The dispute between Echostar (Dish Network) and Tivo has manifested itself in two separate lawsuits with Tivo being the plaintiff in the first suit and defendant in the second. In the first suit, Tivo sued Echostar for infringement of their patents in the digital video recording technology. An injunction was granted in favor of Tivo but is currently not being enforced pending a stay in the proceedings. In the second case, Echostar is suing Tivo for infringing three of Echostar�s patents. Presently, there is a stay in the proceedings of the Echostar v. Tivo (second) case while the court waits for the USPTO to re-examine the patents at issue. In making her ruling, Magistrate Judge Craven stated that the court goes through a cost/benefit analysis before granting or denying a stay. She explained that a stay will benefit the district court proceedings upon the completion of a reexamination for a myriad of reasons. These reasons all relate to streamlining the process of litigation because the USPTO�s expertise can be used to eliminate issues that would otherwise have to be dealt with in court. Also, the findings made by the USPTO may encourage settlements, and if the patent is invalidated, the suit will most likely be dismissed altogether, thereby conserving judicial resources. As a consequence of this increased efficiency, costs will be lessened for all involved. The benefit of streamlined litigation is manifest in the estoppel consequences of the inter partes re-exam of one Echostar patent. Judge Craven states that:

a third-party requester is estopped from relitigating the same issue “which the third-party requester raised or could have raised during the inter partes reexamination proceedings.” 35 U.S.C. Ã?§ 315(c); see also Middleton, Inc. v. Minnesota Mining and Mfg. Co., 2004 WL 1968669, *10 (S.D. Iowa, 2004). In addition, the third-party requester will be estopped from seeking review of factual determinations made in the inter partes reexamination.

This has been discussed in both Patently-O and Peter Zura’s Two-Seventy-One Patent Blog, but the thrust of the order is that deference to the re-examination by the USPTO will serve to streamline future litigation in the ways enumerated above. Essentially, this method of re-examination will settle multiple validity issues of the lawsuit and preclude both the parties and potential third parties from litigating them at a later date. You can read the order in PDF form here.