Opinion
Case Number C 04-03659 JF, [Docket Nos. 4, 6, 7, 12, and 15].
November 15, 2004
ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTIONS TO STAY AND/OR SEVER
The Court has determined that the instant motions are appropriate for determination without oral argument. See Civil L.R. 7-1(b). Accordingly, the hearing date of November 19, 2004, is hereby vacated.
Plaintiff Verve, LLC ("Verve") alleges patent infringement by Defendants Verifone, Inc. ("Verifone"), CyberNet, Inc. ("CyberNet"), Hypercom Corporation ("Hypercom"), Ingenico Corporation ("Ingenico"), Lipman USA, Inc. ("Lipman"), Thales e-Transactions, Inc. ("Thales"), and Trintech, Inc. ("Trintech") (collectively "Defendants"). Defendants allegedly have infringed and continue to infringe U.S. Patent No. 5,012,077 ("the '077 patent"), which is owned by Verve. CyberNet, Ingenico, Lipman, Thales, and Trintech (collectively "the Moving Defendants") move to stay the proceedings pending a final determination by the United States International Trade Commission ("ITC") in an ongoing investigation regarding the '077 patent. In addition, CyberNet, Ingenico, Lipman, and Thales each moves that the action against it be severed. Verve does not oppose the motions to stay the proceedings so long as the proceedings are stayed with respect to all Defendants. The Court has read the moving and responding papers. For the reasons set forth below, the motions to stay the proceedings will be granted, and the motions to sever will be denied without prejudice.
The motions for severance by CyberNet and Ingenico are made in the alternative in the event that any other Defendants do not wish to stay the proceedings. The motions for severance by Lipman and Thales are brought on the grounds that joinder is not appropriate.
Neither Verifone nor Hypercom ("the Non-Moving Defendants") has moved to stay the proceedings as of the date of this Order.
At the request of a party to a civil action that is also a respondent in a proceeding before the ITC under section 337 of the Tariff Act of 1930, a district court "shall stay, until the determination of the [ITC] becomes final, proceedings in the civil action with respect to any claim that involves the same issues involved in the proceeding before the [ITC]," so long as the request is made within thirty days after the party is named as a respondent in the proceeding before the ITC or thirty days after the action is filed in the district court, whichever is later. 28 U.S.C. § 1659(a). Moreover, district courts have inherent authority to stay proceedings before them. Rohan ex rel. Gates v. Woodford, 334 F.3d 803, 817 (9th Cir. 2003). The power to stay proceedings is incidental to the power inherent in every court to control the disposition of the causes on its docket with economy of time and effort for itself, for counsel, and for litigants. Landis v. N. Am. Co., 299 U.S. 248, 254 (1936).
The Moving Defendants have demonstrated that all of the requirements for a stay pursuant to 28 U.S.C. § 1659(a) are satisfied. First, the Moving Defendants are both parties to the instant civil action and respondents in ITC Investigation Number 337-TA-524, entitled In the Matter of Certain Point of Sale Terminals and Components Thereof, which is being conducted pursuant to section 337 of the Tariff Act of 1930. Second, both the civil action and the ITC investigation involve allegations of infringement of the '077 patent. Third, the requests to stay the proceedings in this Court were timely filed. Verve's complaint was filed in this Court on August 30, 2004, and the ITC issued notice of the initiation of its investigation on August 31, 2004, which notice was published in the Federal Register on September 3, 2004. All of the instant motions were filed on either September 29, 2004, or September 30, 2004, and thus within thirty days after the Moving Defendants' being named as respondents in the ITC's investigation. Accordingly, the motions to stay the proceedings in this Court with respect to the Moving Defendants are GRANTED. The Court further exercises its inherent authority to stay proceedings to stay this civil action with respect to the Non-Moving Defendants, as they, too, are respondents in the ITC investigation, and it is in the interest of judicial economy that the Court stay this entire case pending the ITC's final determination.
The Non-Moving Defendants also are named as respondents in the ITC investigation.
Having stayed the proceedings in their entirety, the Court need not consider the motions to sever at this time. The parties have suggested that the ITC proceedings likely will result in a final determination within the next year and that such determination may resolve their dispute and obviate the need for the civil action before this Court. Accordingly, the motions for severance are DENIED without prejudice.
IT IS SO ORDERED.