IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF DELAWARE

QUEST LICENSING CORP.,

Plaintiff,
V.

BLOOMBERG L.P., et al.,

Defendants.

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Civil Action No. 14-561 (GMS)

CONSOLIDATED

ORDER

WHEREAS, presently before the court is the Motion to Stay Pursuant to 18(b) of the
America Invents Act (D.I. 15) filed by Bloomberg L.P., Bloomberg Finance L.P., The Charles
Schwab Corporation, and Charles Schwab & Co., Inc., (respectively, "Bloomberg" and
"Schwab"); 1 and
WHEREAS, the court, having considered the instant motion, the response and replies
thereto, and the applicable law, concludes that the defendants have demonstrated that a stay in the
above captioned matter pending covered business method patent review is appropriate in this case. 2

Quest Licensing Corp. ("Quest") filed this action on April 29, 2014 against Bloomberg. (D.1. 1.) A related
action was filed against Schwab on June 11, 2014. (D.l. 16 at 6.) On October 9, 2014 this case was consolidated with
Civil Action Numbers 14-562 (GMS); 14-563 (GMS); 14-564 (GMS); and 14-727 (GMS). The remaining defendants
FactSet Research Systems Inc. ("FactSet"), SunGard Data Systems Inc. ("SunGard"), and Interactive Data
Corporation ("IDC") each filedjoinder motions in support of the Motion to Stay on October 10, 2014. (See D.l. 18,
19, and 20.) As all defendants have joined the instant motion the court will refer to the parties as "the defendants" for
purposes of this Order. The court also reviewed the defendants' submission of subsequent authority. (D.l. 29.)
2

On September 30, 2014 Bloomberg and Schwab filed a petition for covered business method review ("CBM
review") challenging the validity of every claim of U.S. Patent No. 7, 194,468 ("the '468 Patent"), the sole patent-insuit. (D.l. 16 at 6.) For clarity, the court addresses those defendants that did not join the CBM review petition as "the
nonmoving defendants." On the same day as the CBM review petition was filed, the court held a scheduling
conference in this action and the related consolidated cases. (D.1. 13.) The court set a trial date of June 20, 2016more than twenty months from the filing of the instant motion. (Id.) At the same conference, the court stayed
discovery until December 8, 2014, so that the instant motion could first be addressed by the court. (Id.) The court

also scheduled a status conference for December 5, 2014, in the event that the court needed to revisit the issue of
discovery while the motion was pending. (Id.) No discovery has occurred, the parties have not filed substantive
motions, and the court has not made any substantive rulings.
It is well established that the decision to stay an action lies within the sound discretion of the trial court. Cost
Bros. Inc. v. Travelers Indemnity Co., 760 F.2d 58, 60 (3d Cir. 1985); see also First Am. Title Ins. Co. v. Maclaren,
L.L.C., No. 10-363-GMS, 2012 WL 769601, at *4 (D. Del. Mar. 9, 2012). Central to the rationale providing for such
discretion is that of the "court's inherent power to conserve judicial resources by controlling its own docket." Cost
Bros. Inc., 760 F.2d at 60-61 (citation omitted).
Section 18 of the AIA provides for the establishment of transitional post-grant review proceedings to
reexamine the validity of covered business method patents. Leahy-Smith America Invents Act, Pub. L. No. 112-29,
18, 125 Stat. 284, 32931 (2011 ). The AIA also considers the effect of these proceedings on related patent
infringement actions and authorizes the district courts to stay such parallel litigation under certain circumstances.
Courts are directed to base their decision as to whether or not to grant such a stay on four factors: "(A) whether a stay,
or the denial thereof, will simplify the issues in question and streamline the trial; (B) whether discovery is complete
and whether a trial date has been set; (C) whether a stay, or the denial thereof, would unduly prejudice the nonmoving
party or present a clear tactical advantage for the moving party; and (D) whether a stay, or the denial thereof, will
reduce the burden oflitigation on the parties and on the court." AIA 18(b)(l). This statutory test closely resembles
the stay analysis courts have applied in assessing a motion to stay pending inter partes or ex parte reexamination by
the Patent and Trademark Office (the "PTO"). See Market-Alerts Pty. Ltd. v. Bloomberg Fin., L.P., 922 F. Supp. 2d
486, 489 (D. Del. 2013) (citations omitted).
As to the first factor, the court must consider "whether a stay, or the denial thereof, will simplify the issues
in question and streamline the trial." AIA 18(b)(l)(B). The defendants assert that a stay will simplify the issues for
trial for at least three reasons. (D.1. 16 at 14.) First, that the CBM review process will address and streamline claim
construction. (Id.) Second, that CBM review is very likely to result in cancellation of some or all of the '468 patent's
claims. (Id.) Third, the defendants assert that even if the claims are not amended, the CBM review will affect the
substantive meaning of the claims by prosecution history or otherwise. (Id.) Quest argues that because the Patent
Trial and Appeal Board's ("PTAB") "claim construction is not binding on this Court, and the claim construction
standards applicable before this Court and before the PT AB are fundamentally different" that CBM review would do
nothing to streamline the case. (D.I. 23 at 16.) The court does not dispute Quest's position regarding the various
claim construction standards. In spite of this fact, the court finds that simplification of the issues is still likely if the
underlying Petition is granted. Further, the differing standards do not limit the court's consideration of the PTAB's
determination and relevant intrinsic evidence. The court agrees with the defendants and finds that first factor weighs
in favor of a stay.
The second factor, which has the court consider how far the litigation has progressed, likewise favors a stay.
AIA 18(b)(l)(B). As discussed above, no discovery has occurred, the parties have not filed substantive motions,
and the court has not made any substantive rulings. Quest argues that the current lack of discovery is the result of
delay tactics perpetrated by the defendants. (D.I. 23 at 14-15.) The court finds that the conflicting evidence ofattempts
by the parties to start discovery prior to the court's Rule 26(f) conference does not constitute dilatory tactics.
Additionally, the court's decision to stay discovery for three months pending the resolution of this motion does not
overcome the fact that this litigation is at an early stage.
Under the third factor, the court must consider the potential of a stay to unduly prejudice the plaintiff or place
it at a clear tactical disadvantage. AIA 18(b)( 1)(C). Potential for delay does not, by itself, establish undue prejudice.
See Market-Alerts, 922 F. Supp. 2d at 494 (citations omitted). In assessing whether a plaintiff might be unacceptably
prejudiced by a stay, "the court turns to additional considerations including the timing of the stay request, the timing
of the administrative review request, the status of the review proceedings, and the relationship between the parties."
Id. (citations omitted). The defendants assert that a stay will not unduly prejudice Quest because the Petition and the
instant motion was filed at the litigation's outset. (D.1. 16 at 17.) Further, the defendants argue that there can be no
undue prejudice because Quest is a non-practicing entity that does not compete with the defendants and therefore
cannot obtain injunctive relief. (Id. at 18.) The defendants also point to a seven-year delay between issuance of the

