Largan Precision Co, LTD v. Motorola Mobility, LLC.

Background

Largan sued Motorola for infringement of six United States patents: the ’767, ’499, ’519, ’948, ’487, and ’397 patents. Motorola filed six petitions for inter partes review, a process in which the Patent Trial and Appeal Board reviews patent claims, challenging 74 claims from five of the six patents. Motorola stipulated that, if review was instituted, it would not pursue in the district-court case any ground raised or reasonably available in the reviews.

The district-court case was still in an early stage. The parties had exchanged infringement and invalidity contentions, served initial discovery requests, and produced some documents, but had not completed written discovery or document production, taken depositions, begun claim-construction briefing, or set a trial date.

Motion to Stay

The court considered three factors: the stage of the litigation, whether a stay would unfairly prejudice or tactically disadvantage Largan, and whether the patent reviews would simplify the issues and reduce the burden of the case.

The court found that the reviews could be case-dispositive as to five of the six asserted patents or, at minimum, clarify and reduce the issues. The court rejected Largan’s argument that a stay was premature because the Board had not yet decided whether to institute review. It also found that Largan’s arguments concerning whether Motorola properly identified Sunny Optical and Lenovo as real parties in interest were matters that could be presented to the Board, not reasons to deny a stay at that stage.

The court also rejected Largan’s argument that a stay would cause it to lose market share. The court noted Largan’s admission that it did not compete directly with Motorola and found that Largan had provided no concrete evidence of likely market-share loss. The court further stated that Largan’s willingness to license its patents weakened its claim of unfair prejudice because monetary damages could later compensate it.

Because discovery and claim construction were incomplete and no trial date had been set, the court found that the early stage of the litigation favored a stay. The court concluded that all three factors supported pausing the case.

Alternative Requests and Sur-Reply

Largan alternatively asked the court to delay ruling on the stay until it obtained discovery about whether Sunny Optical was a real party in interest. Largan also asked the court to exclude discovery concerning Motorola’s relationships with suppliers from the stay so it could determine the full scope of the alleged infringement. The court denied these requests, finding that the real-party-in-interest issue was better addressed by the Board and that Largan had not shown a sufficient basis for discovery about non-accused products. The court also found Largan’s concerns that evidence might be lost or destroyed during the stay speculative and unsupported.

Largan separately asked for permission to file a sur-reply after Motorola’s stay motion had been fully briefed. The court denied leave because the local rules did not permit the filing and Largan had not shown good cause. The court added that the proposed sur-reply would not have changed its decision.

Disposition

The court granted Motorola’s motion to stay and denied Largan’s motion for leave to file a sur-reply. It vacated the August 19, 2022 hearing and ordered the parties to file a joint status report by January 23, 2023, concerning the patent-review petitions. The court stated that the ruling did not preclude Largan from filing a later motion to lift the stay.