Declaratory Judgment Case Against CRS LLC Dismissed on First to File Rule
In a case for declaratory judgment styled TGN, Inc. v. CRS LLC (08-680MJP), plaintiff TGN sought an order invalidating US Pat. 6,073,124 and declaring that certain software does not infringe. TGN is wholly owned by Turner Broadcasting System (TBS). Among others, TGN and TBS own and operate a website, GameTap.com, which is alleged to infringe the '124 patent. Allegations of infringement were made in a complaint filed last March in the District of Delaware, (08-127GMS) by CRS LLC. TGN filed its DJ action about two months later and CRS moved to dismiss based on the first to file rule. CRS states in its motion to dismiss that Time Warner is the nation's 49th largest corporation with over $46 Billion in reported revenue and over $130 Billion in assets but that very little is known about plaintiff TGN. In her order dismissing the case the Judge Pechman explained as follows:
TGN has presented no evidence that CRS has acted in bad faith. See Alltrade, 946 F.2d at 628 (citing Mission Ins. Co. v. Puritan Fashions Corp., 706 F.2d 599, 602-03 (5th Cir. 1983) (plaintiff acted in bad faith when plaintiff asked defendant to hold the suit, then ran to court and sued defendant)). Neither is there evidence that CRS filed suit in Delaware in anticipation of TGN’s declaratory action in this Court. See Guthy-Renker Fitness, L.L.C. v. Icon Health & Fitness, Inc., 179 F.R.D. 264, 271 (C.D. Cal. 1998) (providing that a suit is anticipatory “if the plaintiff in the first-filed action filed suit on receipt of specific, concrete indications that a suit by the defendant was imminent”). CRS does not appear to be forum shopping. Alltrade, Inc. v. Uniweld Products, Inc., 946 F.2d 622, 629 (9th Cir. 1991) (citing Mission, 706 F.2d at 602 n.3 (“[a]nticipatory suits are disfavored because they are an aspect of forum shopping”)).
Faithful readers of this blog will recognize CRS and the '124 patent from other posts. Here is a list of the cases CRS has filed in this district since 2004:
In the case against Valve, Judge Jones recently denied Valve's motion seeking bifurcation on liability and Damages. From Judge Jones' order:
Valve has offered no evidence to distinguish this action from any other civil case. First, Valve’s argument that it will succeed in avoiding liability is premised entirely on its observation that CRS and its predecessors in ownership of the patent-in-suit have failed in litigations against other defendants. Valve offers few details about these other litigations, and no basis for the court to conclude, at this stage, that a similar outcome is likely in this litigation. Second, while Valve seeks phased discovery, it does not seek to phase dispositive motions or bifurcate trial. Under those circumstances, there is no reason to expect that the court will receive a dispositive motion and rule on it before the damages phase of discovery would begin. Third, although Valve repeatedly decries the “time-consuming, burdensome, and expensive” nature of damages discovery (Mot. at 7), it offers no evidence that responding to CRS’s damages-related discovery requests will be particularly time-consuming, burdensome, or expensive. Discovery is inherently burdensome and time-consuming, and always comes at some cost to the parties; but the question for the court is whether the burden of the discovery is unreasonable. Without evidence that damages discovery will impose burdens that justify a departure from the ordinary rule that damages and liability discovery proceed simultaneously, there is no basis to grant Valve’s request.
The case against Bitarts Ltd. was stayed in view of the defendants' bankruptcy filing in may 2006, and it involved another patent, US 6,141,698.
The case against IGN relating to the '124 patent ended in a confidential settlement earlier this year as I reported here.
CRS is represented by local patent lawyer/litigator Bob Rhode.
TGN has presented no evidence that CRS has acted in bad faith. See Alltrade, 946 F.2d at 628 (citing Mission Ins. Co. v. Puritan Fashions Corp., 706 F.2d 599, 602-03 (5th Cir. 1983) (plaintiff acted in bad faith when plaintiff asked defendant to hold the suit, then ran to court and sued defendant)). Neither is there evidence that CRS filed suit in Delaware in anticipation of TGN’s declaratory action in this Court. See Guthy-Renker Fitness, L.L.C. v. Icon Health & Fitness, Inc., 179 F.R.D. 264, 271 (C.D. Cal. 1998) (providing that a suit is anticipatory “if the plaintiff in the first-filed action filed suit on receipt of specific, concrete indications that a suit by the defendant was imminent”). CRS does not appear to be forum shopping. Alltrade, Inc. v. Uniweld Products, Inc., 946 F.2d 622, 629 (9th Cir. 1991) (citing Mission, 706 F.2d at 602 n.3 (“[a]nticipatory suits are disfavored because they are an aspect of forum shopping”)).
Faithful readers of this blog will recognize CRS and the '124 patent from other posts. Here is a list of the cases CRS has filed in this district since 2004:
| March 2008 | ||||
| CRS LLC v. Valve Corp | WA Western | Donohue | Patent | Federal Question |
| Plaintiff: CRS LLC; Defendant: Valve Corp | ||||
| June 7, 2007 | ||||
| CRS LLC v. IGN Entertainment Inc | WA Western | Zilly | Patent | Patent Infringement |
| Plaintiff: CRS LLC; Defendant: IGN Entertainment Inc | ||||
| March 17, 2005 | ||||
| CRS, LLC v. Bitarts, LTD | WA Western | Lasnik | Patent | Patent Infringement |
In the case against Valve, Judge Jones recently denied Valve's motion seeking bifurcation on liability and Damages. From Judge Jones' order:
Valve has offered no evidence to distinguish this action from any other civil case. First, Valve’s argument that it will succeed in avoiding liability is premised entirely on its observation that CRS and its predecessors in ownership of the patent-in-suit have failed in litigations against other defendants. Valve offers few details about these other litigations, and no basis for the court to conclude, at this stage, that a similar outcome is likely in this litigation. Second, while Valve seeks phased discovery, it does not seek to phase dispositive motions or bifurcate trial. Under those circumstances, there is no reason to expect that the court will receive a dispositive motion and rule on it before the damages phase of discovery would begin. Third, although Valve repeatedly decries the “time-consuming, burdensome, and expensive” nature of damages discovery (Mot. at 7), it offers no evidence that responding to CRS’s damages-related discovery requests will be particularly time-consuming, burdensome, or expensive. Discovery is inherently burdensome and time-consuming, and always comes at some cost to the parties; but the question for the court is whether the burden of the discovery is unreasonable. Without evidence that damages discovery will impose burdens that justify a departure from the ordinary rule that damages and liability discovery proceed simultaneously, there is no basis to grant Valve’s request.
The case against Bitarts Ltd. was stayed in view of the defendants' bankruptcy filing in may 2006, and it involved another patent, US 6,141,698.
The case against IGN relating to the '124 patent ended in a confidential settlement earlier this year as I reported here.
CRS is represented by local patent lawyer/litigator Bob Rhode.
Labels: 6073124, CRS LLC, Gametap, seattle patent litigation, TBS, TGN, Time Warner, Turner Broadcasting System
posted by Mark P. Walters @ 8:32 AM
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