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Neste Oil Oyj v. Dynamic Fuels, LLC

United States District Court, Third Circuit

July 2, 2013

NESTE OIL OYJ, Plaintiff,
v.
DYNAMIC FUELS, LLC, SYNTROLEUM CORPORATION, and TYSON FOODS, INC., Defendants.

MEMORANDUM

GREGORY M. SLEET, Chief District Judge.

I. INTRODUCTION

The plaintiff, Neste Oil Oyj ("Neste") brought this patent infringement suit against Dynamic Fuels, LLC ("Dynamic Fuels"), Syntroleum Corporation ("Syntroleum"), and Tyson Foods, Inc. ("Tyson Foods") on December 21, 2012, alleging infringement of U.S. Patent No. 8, 212, 094 (the "094 Patent"). (D.I. 1.) On March 8, 2013, Syntroleum filed a petition for inter partes review of the 094 Patent with the U.S. Patent and Trademark Office ("the PTO"). (D.I. 18 at 1.) The defendants then filed the present Motion to Stay Litigation Pending Inter Partes Review of the Patent-In-Suit on March 13, 2013. (D.I. 17.) For the reasons that follow, the court will grant the defendants' motion and order a stay of the litigation pending inter partes review of the 094 Patent.

II. BACKGROUND

Neste is the owner of the 094 Patent, which is titled "Process for the Manufacture of Diesel Range Hydrocarbons." (D.I. 19 at Ex. 1.) The 094 Patent is directed to the manufacture of diesel range hydrocarbons from a fresh feed stream consisting of bio-renewable feedstock such as oils or fats from plants and/or animals. (D.I. 24 at 2.) Neste alleges that the defendants produce a competing renewable biodiesel product employing a process that directly infringes the 094 Patent. (D.I. 1 at ΒΆ 15.) An earlier infringement action filed by Neste against the defendants remains pending in this court.[1]

III. STANDARD OF REVIEW

A decision to stay litigation lies within the sound discretion of the court and represents an exercise of the court's "inherent power to conserve judicial resources by controlling its own docket." See Cost Bros., Inc. v. Travelers Indem. Co., 760 F.2d 58, 60 (3d Cir. 1985); Nokia Corp. v. Apple, Inc., No. 09-791-GMS, 2011 WL 2160904, at *1 (D. Del. June 1, 2011); Wall Corp. v. BondDesk Group, L.L.C., No. 07-844-GMS, 2009 WL 528564, at *1 (D. Del. Feb. 24, 2009). It is well settled that this authority extends to patent cases in which a review by the PTO has been requested. Ethicon, Inc. v. Quigg, 849 F.2d 1422, 1426-27 (Fed. Cir. 1988) ("Courts have inherent power to manage their dockets and stay proceedings, including the authority to order a stay pending conclusion of a PTO reexamination.").

The court considers the following three factors when deciding whether to stay a case: "(1) whether a stay would unduly prejudice or present a clear tactical disadvantage to the non-moving party; (2) whether a stay will simplify the issues in question and trial of the case; and (3) whether discovery is complete and whether a trial date has been set." First Am. Title Ins. Co. v. McLaren LLC, 2012 WL 769601, at *4 (D. Del. Mar. 9, 2012) (quoting Xerox Corp. v. 3 Corn Corp., 69 F.Supp.2d 404, 406 (W.D.N.Y. 1999)).

IV. DISCUSSION

The court finds that these three factors, when taken together, favor granting the defendants' motion to stay. The court will discuss each consideration in turn.

A. Undue Prejudice

The first factor the court weighs is whether granting a stay would cause the non-moving party undue prejudice or place it at a clear tactical disadvantage. The court notes that staying a case pending PTO review risks prolonging the final resolution of the dispute and thereby may result in some inherent prejudice to the plaintiff. Textron Innovations, Inc. v. Taro Co., No. 05-486-GMS, 2007 WL 7772169, at *2 (D. Del. Apr. 25, 2007). The mere potential for delay, however, is insufficient to establish undue prejudice. See SenoRx, Inc. v. Hologic, Inc., No. 12-173-LPS-CJB, 2013 WL 144255, at *7 (D. Del. Jan. 11, 2013); Enhanced Sec. Research, LLC v. Cisco Sys., Inc., No. 09-571-JJF, 2010 WL 2573925, at *3 (D. Del. June 25, 2010). To better gauge the likelihood of such prejudice arising, the court has considered a number of sub-factors, including "the timing of the request for reexamination, the timing of the request for stay, the status of the reexamination proceedings and the relationship of the parties." Boston Scientific Corp. v. Cordis Corp., 777 F.Supp.2d 783, 789 (D. Del. 2011).

1. Timing of the review and stay requests

Courts have expressed reluctance to grant a stay where the timing of the request for PTO review or reexamination suggests a dilatory intent on the movant's part. See Belden Techs. Inc. v. Superior Essex Cornrnc'ns LP, No. 08-63-SLR, 2010 WL 3522327, at *2 (D. Del. Sept. 2, 2010) ("A request for reexamination made well after the onset of litigation followed by a subsequent request to stay may lead to an inference that the moving party is seeking an inappropriate tactical advantage.") Likewise, a delay in filing a motion to stay may indicate that the movant sought to gain an improper tactical advantage. See St. Clair Intellectual Prop. Consultants, Inc. v. Sony Corp., No. 01-557-JJF, 2003 WL 25283239, at *1 (D. Del. Jan. 30, 2003) (noting "the fact that the instant ...


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