28
Jun
By Eric Schweibenz
On June 23, 2010, ALJ Theodore R. Essex issued Order No. 11 (dated April 27, 2010) in Certain Authentication Systems, Including Software and Handheld Electronic Devices (Inv. No. 337-TA-697).  In the Order, ALJ Essex denied Complainant Prism Technologies, LLC (“Prism”) motion to stay the investigation for 45 days pending action by the U.S. Patent & Trademark Office (“PTO”) in an ex parte reexamination proceeding involving the patent-at-issue, U.S. Patent No. 7,290,288 (the ‘288 patent).

According to the Order, the present issue arose as a result of Respondents Research in Motion Limited and Research in Motion Corporation’s (collectively, “RIM”) pending Motion for Summary Determination of Invalidity (“RIM’s MSD”).  In particular, RIM’s MSD argued that the ‘638 application which became the ‘288 patent did not claim priority to the ‘710 application and, as a result the ‘288 patent was invalid under the on-sale bar of 35 U.S.C. § 102(b).  RIM further argued that the ‘638 application was filed on August 29, 2002, and did not contain language that it was a continuation-in-part of the ‘710 application, which issued as U.S. Patent No. 6,516,416.  According to the Order, Prism had made and marketed Internet Subscription Access products since as early as 1996 and admitted that such products practice the asserted claims of the ‘288 patent.  The ‘710 application was filed on June 11, 1997, and had the ‘288 patent been a continuation of the ‘710 application, the on-sale bar might be defeated.  Prism filed an amendment in a reexamination proceeding involving the ‘288 patent that would claim priority based on the ‘710 application.  Prism filed this amendment on April 2, 2010 and moved for a stay of 45 days to await the results of PTO reexamination.  RIM opposed Prism’s motion to stay.  The Commission Investigative Staff also opposed the stay, but supported Prism’s request in the alternative to defer a ruling on RIM’s MSD.

In deciding to deny Prism’s motion, ALJ Essex considered the following five factors: (1) the state of discovery and the hearing date, (2) whether a stay will simplify the issues and hearing of the case, (3) the undue prejudice or clear tactical disadvantage to any party, (4) the stage of the parallel proceedings, and (5) the efficient use of Commission resources.

Regarding the state of discovery and the hearing date, ALJ Essex determined that this factor weighed against a stay pending resolution of the PTO reexamination proceedings.  In particular, ALJ Essex determined that “[w]hile it is possible that the outcome of the action before the PTO may impact the ALJ’s ruling on RIM’s MSD, it is clear that no issue of discovery will be determined or resolved based on the PTO’s determination.”

With respect to whether a stay will simplify the issues and hearing of the case, ALJ Essex determined that while the action of the PTO could resolve the validity of the ‘288 patent, a stay would not simplify any of the other issues in the investigation.  Thus, ALJ Essex found that Prism had not demonstrated that a stay would simplify any issues in this investigation.

Regarding the undue prejudice or clear tactical disadvantage to any party, ALJ Essex determined that this factor weighed against a stay pending the reexamination process.  In particular, ALJ Essex held that “Prism should have ‘had all of its ducks in a row’ before filing the complaint and granting a stay to allow Prism to do so would be unfair to the other parties in the investigation.”

As to the stage of the parallel proceedings, ALJ Essex determined that this factor was at best neutral since it was not clear that the subject amendment would be allowed in 45 days.

With respect to the efficient use of Commission resources, ALJ Essex found that this factor also weighed against granting a stay.  Specifically, ALJ Essex determined that if the reexamination is resolved in Prism’s favor, the ALJ would still need to hear all of the issues regarding the asserted claims of the ‘288 patent, including validity.  At best, the reexamination would only impact the issues raised in connection with RIM’s MSD.

In view of the above, ALJ Essex denied Prism’s motion.  Regarding Prism’s alternative request that the ALJ defer ruling on RIM’s MSD for 45 days, ALJ Essex held that he “will not hold this investigation captive waiting for the prospective ruling on a reexamination of the ‘288 patent by the PTO.”
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