Virtualagility Inc. v. salesforce.com, Inc.
759 F.3d 1307
| Fed. Cir. | 2014Background
- VA sued Defendants in Jan 2013 for infringement of US 8,095,413; Salesforce filed CBM petition May 2013 alleging covered business method patent and standing under AIA §18(a)(1)(B); PTAB granted-in-part CBM review Nov 2013; district court denied stay Jan 2014; appeal under AIA §18(b)(2) and four-factor test; panel held stay should be granted and district court erred in denying
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standard of review for stay order under AIA §18(b) | Defendants seek de novo review | VA argues deference due to docket management | De novo review not required; court reverses on merits regardless of standard |
| Whether CBM review would simplify issues | CBM would cancel all claims reducing trial complexity | PTAB may cancel none or some claims; amendments may alter litigation | First and Fourth factors favor stay; PTAB review could dispose of all claims |
| Whether discovery burden would be reduced | Stay reduces discovery and court burden | Discovery and trial would still occur; can be managed | Factor weighs in favor of stay |
| Whether undue prejudice to VA favors denial of stay | VA would suffer market and litigation delay | Delay not irreparable; monetary damages available | Undue prejudice not established; stay favored |
| Timing stage of litigation in applying factor analysis | Early stage weighs against stay | Post-Grant review instituted and imminent trial supports stay | Timing supports granting stay |
Key Cases Cited
- Landis v. North American Co., 299 U.S. 248 (1936) (establishes discretionary stay authority; balance of factors)
- Procter & Gamble Co. v. Kraft Foods Global, Inc., 549 F.3d 842 (Fed.Cir. 2008) (abuse-of-discretion review framework for stay decisions)
- Gould v. Control Laser Corp., 705 F.2d 1340 (Fed.Cir. 1983) (traditional stay review framework)
- Boston Scientific Corp. v. Cordis Corp., 777 F.Supp.2d 783 (D.Del. 2011) (timing and stage of litigation affect stay)
- Market-Alerts Pty. Ltd. v. Bloomberg Fin. L.P., 922 F.Supp.2d 486 (D.Del. 2013) (competition and prejudice considerations in stay)
- Universal Elecs., Inc. v. Universal Remote Control, Inc., 943 F.Supp.2d 1028 (C.D.Cal. 2013) (undue prejudice and stay considerations)
- Highmark Inc. v. Allcare Health Mgmt. Sys., Inc., 134 S. Ct. 1744 (2014) (abuse of discretion and need for district court flexibility)