Judge Furman Stays Case Involving Possible Direct Competitors Pending IPR

On August 8, 2018, Judge Jesse M. Furman (S.D.N.Y.) granted Defendant Synaptive Medical, Inc.’s (“Synaptive”) motion to stay proceedings pending inter partes review (“IPR”) of the patent-in-suit.  Plaintiff Karl Storz Endoscopy-America, Inc. (“KSEA”) sued Synaptive, alleging infringement of U.S. Patent No. 9,468,360 (“the ‘360 patent”).  Less than a month after filing its answer, Synaptive petitioned the Patent Trial and Appeal Board (“PTAB”) for IPR on the validity of the ‘360 patent.  The motion to stay was filed 19 days later.  The PTAB granted the Petition while the stay motion was pending.  Discovery, infringement and invalidity contentions, and claim construction have not yet begun in the case.

The Court granted the motion to stay after finding the following: (1) “it is indisputable now” that the IPR proceeding will simplify the issues; (2) the case is in its early stages; (3) a stay will not prejudice KSEA.  Regarding the prejudice factor, at least three of the four sub-factors weigh in favor of granting a stay. The fourth sub-factor – relationship of the parties – was “a closer call” because of the assertion of direct competitor relationship, but it was not enough to tip the balance of the prejudice factor in KSEA’s favor.

The case is Karl Storz Endoscopy-America, Inc. v. Synaptive Medical, Inc., No. 1:17-cv-05607-JMF (S.D.N.Y. Aug. 8, 2018).