United States District Court, N.D. Illinois, Eastern Division
May 5, 2005.
TRADING TECHNOLOGIES INTERNATIONAL, INC., Plaintiff,
ESPEED, INC., Defendant.
The opinion of the court was delivered by: JAMES MORAN, Senior District Judge
MEMORANDUM OPINION AND ORDER
On August 12, 2004, plaintiff brought this action claiming that
defendant's software infringed its patents. After intensive
accelerated discovery, extensive briefing, and tutorials, this
court ruled on the preliminary injunction on February 9, 2005.
Two weeks later, on February 23, 2005, plaintiff filed Trading
Technologies International v. REFCO Group Ltd., LLC, (REFCO), 05
C 1079, alleging infringement of the same patents by another
company. The case was assigned to Judge Wayne Andersen. Plaintiff
moves, pursuant to Local Rule 40.2, for reassignment of 05 C 1079
to this court. That motion is, for now, denied.
The cases involve the same property. They are both pending in
the Northern District of Illinois. But, after that, things get
rather muddy. The handling of both cases by the same judge may
likely result in a substantial saving of judicial time and
effort. The cases have common validity issues, and this court has
to some extent already dealt with them, although how the
defendants approach those issues may somewhat differ. Plaintiff
points out that we have construed the claims, but that was not a
Markman determination; rather, it was a preliminary
determination incident to the preliminary injunction motion. Even
so, this court does have a head start on that issue, even though eSpeed, Inc.
can still be heard and REFCO has yet to be heard at all. Perhaps
we have a head start on the infringement issue, but we are
unfamiliar with REFCO's product.
On the other hand, the most immediate dispute in 05 C 1079
involves defendants' counterclaims. REFCO (presently several
REFCO entities are defendants, but we ignore that distinction
because it is, for present purposes, irrelevant) is a licensee of
plaintiff, and it is vigorously opposing plaintiff's termination
of those licenses. It claims that plaintiff is in breach of
contract and attempting to obtain monopoly control for this kind
of software by hitching continuation of the licenses to
acceptance of plaintiff's proposal of a five cents override on
every transaction, permanently, whether or not the trader uses
any of plaintiff's technology. It is a rather novel proposal if
a trader has to pay an override regardless, he has every
incentive to use plaintiff's software rather than pay plaintiff
and also someone else to use that person's software. Plaintiff
contends the termination is because REFCO is infringing its
patent (including, possibly, by some use of eSpeed software), and
therefore construction of the claims is implicated. We doubt
that; we have no reason to believe that REFCO contends that
plaintiff does not have a good faith belief that REFCO is
infringing its patents. The license dispute is not something that
is present in 04 C 5312, and we doubt that its resolution by
Judge Andersen will substantially increase judicial time and
The major impediment to a finding of relatedness is that 05 C
1079 is just getting started. Apparently settlement efforts
delayed prosecution until April 25, 2005, just a few days ago.
The dimensions of that lawsuit remain unclear. In the meantime,
04 C 5312 has been hotly contested since last August. At a status
on June 7, 2005, it may be possible to close discovery, and the
parties have talked about a fall trial. Perhaps the timing will
change so that reassignment makes sense. We are also mindful that still more
lawsuits are undoubtedly waiting in the wings. It may be that it
may make more sense to let 04 C 5312 proceed to conclusion and
have it as the bellwether case. But it is just too early to tell.
In those circumstances, we are reluctant to find relatedness
immediately on the motion of a party who has had some favorable
rulings in the earlier case. There is lurking here a possible
forum-shopping aspect to the whole thing.
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