Stay Pending Resolution of Covered Business Method Review Denied Where Case Was Narrow and Trial Date Was Already Set

Plaintiff SecureBuy, LLC ("SecureBuy") filed a Motion to Stay Proceedings pending resolution of a Covered Business Methods ("CBM") review at the Patent Trial and Appeals Board ("PTAB"). When the motion was stayed, the PTAB had not yet granted review of the CBM petition.

Before ruling on the stay request, the district court had previously heard argument on defendant's motion for preliminary injunction or in the alternative for expedited discovery and an expedited trial. The district court denied the preliminary injunction but granted Defendant's request to expedite the case and scheduled trial for August of 2014. When it opposed the preliminary injunction and expedited trial, SecureBuy made similar arguments as it raised in its motion to say pending the CBM review, which the district court considered when ruling on the previous motion.

After reciting the standards for deciding whether to stay litigation pending a CBM review, the district court made certain findings and determined that a stay was not appropriate. "Courts consider four factors when deciding whether to stay litigation pending CBM review: (1) whether a stay will simplify the issues, (2) whether discovery is complete and a trial date is set, (3) whether there will be undue prejudice to the non-moving party, and (4) whether a stay will reduce the burden on the Court and the parties. See AIA § 18(b)(1). In granting Defendant's request for an expedited trial schedule, the Court considered each of these factors and found, among other things, that '[t]he defendant's allegations about harm . . . are pertinent to a decision as to how quickly to move this case along. And also quite importantly here is that the case appears to be relatively narrow and the parties appear to be far along [compared] to where most cases are a couple months after they have been filed.'"

In denying the request for a stay, the district court also found that "[i]n addition to the reasons articulated in the transcript ruling and elsewhere in this Order, the Court finds: (1) this case is already narrowed and somewhat "simplified" and, given that not even all invalidity defenses are part of the CBM request (and infringement, of course, is also not part of that request), the simplification factor does not favor a stay; (2) discovery is underway and trial is set for less than five months from now, so the second factor does not favor a stay; (3) a stay would unduly prejudice Defendant; and (4) because of the somewhat unique posture of this case, a stay would not reduce the burden on the Court (which will have to alter the schedule already entered when, most likely, something remains of this case even after completion of CBM review) and, given the prejudice of delaying resolution of the litigation, would not reduce the burden on at least Defendant."

Accordingly, the district court denied the request for the stay pending CBM review.

Securebuy, LLC v. Cardinal Commerce Corporation, No. 13-1792-LPS (D. Del. March 21, 2014)


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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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