techs., LLC v. Pipeline 19 Restoration Plumbing, Inc., No. SACV 13-00499-CJC(RNBx), 2015 U.S. Dist. LEXIS 20 136500, at *6 (C.D. Cal. Feb. 13, 2015); Netlist, Inc. v. Micron Tech., Inc., No. 2:22-cv- 21 203-JRG-RSP, 2024 LX 125502, at *5 (E.D. Tex. Jan. 3, 2024) (noting that a stay may 22 have “outsized consequences to the party asserting infringement has occurred”). This 23 distinction is important because “[s]taying a case while such harm is ongoing usually 24 prejudices the patentee that seeks timely enforcement of its right to exclude.” Universal 25 Elecs., Inc. v. Universal Remote Control, Inc., 943 F. Supp. 2d 1028, 1034 (C.D. Cal. 2013) 26 (citation and internal quotation marks omitted). Here, Defendants do not hold the 533 27 Patent and, aside from citing the inapposite cases described above, offer no explanation as 28 to how their competition against Plaintiff damages them if a stay was granted in this matter. 1 Defendants next argue that they will be harmed by the ongoing “cloud of 2 uncertainty” of whether they have, in fact, infringed the 533 Patent if a stay is granted. 3 (Resp. at 8–9.) This argument is unpersuasive. District courts in this Circuit have declined 4 to presume harm from a generic and unspecified “litigation cloud.” Aliphcom, 154 F. Supp. 5 3d at 938; Google Inc. v. Creative Labs, Inc., No. 16-cv-02628-JST, 2016 U.S. Dist. LEXIS 6 163696, *5 (N.D. Cal. Nov. 28, 2016); see e.g., Lockyer, 398 F.3d at 1112 (“[B]eing 7 required to defend a suit does not constitute a clear case of hardship or inequity within the 8 meaning of Landis.”) (internal quotation marks omitted). Defendants do not specify with 9 any detail what harm they would experience from not being able to clear the elusive “cloud 10 of uncertainty.” To the extent that Defendants are concerned about delay, the Court notes 11 that the ITC Action is progressing with haste and the parties are set to hold a Markman 12 hearing in two months’ time. Meanwhile, this Court has yet to hold a scheduling 13 conference. Given the current timeline of these parallel actions, the ITC Action is more 14 likely to clear the “cloud of uncertainty” quicker than the proceedings held in this Court. 15 In sum, Defendants fail to show that they will suffer a possibility of damage if this matter 16 is stayed, so this factor is neutral. 17 B. Factor Two: Hardship or Inequity of Denying Stay 18 Plaintiff argues that the financial burden of litigating in two forums at once will 19 impose a hardship onto Plaintiff. (Mot. at 7.) However, “being required to defend a suit,” 20 or in this case, prosecute one’s own claims, “does not constitute a clear case of hardship or 21 inequity within the meaning of Landis.” Lockyer, 398 F.3d at 1112 (internal quotation 22 marks omitted). The remainder of Plaintiff’s argument addresses “hardship to the judicial 23 system” (Mot. at 8; Reply at 8–9), which is more aptly related to the third Landis factor 24 discussed below. Plaintiff fails to show that it will suffer hardship or inequity if required 25 to proceed in this matter, so this factor is neutral. 26 C. Factor Three: Orderly Course of Justice 27 Plaintiff argues that a stay will promote the orderly course of justice because the 28 ITC Action will develop a record that will simplify the issues in this matter. (Mot. at 5.) 1 According to Plaintiff, the underlying policy of § 1659(a) supports a discretionary stay 2 because its purpose is to prevent inconsistent results from the patent infringement claims 3 occurring in two forums simultaneously. (Id. at 6.) 