In an order issued on September 28, 2020, the Federal Circuit denied Sand Revolution's petition for writ of mandamus. In re Sand Revolution LLC, No. 2020-145, 2020 WL 5757591, at *1 (Fed. Cir. Sept. 28, 2020). In its petition, Sand Revolution urged the Federal Circuit to direct the District Court for the Western District of Texas to vacate its order denying a litigation stay and enter an order staying the litigation pending resolution of a related IPR. Pet. for Writ of Mandamus at 5.
The proceedings underlying the mandamus petition began in August 2018 when Continental Intermodal Group brought a patent infringement action against Sand Revolution. Sand Revolution, 2020 WL 5757591, at *1. Almost a year later, Sand Revolution filed a petition for IPR of the asserted claims. Resp. to Pet. for Writ of Mandamus 5. Although the PTAB initially denied institution, upon rehearing, it agreed to institute review. Sand Revolution, 2020 WL 5757591, at *1. Thereafter, Sand Revolution moved to stay the litigation, which the district court denied. Id.
In its petition to the Federal Circuit, Sand Revolution argued that the district court abused its discretion by failing to meaningfully consider the traditional stay factors. Pet. 12-16. Supporting this argument, Sand Revolution highlighted the short time in which the district court issued its order—only five hours after Sand Revolution filed the motion—and the brevity of the order. Id. at 4, 13. In addition, Sand Revolution alleged that the district court's reasons for denial (i.e., the court's “strong belie[f]” in the Seventh Amendment, the fact that the case had been pending since 2017, the observation that “[d]enying the stay would allow the Parties to obtain a more timely and complete resolution of infringement, invalidity, and damages issues,” and because Plaintiff opposed the stay) were incompatible with the intent of the AIA to provide an alternative to litigation. Id. at 16. And lastly, Sand Revolution argued that it had no other means to obtain the requested relief. Id. at 28.
Continental Intermodal Group advanced two main arguments to oppose the petition. First, it argued that Sand Revolution could not show it had a clear and indisputable right to stay the litigation, asserting that mandamus is almost never appropriate to overturn a court's discretionary decision, including the decision whether to grant a stay pending resolution of an IPR. Resp to Pet. 12-13. Second, Continental Intermodal Group alleged that the district court's exercise of discretion in denying the stay was reasonable because each factor weighed against a stay. Id. at 19-22.
In its order denying mandamus, the Federal Circuit reasoned that Sand Revolution did not meet the exacting standard for obtaining relief by way of mandamus. Sand Revolution, 2020 WL 5757591, at *1. Specifically, the Federal Circuit stated that it could not determine that the district court clearly overstepped its authority, that Sand Revolution showed a clear and indisputable right to a stay, or that Sand Revolution would be irreparably harmed by having to face the burden and expense of district court litigation. Id. Notably, however, the Federal Circuit seemed to admonish the district court's stay denial stating “[t]he district court's ruling was cursory and this court could have benefited from further elaboration based on the traditional stay factors.” Id.
Although the Federal Circuit's order is relatively short, it provides messages for both district courts and for litigants facing similar situations. For litigants, the burden for obtaining relief related to a litigation stay by way of mandamus is very high. For district courts, when granting or denying a stay, courts should provide a discussion of the traditional factors.
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