Intellectual Ventures v. HP stays in Waco

by Dennis Crouch

In re HP (Fed. Cir. 2022) (non-precedential)

The Federal Circuit has denied HP’s petition for mandamus in its attempt to escape Judge Albright’s W.D.Tex. courthouse.  Intellectual Ventures sued HP for patent infringement in 2021 for infringing its United States Patent No. 6,779,082.  The lawsuit focuses on HP’s SimpliVity data storage solution. The HP product was mostly developed by the SimpliVity Corp in Massachusetts.  HP bought SimpliVity in 2017 and moved further development to India.  Still, in the litigation HP argued that Massachusetts was clearly more convenient than Texas.

On mandamus, the Federal Circuit gave deference to Judge Albright’s refusal to transfer and concluded that HP had not proven its case.  In particular, HP “failed to identify any specific documents in Massachusetts.”  I’ll reiterate my prior thoughts that, for patent cases, courts should rethink the notion the storage facility location for electronic documents should not be much of a factor (if any) regarding convenience unless the location somehow places the documents outside of the legal reach of the US court system.

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The patent application was filed back in 2001 and was originally owned by ADC who sold that division to SS8.  In 2006, SS8 sold the patent to the “Imaginex Fund I”, an Intellectual Ventures shell.  In 2012, IV merged Imaginex back into an IV fund.  Claim 1 is written quite broadly to cover cloud computing:

1. A data storage system comprising:

a network;

a plurality of distributed data storage units coupled to the network … having a plurality of external inputs and outputs; and

an object management system (OMS) manager unit coupled to the plurality of distributed data storage units via the network,

the OMS manager unit and the plurality of distributed data storage unit implementing an object management system, wherein the object management system preferentially selects a first one of the plurality of distributed data storage units for file access in response to a file access request provided that the file access request is associated with an external input/output of the first distributed data storage unit;

wherein the object management system is configured such that, in response to a file retrieval request that is associated with a data file and an external output of the first distributed data storage unit, the object management system preferentially returns a hostname and pathname of a copy of the data file that is stored within the first distributed data storage unit.

HP filed for inter partes review (IPR) and the board granted the petition to institute.  HP’s motion to stay litigation pending IPR is now pending before Judge Albright. The brief makes three key points:

1. If HP wins the IPR, it will end the lawsuit or at least greatly simplify the case.
2. The patent is expired — that means that the only potential prejudice is delay in obtaining damages.  This will not unduly prejudice IV.
3. The lawsuit is at an early stage.

This is one that appears a good candidate for stay, although would push-back the trial scheduled for March 2023.