4 The Court agrees that the § 1659(a) policy does provide at least some support for a 5 discretionary stay. The legislature clearly intended for the courts to avoid the risk of 6 inconsistent outcomes between parallel proceedings and that risk is no lesser simply 7 because the stay is requested by a complainant rather than a respondent. Further, an ITC 8 determination and a resulting Federal Circuit appeal may be helpful to the parties and the 9 Court in narrowing the issues at bar. Tillman & Bendel, Inc. v. Cal. Packing Corp., 63 F.2d 10 498, 503 (9th Cir. 1933) (“[A] well considered opinion by that federal tribunal, upon an 11 issue so peculiarly within its province, is entitled to persuasive effect upon this court.”); 12 Aliphcom, 154 F. Supp. 3d at 939 (granting a stay and noting that the court would benefit 13 from an ITC determination); FormFactor, Inc. v. Micronics Japan Co., No. CV-06-07159 14 JSW, 2008 U.S. Dist. LEXIS 13114, *10 (N.D. Cal. Feb. 11, 2008) (noting that a stay “will 15 be the most prudential course of action if it is likely that the issues resolved in the ITC 16 hearing will bear ‘upon the highly technical . . . questions which are likely to arise in the 17 district court case.’”) (quoting CMAX, Inc., 300 F.2d at 269); Google Inc., 2016 U.S. Dist. 18 LEXIS 163696 at *8. 19 However, as Defendants correctly point out (Resp. at 5), ITC determinations and 20 appeals therefrom are not binding upon this Court. Whether or not a determination reached 21 in the ITC Action will ultimately be persuasive as to dispositive issues here depends on the 22 weight, if any, this Court assigns to it. Zenith Elecs. LLC v. Sony Corp., No. C 11-02439 23 WHA, 2011 U.S. Dist. LEXIS 79976, *9 (N.D. Cal. Jul. 22, 2011). Still, the ITC Action 24 relates to the same patent and conduct at issue here and, whether or not the Court ultimately 25 reaches the same conclusion as the ITC, an ITC determination, record, and possible appeal 26 are likely to simplify—not complicate—the issues at bar. Google Inc., 2016 U.S. Dist. 27 LEXIS 163696 at *8 (discussing the benefit of the ITC record and noting that “Congress 28 1 thought that district courts would benefit from the guidance of the ITC and Federal Circuit, 2 even if those decisions are only persuasive”). This factor weighs in favor of granting a stay. 3 III. CONCLUSION 4 The Court will grant a stay, but only in part. With discovery and disclosure efforts 5 well underway in the ITC Action (Resp. at 3; Reply at 3), it is appropriate for the parties 6 to engage in initial disclosures, fact discovery, and claim construction briefing here. By the 7 Court’s estimation, this is the most practical and fairest way to ensure this matter proceeds 8 in a just, speedy and inexpensive fashion while avoiding needlessly inconsistent rulings 9 with the parallel ITC Action. See Fed. R. Civ. P. 1. 10 At the upcoming Rule 16 Scheduling Conference, the Court will set pretrial 11 deadlines short of the Markman hearing and completion of fact discovery. The Court will 12 also set a deadline for the parties to file a joint report regarding the status of the Markman 13 hearing occurring in the ITC Action and whether an extension of the partial stay is 14 appropriate. All other disclosure, settlement, and dispositive motion deadlines that 15 traditionally follow a Markman hearing in this Court are hereby stayed until either the 16 parties’ joint report deadline or resolution of the ITC Action, whichever comes first. Should 17 the ITC Action resolve while this matter is pending, the parties shall file a joint notice of 18 resolution with the Court no later than seven days thereafter. 19 IT IS THEREFORE ORDERED granting in part and denying in part Plaintiff 20 JUUL Labs Incorporated’s Motion to Stay (Doc. 25). 21 IT IS FURTHER ORDERED staying all disclosure, settlement, and dispositive 22 motion deadlines that traditionally follow a Markman hearing in this Court until either the 23 parties’ joint report deadline—which will be set at the upcoming Rule 16 Scheduling 24 Conference—or resolution of the parallel Internal Trade Commission Investigation 25 Number 337-TA-1460, whichever comes first. Should the parallel ITC matter resolve while

26 27 28 1 || this matter is pending, the parties shall file a joint notice of resolution no later than seven || days thereafter. 3 Dated this 19th day of November, 2025. CN

Unie States#District Judge 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

-7-