United States District Court, E.D. Texas, Marshall Division
MEMORANDUM OPINION AND ORDER
GILSTRAP, UNITED STATES DISTRICT JUDGE
the Court is Defendants' Urgent Motion to Stay All
Deadlines Pending Appeal (Dkt. No. 185) (“the
Motion”). Having considered the same, and for the
reasons set forth herein, the Court finds that said Motion
should be and hereby is DENIED.
filed this case on August 31, 2016, alleging patent
infringement against FedEx Corporation (“FedEx
Corp.”), Federal Express Corporation (“FedEx
Express”), FedEx Ground Package System, Inc.
(“FedEx Ground”), FedEx Freight, Inc.
(“FedEx Freight”), FedEx Custom Critical, Inc.
(“FedEx Custom Critical”), FedEx Office and Print
Services, Inc. (“FedEx Office”), and GENCO
Distribution System, Inc. (“FedEx Supply Chain”)
(collectively, “FedEx” or
“Defendants”). (Dkt. No. 1.)
27, 2017, Defendants filed a Motion to Dismiss under 28
U.S.C. § 1406. (Dkt. No. 84.) The Court denied that
motion on November 22, 2017, primarily based on the fact that
the FedEx Defendants actively litigated this case, before and
after TC Heartland was decided, thus waiving their
right to object to venue. (Dkt. No. 161.) On December 5,
2017, Defendants filed a petition for a writ of mandamus from
the Federal Circuit seeking dismissal of several of the
Defendants in this case. (Dkt. No. 170.)
December 11, 2017, Defendants filed the instant Motion,
styled as “Urgent, ” to stay this case pending
the Federal Circuit's review of Defendants' mandamus
petition. (Dkt. No. 185.) Given the circumstances of this
case, the Court ordered expedited briefing on this Motion
(Dkt. No. 186), set a hearing for December 19, 2017 (Dkt. No.
187), and suspended certain deadlines in the case until such
December 19, 2017, the Court held a hearing on the instant
Motion and denied Defendants' request for a stay, with an
indication that a fuller written opinion would soon follow.
(Dkt. No. 197.)
courts possess an inherent power to manage their own docket,
including the power to stay proceedings. Clinton v.
Jones, 520 U.S. 681, 706 (1997); see also In re
Int'l Med. Prosthetics Research Assocs., Inc., 739
F.2d 618, 621 (Fed. Cir. 1984) (“Absent some
overwhelming legal requirement or showing of manifest
injustice, this court will not intervene in a district
court's management of its calendar or scheduling of
events in a matter before that court.”). However, stays
are not awarded as a matter of right. Nken v.
Holder, 556 U.S. 418, 427 (2009). Indeed, the Supreme
Court has recognized that stays are “an intrusion into
the ordinary processes of administration and judicial
review.” Id. (internal quotation marks
omitted). This is particularly true when a stay is sought in
the midst of an ongoing case being prepared for trial.
See, e.g., In re Franklin Sports Indus.,
Inc., 937 F.2d 622 (Fed. Cir. 1991) (unpublished)
(describing mandamus as an “extraordinary intrusion . .
. into the trial management process”).
Defendants point out in their briefing, courts traditionally
look to four factors in determining whether a stay is
appropriate when an order is subject to a pending appeal,
including: “(1) whether the stay applicant has made a
strong showing that he is likely to succeed on the merits;
(2) whether the applicant will be irreparably injured absent
a stay; (3) whether issuance of the stay will substantially
injure the other parties interested in the proceeding; and
(4) where the public interest lies.” Nken, 556
U.S. at 434.
Whether Defendants Have Shown a Strong Likelihood of
Success on the Merits
argue that where a losing party seeks a stay pending the
review of an order issued by the same court contemplating the
stay pending appeal, the “strong showing” of
success factor is relaxed. (Dkt. No. 196 at 6 (“[W]hen
a stay pending appeal is sought by a losing party on
an issue decided the other way by a district judge . . ., the
‘likelihood of success' prong when seeking a stay
pending appeal is slightly modified . . . .”).)
