No Stay Pending IPR in Brewing Patent Dispute
District court patent defendants often request a parallel inter partes review (“IPR”) proceeding at the U.S. Patent Office to challenge the validity of the patent at issue. As such IPR proceedings have the potential to kill the patent, district courts have more often than not stayed their proceedings while they wait on the outcome of the parallel IPR proceeding at the Patent Office. That was not the case, however, in a dispute in the District of Massachusetts between two competitors in the coffee brewing systems industry. In a case involving Keurig Green Mountain and Touch Coffee & Beverages, Judge Denise Casper denied a request for stay pending resolution of a parallel IPR.
Keurig initiated the case, filing an action asserting infringement of one of its own patents by Touch’s brewing systems, as well as seeking a declaratory judgment that Keurig’s brewing systems did not infringe four patents owned by Touch. Touch responded with a pleading accusing Keurig of infringing those same four patents and seeking a declaratory judgment that Keurig’s patent was invalid and not infringed. At the same time, Touch moved for a preliminary injunction to enjoin what it asserted were Keurig’s sales of infringing goods. After permitting initial discovery from both parties relating to the preliminary injunction motion, the court denied Touch’s motion.
In July 2016, Keurig filed IPR petitions on Touch’s four asserted patents. Approximately four months later, Touch moved to stay the proceedings. In their briefs for and against the stay, both parties framed their arguments around the three factors relevant to a motion to stay pending an IPR: (1) whether the stage of the litigation favors a stay, (2) whether and the extent to which a stay would simplify the issues in question and trial of the case, and (3) whether a stay would unduly prejudice or provide a clear tactical disadvantage to the nonmoving party.
With regard to the stage of the litigation, Touch argued that the case was still in its early stages, focusing its argument on the fact that claim construction had not yet occurred. Keurig explained that, because of the motion for preliminary injunction filed by Touch, the case had proceeded substantially further than Touch had represented. In particular, the parties had already briefed numerous issues in the case, conducted discovery involving thousands of pages of documents, as well as having exchanged expert reports and deposed experts.
On the second element, Keurig argued that a stay would not simplify the issues. For its part, Touch explained that PTAB decisions on issues like claim construction or ultimate conclusions of validity would simplify the issues with respect to the four patents that it asserted. However, Keurig responded by arguing that the patent that it asserted against Touch’s brewing systems was not subject to an IPR petition, and any decision by the Patent Office to institute IPR proceedings would in no way simplify issues as they related to Keurig’s asserted patent. Moreover, the PTAB had not yet decided whether to institute Keurig’s IPR petitions relating to Touch’s asserted patents.
Finally, Keurig argued that it would be unduly prejudiced by a stay by virtue of it and Touch being direct competitors in the market for the sale of brewers, citing cases from a number of jurisdictions highlighting the harm that arises from a stay in a case between competitors. In addition, Keurig pointed out what it perceived as Touch’s inconsistent positions in the litigation: first asking for expediency with a motion for preliminary injunction and later requesting a stay. Touch asserted that any potential prejudice toward Keurig would be outweighed by the potential narrowing of the issues in the case.
The court was not persuaded by Touch’s arguments as it denied the motion to stay in an electronic docket order, without opinion. The case is Keurig Green Mountain, Inc. v. Touch Coffee & Beverages, LLC, No. 1:16-cv-10142-DJC, pending in the District of Massachusetts.