Skillz Platform Inc. v. AviaGames Inc.

Background

Skillz alleged that AviaGames infringed U.S. Patent No. 9,649,564, which concerns mobile gaming. The patent was the only remaining patent asserted in the case. AviaGames had filed a petition with the Patent Trial and Appeal Board (PTAB) seeking inter partes review, a process in which the PTAB examines whether patent claims are valid. The petition challenged all claims Skillz asserted in the case. The PTAB had not yet decided whether to begin that review.

AviaGames moved to pause the federal case while the PTAB considered the petition. Alternatively, it asked the court to postpone the scheduled claim-construction hearing until after the PTAB decided whether to begin review. Claim construction is the court’s process for interpreting the meaning of patent terms used in the claims.

Analysis

The court considered three factors used to decide whether to pause a patent case for a parallel PTAB proceeding: the stage of the case, whether the PTAB proceeding might simplify the issues, and whether a pause would unfairly harm or disadvantage Skillz.

The court found that the stage of the case somewhat favored a pause. Although significant discovery had occurred, expert discovery remained, and the trial was not scheduled until late 2023. The court also noted that claim-construction briefing was complete and the hearing was near.

The court found that the potential for simplification weighed against a pause. Because the PTAB had not yet decided whether to institute review, any benefit from the review was speculative. If the PTAB declined to institute review, pausing the federal case would only delay it and could compress the remaining litigation schedule.

The court found that the prejudice factor slightly weighed against a pause. Two subfactors—the timing of AviaGames’s petition and the timing of its stay motion—favored AviaGames. The other two—the status of the PTAB proceeding and the parties’ direct competition—weighed against a pause. The court concluded that Skillz had provided sufficient evidence that the companies’ competition could cause harm that might not be fully addressed by money damages, even though Skillz had not sought a preliminary injunction.

Ruling

Judge Beth Labson Freeman concluded that AviaGames had not met its burden to show that a stay was appropriate. The court denied AviaGames’s motion to stay without prejudice to filing a renewed motion if the PTAB institutes inter partes review of the patent. The court separately denied AviaGames’s request to continue the claim-construction hearing, finding that the required good cause was too speculative before the PTAB decided whether to begin review.