United States District Court, D. Montana, Missoula Division
W. Molloy, District Judge.
issue is Defendant Better Than Logs, Inc.'s ("Better
Than Logs") request for a stay pending reexamination of
Plaintiff Concrete Log Systems Inc. d/b/a/ Everlog
Systems' ("Everlog") patent for a cement-based,
simulated log siding ('"598 Patent") pending
reexamination by the United States Patent and Trademark
Office ("Patent Office"). (Doc. 9.) The motion is
is a Montana corporation with its principal place of business
in Missoula, Montana. (Compl. Doc. 1 at ¶ 2.) It is the
owner of the '598 Patent, entitled "Simulated Log
Siding," which issued July 4, 2017. (Id. at
¶ 7.) The '598 Patent covers a cementitious siding
product designed to appear as wooden log siding.
(Id. at ¶ 9.) Everlog sells products practicing
the '598 Patent under the names "Everlogs,"
"Everlog Systems," "Everlog Siding," and
"Everlog Timbers." (Id., at ¶ 10.)
Than Logs is a Montana corporation with its principal place
of business in Drummond, Montana. (Ans. Doc. 7 at ¶ 2.)
Everlog asserts that Better Than Logs manufactures and sells
a number of products which infringe on the '598 Patent,
(Doc. 1 at ¶ 13), which Better Than Logs Disputes, (Doc.
7 at ¶ 13). Generally speaking, those products are
elongated, concrete "logs" patterned to look like
wood. (Doc. 1 at ¶ 14.) Everlog argues the products
compete directly with its engineered siding products.
(Id. at ¶ 13.) Everlog has not licensed or
authorized Better Than Logs to manufacture, sell, or import
any products covered by the '598 Patent. (Id.
seeks injunctive and monetary relief against Better Than Logs
for false advertising and deceptive trade practices pursuant
to the Lanham Act and Montana common law. (Doc. 1 at ¶
1.) Count One alleges patent infringement in violation of 35
U.S.C. § 271. (Id. at ¶¶ 16-23.)
Count Two alleges false designation of origin and unfair
competition, in violation of 15 U.S.C. § 1125(a)(1)(A).
(Id. at ¶¶ 24-59.) Count Three alleges
false advertising, in violation of 15 U.S.C. §
1125(a)(1)(B). (Id. at ¶¶ 60-63.) Count
Four alleges unfair competition, in violation of Montana
common law. (Id. at ¶¶ 64-68.) Boiled
down, Everlog alleges Better Than Logs has infringed on its
patent and falsely advertised that its products are
"Made in U.S.A." and "Made in Montana."
(Doc. 13 at 2.)
April 18, 2018, Better Than Logs filed a request with the
Patent Office to have the '598 Patent
"reexamined" to determine its validity. (Doc. 10 at
2; Doc. 10-1.) On June 1, 2018, the Patent Office granted
Better Than Logs' request for ex parte
reexamination. (Doc. 10 at 3; Doc. 10-2.) Better Than Logs
filed its Answer on May 15, 2018, denying each of
Everlog's claims and raising two counterclaims, alleging
it has not infringed on the '598 Patent and that the
'598 Patent is invalid. (Doc. 7.)
the Patent Office granted its request for reexamination,
Better Than Logs filed a motion to stay this case pending
reexamination. (Doc. 9.) Everlog opposes the motion, (Doc.
13), which has been fully briefed and is ripe for ruling.
to 35 U.S.C. § 302, "any person" may request
that the Patent Office reexamine an issued patent and present
prior art references that affect the validity of the patent.
The Patent Office then "determine[s] whether a
substantial new question of patentability affecting any claim
of the patent concerned is raised by the request."
Id. at §303(a). "If... a substantial new
question of patentability affecting any claim of a patent is
raised, the determination will include an order for
reexamination of the patent for resolution of the
question." Id. at § 304.
courts are not required to stay judicial resolution in view
of reexamination, a stay for purposes of reexamination is
within the district court's discretion." In re
Cygnus Telecomm. Tech, LLC, Patent Litig., 385 F.Supp.2d
1022, 1023 (N.D. Cal. 2005) (internal citations omitted).
"When determining the appropriateness of a stay pending
reexamination, the court considers the following three
factors: (1) whether a stay would unduly prejudice or present
a clear tactical disadvantage to the nonmoving party; (2)
whether a stay will simplify the issues in question and trial
of the case; and (3) whether discovery is complete and
whether a trial date has been set." Id.
(internal quotations omitted).
Than Logs argues a stay is appropriate to promote judicial
efficiency, simplify the issues, and avoid inconsistent
results. (Doc. 10 at 1-2.) Everlog responds that, because the
delay at the Patent Office will be considerable and will not
resolve all the issues in the case, a stay is not merited.
(Doc. 13 at 2.)
Whether a stay would prejudice or tactically disadvantage
Than Logs argues Everlog will not be prejudiced by a stay.
(Doc. 10 at 15.) Everlog insists that a lengthy stay while
the Patent Office completes its reexamination will prejudice
Everlog by depriving it of its right to assert ...