However, the cases upon which Defendants rely do not stand
for this proposition. Instead, the relaxed “substantial
case on the merits” standard applies where the
remaining factors “militate” in favor of a stay.
See Hilton v. Braunskill, 481 U.S. 770, 778 (1987).
This is the same approach the Federal Circuit took in
Standard Havens Products., Inc. v. Gencor Industries,
Inc., 897 F.2d 511 (Fed. Cir. 1990), upon which
Defendants rely, in observing that, with respect to the first
factor, a stay is appropriate “where [the] movant
establishes that it has a strong likelihood of success on
appeal, or where, failing that, it can nonetheless
demonstrate a substantial case on the merits,
provided the other factors militate in movant's
favor.” 897 F.2d at 513 (internal quotation marks and
brackets omitted). The other cases cited in Defendants'
papers applied a similar standard. See In re Deepwater
Horizon, 732 F.3d 326, 345 (5th Cir. 2013)
(“[W]here there is a serious legal question involved
and the balance of the equities heavily favors a stay . . .
the movant only needs to present a substantial case on the
merits.”); Washington Metro. Area Transit
Comm'n v. Holiday Tours, Inc., 559 F.2d 841, 843
(D.C. Cir. 1977) (“[A] court, when confronted with a
case in which the other three factors strongly favor interim
relief may exercise its discretion to grant a stay if the
movant has made a substantial case on the merits.”);
William Inglis & Sons Baking Co. v. ITT Cont'l
Baking Co., 526 F.2d 86, 88 (9th Cir. 1975) (“If
the harm that may occur to the plaintiff is sufficiently
serious, it is only necessary that there be a fair chance of
success on the merits.”); Sweeney v. Bond, 519
F.Supp. 124, 132 (E.D. Mo. 1981) (“The District of
Columbia, the Second and the Ninth Circuits have adopted the
approach that an injunction pending appeal is appropriate
where serious legal questions are presented and the balance
of hardships tips sharply toward the moving party.”),
aff'd, 669 F.2d 542 (8th Cir. 1982). These cases
do not suggest that the standard articulated in Nken
relaxes merely because the losing party is the one seeking a
stay. Indeed, such an exception to the “strong
showing” requirement would swallow the rule because the
losing party is generally the one seeking to stay an order
pending its appeal of that decision.
considered the Parties' arguments, the Court concludes
that Defendants have not made a “strong showing”
that they are likely to prevail on the merits of their
petition. As the Court explained in its original decision,
several of the Defendants in this case actually operate
numerous physical retail locations in this District from
which they are alleged to have infringed the Asserted
Patents. (Dkt. No. 161 at 13-17) Defendants made no effort to
dispute this in the instant Motion. Instead, Defendants
insist that their petition at least raises novel legal
questions and thus a stay is necessary. (Dkt. No. 185 at
7-8.) Even applying that standard, Defendants' arguments
fail. While there is uncertainty in patent venue law, the
Federal Circuit has addressed the proper standard for
interpreting § 1400(b), In re Cray Inc., 871
F.3d 1355 (Fed. Cir. 2017), and for applying non-rule waiver,
In re Micron Tech., Inc., 875 F.3d 1091 (Fed. Cir.
2017). In particular, Micron, the primary basis for
the Court's underlying decision on Defendants' Motion
to Dismiss, pointed to a long line of cases exploring the
contours of non-rule waiver. Micron, 875 F.3d at
1101 (collecting cases); see generally, e.g., Navico,
Inc. v. Garmin Int'l, Inc., No. 2:16-CV-00190, 2017
WL 2957882 (E.D. Tex. July 11, 2017); Infogation Corp. v.
HTC Corp., No. 16-CV-01902, 2017 WL 2869717 (S.D. Cal.
July 5, 2017); Amax, Inc. v. ACCO Brands ...