IT IS HEREBY ORDERED THAT:

1.

Defendants' Motion to Stay (D.I. 15) is GRANTED; and

2.

This matter is STAYED pending resolution of the covered business method patent

review of U.S. Patent No. 7,194,468.

Dated: December _l_, 2014

'468 patent and Quest's filing suit against the defendants. (Id) In opposition, Quest argues that it's business-the
licensing of intellectual property-would be severely harmed by a stay. (D.1. 23 at 12.) Should the defendants
eventually be found to have infringed, Quest can be adequately compensated by money damages for any harm suffered
during the PTO proceedings. (D.I. 16 at 18.) Further, the CBM review process initiated by Congress is required by
law to conclude one year after initiation and only extendable by six months with a showing of good cause. 37 C.F.R.
42.301, 42.200(c). The court recognizes that Quest has an interest in the timely enforcement of its patent rights.
See Smith Int 'l, Inc. v. Hughes Tools Co., 718 F .2d 1573, 1581 (Fed. Cir. 1983) ("[P]ublic policy favors the protection
of the rights secured by ... valid patents."). Nonetheless, the court also recognizes the reduced time-frame allotted
by Congress for CBM review completion. Moreover, Bloomberg and Schwab's filing of the motion to stay
approximately six months after the filing of the first complaint is not considered by the court to be intentionally delayed
or dilatory. Since the parties and the court will have a definitive answer from the PTO whether it will grant CBM
review five months prior to the scheduled Markman hearing, the court finds this factor neutral. While a delay in
proceeding with its case may be somewhat prejudicial to Quest, it is not unduly prejudicial.
The fourth factor requires the court to consider "whether a stay, or the denial thereof, will reduce the burden
on litigation on the parties and on the court." AIA l 8(b)(1 )(D). Quest alleges that the defendants "have orchestrated
this CBM review and stay request to give them two chances to delay this case." (D.1. 23 at 13.) Because of the
consolidated nature of this case, Quest is concerned that the remaining defendants that did not join Bloomberg and
Schwab's CBM petition will be in a position to trigger separate CBM challenges at any time during the pendency of
this litigation or to re-litigate the claims determined by the PTO as a result of the CBM petition. (Id.) At this time,
the PTO has not yet granted the CBM review petition. The court recognizes that as the petitioners in CBM review,
Bloomberg and Schwab may not later assert that a claim is invalid on any ground raised in CBM review. While the
court recognizes the potential for delay as a result of separate CBM challenges, the court finds credible the nonmoving
defendants' assertions that they were uninformed of the Petition prior to the eve of filing by Schwab and Bloomberg
and in no way were attempting to "game" the system. (See D.l. 27 at 1-2; D.I. 25 at 11.) Additionally, the defendants
note, and the court agrees, that this is an unlikely proposition. (D.1. 25 at 7.) Further, 18(b) does not require the
court impose estoppel effect on the nonmoving defendants or consider the lack of stipulated estoppel effect in assessing
the four factors. Rather, the court is asked to balance the factors with a "thumb on the scale in favor of a stay being
granted." 157 Cong. Rec. Sl363-64 (daily ed. Mar. 8, 2011) (statement of Sen. Charles Schumer). Likewise
unsupported by the AIA is Quest's request that any stay granted by the court apply only to PTAB proceedings filed
by defendants on or before December 1, 2014. As such, the court declines to impose such conditions on defendants
FactSet, SunGard, and IDC at this time.
The court concludes that a stay will lessen the burden of litigation at issue. As such, and in light of the fact
that each of the defendants have joined the Motion to Stay, the court finds that the fourth factor favors a stay pending
CBM review. See Market-Alerts, 922 F. Supp. 2d at 496.
For the foregoing reasons, the court will grant the motion to stay pursuant to l 8(b) of the AIA. The balance
of the four statutory factors weighs in favor of granting a stay pending resolution of the CBM review proceedings.