PersonalWeb Technologies LLC v. EMC Corporation

Background

PersonalWeb Technologies and Level 3 Communications filed the motion. They asked the court to stay, or pause, EMC Corporation and VMware, Inc.’s motion for attorneys’ fees and costs while the Federal Circuit considered plaintiffs’ appeal.

The case originally asserted eight patents. The court had previously stayed the case while the U.S. Patent and Trademark Office conducted inter partes reviews, which are proceedings for challenging patent claims. Those proceedings invalidated claims in six patents, and the Federal Circuit summarily affirmed. Plaintiffs later dismissed the seventh patent after the Patent Office invalidated certain claims during reexamination. On January 29, 2020, the court granted defendants’ motion for judgment on the pleadings concerning the final remaining patent, U.S. Patent No. 7,802,310, and entered judgment for defendants. Plaintiffs appealed that order.

After judgment, the parties stipulated to a schedule for briefing defendants’ attorneys’-fees motion. Defendants filed that motion on March 11, 2020, and plaintiffs’ opposition was due April 22, 2020. Plaintiffs instead moved to pause the fee proceedings until the appeal ended.

Analysis

The court explained that it had discretion to delay deciding attorneys’ fees while an appeal was pending, but that courts ordinarily consider fee motions promptly after the merits decision. It applied four factors: (1) whether plaintiffs showed a strong likelihood of success on appeal; (2) whether plaintiffs would suffer irreparable harm without a stay; (3) whether a stay would substantially injure other interested parties; and (4) where the public interest lay.

The first factor favored defendants. Plaintiffs had not made a strong showing that they were likely to succeed on appeal. Their main argument was that defendants’ fee motion might become moot if the Federal Circuit ruled in their favor, which the court found insufficient.

The second factor also favored defendants. Plaintiffs did not explain how proceeding with the fee motion would cause irreparable harm. They argued that they might waste time and money litigating a motion that could later become unnecessary, but they provided no evidence that this would cause irreparable harm.

The court found that the third factor supported plaintiffs, but gave it little weight. Defendants said a stay might jeopardize their ability to recover fees, although the court did not know plaintiffs’ financial condition. The court distinguished the earlier stay for patent review because that earlier proceeding had been considered likely to succeed, while plaintiffs had not made a comparable showing regarding their appeal.

The fourth factor favored defendants. The fee request covered all eight asserted patents, while the appeal concerned only one patent. The court concluded that judicial resources would be better served by deciding the fee issue promptly and allowing any appeal concerning the fee calculation to be considered along with the merits appeal. The court also noted the public interest in holding parties to their stipulations because it and defendants had relied on plaintiffs’ agreement to brief attorneys’ fees before the appeal.

Ruling

Judge Edward J. Davila denied plaintiffs’ motion to stay pending the Federal Circuit appeal. The court stated that three of the four factors favored denying the stay. This order decided only whether to pause the attorneys’-fees proceedings; it did not decide defendants’ fee motion or the outcome of plaintiffs’ appeal.