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Equalia, LLC v. Kushgo LLC

United States District Court, D. Nevada

March 8, 2017

EQUALIA, LLC and HOVBERBOARD TECHNOLOGIES CORPORATION, Plaintiff,
v.
KUSHGO LLC, et al., Defendants.

          ORDER DEFENDANTS' MOTION TO STAY (ECF NO. 54)

          RICHARD F. BOULWARE, II UNITED STATES DISTRICT JUDGE

         I. INTRODUCTION

         Before the Court is Defendants Motion to Stay (ECF Nos. 54). The Court has reviewed the parties' papers and heard oral argument. For the reasons stated below, the Court denies the Motion.

         II. BACKGROUND

         Plaintiffs Equalia, LLC, and Hoverboard Technologies Corporation filed a Complaint on Dec. 9, 2016. ECF No. 1. Plaintiffs filed an Emergency Motion for TRO and Preliminary Injunction on Dec. 28, 2016. ECF No 10. At the hearing on January 4, 2017, the Court granted the TRO as to the CES trade show only. ECF No. 37. Plaintiffs filed a Motion for a Preliminary Injunction on January 10, 2017. ECF No. 42. The Court filed its written order granting the TRO on January 11, 2017. ECF No. 43. The Court held a hearing on the Motions for a Preliminary Injunction, ECF Nos. 10, 42, on January 13, 2017. EF No. 51. On January 20, 2017, the Court issued a nationwide injunction barring Defendants from displaying, depicting, advertising, marketing, or selling the Halo Board or any substantially similar version thereof online or in any physical location nationwide. ECF No. 50. On January 26, 2017, Defendants filed the Motion to Stay pending appeal. ECF Nos. 54, 55. Plaintiffs responded on January 27, 2017, and Defendants replied on February 1, 2017. ECF Nos. 56, 57.

         III. LEGAL STANDARD

         A. Stay

         “[W]e must apply the four factors that always guide our discretion to issue a stay pending appeal: “(1) whether the stay applicant has made a strong showing that he is likely to succeed on the merits; (2) whether the applicant will be irreparably injured absent a stay; (3) whether issuance of the stay will substantially injure the other parties interested in the proceeding; and (4) where the public interest lies.” Standard Havens Products, Inc. v. Gencor Industries, Inc., 897 F.2d 511, 512 (9th Cir. 1990).

         “[T]he four stay factors can effectively merge . . . [I]n considering whether to grant a stay pending appeal, this court assesses movant's chances for success on appeal and weighs the equities as they affect the parties and the public . . . The more likely the plaintiff is to win, the less heavily need the balance of harms weigh in his favor; the less likely he is to win, the more need it weigh in his favor.” Id. (internal citations and quotation marks omitted).

         B. Preliminary Injunction

         A preliminary injunction is “an extraordinary remedy that may only be awarded upon a clear showing that the plaintiff is entitled to such relief.” Winter v. Natural Res. Def. Council, Inc., 555 U.S. 7, 22 (2008). To obtain a preliminary injunction, a plaintiff must establish four elements: “(1) a likelihood of success on the merits, (2) that the plaintiff will likely suffer irreparable harm in the absence of preliminary relief, (3) that the balance of equities tip in its favor, and (4) that the public interest favors an injunction.” Wells Fargo & Co. v. ABD Ins. & Fin. Servs., Inc., 758 F.3d 1069, 1071 (9th Cir. 2014), as amended (Mar. 11, 2014) (citing Winter, 555 U.S. at 20).

         To prove a likelihood of success on the merits in a case alleging patent infringement, the plaintiff “must show that, in light of the presumptions and burdens that will inhere at trial on the merits, (1) it will likely prove that [the Defendants infringe on the Plaintiffs'] patent and (2) its infringement claim will likely withstand [Defendants'] challenges to the validity and enforceability of the . . . patent.” Genentech, Inc. v. Novo Nordisk A/S, 108 F.3d 1361, 1364 (Fed. Cir. 1997). Raising a “substantial question” as to “validity, enforceability, or infringement” defeats a request for a preliminary injunction based on patent infringement. Id.

         The Ninth Circuit has also held that a preliminary injunction may issue under the “serious questions” test. Alliance for the Wild Rockies v. Cottrell, 632 F.3d 1127, 1134 (9th Cir. 2011). According to this test, a plaintiff can obtain a preliminary injunction by showing “that serious questions going to the merits were raised and the balance of hardships tips sharply in the plaintiff's favor.” Id. at 1134-35 (citation omitted).

         In considering a preliminary injunction alleging patent infringement, the precedent of the Federal Circuit applies to substantive issues within the domain of patent law. See Hybritech ...


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