Implicit Networks Case Stayed Pending Reexamination

Local patent licensing company, Implicit Networks, was dealt a blow recently in its bid to enforce patent rights against Intel, AMD, Real Networks, and Sun. Implicit Sued back in February 2008 on U.S. Patent No. 6,629,163, a patent covering various encryption methods using demultiplexing technology for data processing. Implicit Networks alleges Intel uses this patented technology in its Viiv-based products, AMD and Raza allegedly use it in ATI and Alechemy products, Nvidia in its Stant Media software, Sun in its Java Media Framework, and Real in its Helix DNA client.

The party defendants filed a request for ex-parte reexam in December 2008, nearly 10 months after the complaint was filed. Shortly thereafter, they moved to stay the case. On Monday, Judge Robart granted the motion, relying in large part Implicit's delay in prosecuting the case, its grant of multiple extensions of time, its failure to conduct early discovery, its failure to seek even a single deposition after almost a year of pendency of the lawsuit. Further, its status as a "patent licensing company" weighed heavily against its claims of prejudice in view of the requested stay.

This result underscores the need for patent plaintiffs to have a clear plan for enforcement going into litigation and to diligently execute that plan from the first day the complaint is filed. The result here might have been different had Implicit proceeded diligently with discovery. After all, it had ten months before the party defendants even sought reexamination. A lot could have been accomplished in the last 12 months since the case was filed in order to buttress arguments that delay in view of reexamination will cause prejudice.

From Judge Robart's order:

"Finally, Implicit argues that “stays continue to prejudice the non-movant even after the stay has been lifted, particularly in the aspects of litigation that require expediency.” (Resp. at 6.) Here, Implicit has not moved with great expediency. Twelve months have passed since the initial filing, yet only recently has Implicit served interrogatories and requests for production. (See Knox Decl. ¶ 2.) This lack of urgency weighs in favor of granting a stay."

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