Neodron Ltd. v. Lenovo Group Ltd.

Background

Neodron alleged that Lenovo Group, Ltd., Lenovo, Inc., and Motorola Mobility, LLC infringed seven patents: U.S. Patent Nos. 8,102,286; 8,451,237; 8,502,547; 8,946,574; 9,086,770; 10,088,960; and 7,821,502. Neodron asserted only the ’547 patent against Motorola Mobility, LLC and all seven patents against Lenovo, Inc.

Defendants moved to stay the case pending inter partes review, a process in which the Patent and Trademark Office reviews the validity of patent claims. Four of the seven patents were involved in pending reviews at varying stages. The ’547 and ’960 patents had been granted review; a petition concerning the ’574 patent was pending; and a request for rehearing was pending concerning the ’502 patent. Review had been denied for the ’286 patent, and defendants had not petitioned for review of the ’237 and ’770 patents as of the order.

Analysis

The court considered three factors: the stage of the litigation, whether a stay would simplify the case, and whether it would unfairly harm Neodron.

For the first factor, the court found that the case was neither at a particularly early nor a particularly late stage. A claim-construction order had been issued, but discovery and trial deadlines had not been set. This factor therefore weighed neither for nor against a stay.

The court found that the second factor favored a stay. Defendants argued that as many as 28 of the 75 asserted claims could be eliminated through the reviews. The court also explained that even if the claims survived, defendants could be barred from raising before the district court certain arguments they had raised or reasonably could have raised during the reviews. Because four patents—more than half of the asserted patents—were involved in pending review proceedings, the court concluded that a stay could simplify the case.

The third factor also favored a stay. Neodron conceded that it was a non-practicing entity. Based on that concession, the court found that Neodron would not suffer irreparable harm from the delay and would not be unduly prejudiced by a stay.

Ruling

Judge Susan Illston granted defendants’ motion to stay the action pending inter partes review. The court stated that Neodron could move to lift the stay based on later developments in the review proceedings.

Because of the stay, the court denied defendants’ motion to amend their invalidity contentions as moot, without prejudice to refiling if and when the stay was lifted. The parties were ordered to file quarterly joint status reports about the review proceedings and relevant litigation in other jurisdictions. The first report was due October 1, 2020, and the September 4, 2020 case-management conference was vacated.