Posts Tagged: "venue"

The U.S. Court of Appeals for the Federal Circuit (CAFC) today granted Netflix, Inc.’s Petition for Writ of Mandamus to transfer a case brought against it by CA Inc. and Avago Technologies from Judge Rodney Gilstrap’s Eastern District of Texas court to the Northern District of California. The Order is the latest in a series of decisions from the CAFC censuring Texas courts for their refusal to transfer cases. In today’s ruling, the CAFC said the district court’s denial of transfer was a clear abuse of discretion and ordered the court to transfer the case, but did not address Netflix’s motion to dismiss the case for lack of venue.

On November 5, the U.S. Court of Appeals for the Federal Circuit (CAFC) issued a precedential decision in Celgene Corp. v. Mylan Pharmaceuticals Inc. affirming a ruling of the District of Delaware, which dismissed a Hatch-Waxman lawsuit against related Mylan entities for either improper venue or failure to state a claim upon which relief could be granted. In issuing the decision, the Federal Circuit found that Mylan’s submission of a notice letter to Celgene regarding Mylan’s paragraph IV certification to the U.S. Food and Drug Administration (FDA) stating that Mylan’s generic version of the multiple myeloma treatment Pomalyst would not infringe Celgene’s patents was not itself an act of infringement for purposes of the patent venue statute.

On Friday, October 1, the U.S Court of Appeals for the Federal Circuit (CAFC) ordered the latest in a series of recent grants of petitions for writ of mandamus, ordering Judge Alan Albright’s court to vacate its decision to re-transfer a case between Apple and Fintiv  from Austin, Texas back to Waco, Texas. Fintiv originally filed the case in the Waco division of the U.S. Court of Appeals for the Western District of Texas in December 2018, and in September 2019 the district court granted-in-part Apple’s motion to transfer the case to Austin. The court denied Apple’s request to transfer the case to the Northern District of California, but agreed that Austin was more convenient. The trial was scheduled to begin in October 2021, but in September, the court ordered transfer back to Waco, explaining that the COVID-19 pandemic had suspended jury trials for the forseeable future.

On Friday, September 24, the United States Court of Appeals for the Federal Circuit (CAFC) granted Juniper Networks, Inc.’s petition for a writ of mandamus directing Judge Alan Albright of the United States District Court for the Western District of Texas (WD of TX) to transfer six actions to the United States District Court for the Northern District of California, holding that denying the motion to transfer constituted a legal error. The Federal Circuit has repeatedly granted such mandamus petitions from the WD of TX, or ordered Albright to reconsider denials of motions to transfer, in recent months.

On August 3, the U.S. Court of Appeals for the Federal Circuit (CAFC) affirmed the Eastern District of Texas’ partial grant of Victoria’s Secret Stores LLC, Victoria’s Secret Stores Brand Management Inc, and Victoria’s Secret Direct Brand Management’s (the Defendants) motion to dismiss Andra Group, LP’s (Andra’s) patent infringement suit for improper venue. In April 2019, Andra sued the Defendants for infringement of U.S. Patent No. 8,078,498 (‘498 patent), which claims inventions directed to presenting articles on a webpage. Andra’s infringement claims focus on the victoriassecret.com website, and other functional smartphone applications for using the “master display field,” which the ‘498 patent claims.

The U.S. Court of Appeals for the Federal Circuit (CAFC) in In re Samsung today granted Samsung’s and LG’s writs of mandamus, which sought to order the United States District Court for the Western District of Texas to transfer the underlying actions to the United States District Court for the Northern District of California. The CAFC explained that the district court erred in failing to consider pre-litigation tactics by Ikorongo Technology LLC (Ikorongo Tech) and Ikorongo Texas LLC aimed at purposely manipulating venue in the case.

On November 9, the Federal Circuit granted Apple’s petition for a writ of mandamus directing the Western District of Texas to transfer Uniloc’s patent infringement suit against Apple to the Northern District of California. Judge Moore dissented, asserting that the majority applied an incorrect standard of review.

On October 28, the United States Court of Appeals for the Federal Circuit (CAFC) granted a petition for a writ of mandamus directing the United States District Court for the Western District of Texas in In re: Nitro Fluids, L.L.C. In particular, Nitro Fluids petitioned the CAFC for a writ of mandamus directing the district court to dismiss an action or transfer it to the United States District Court for the Southern District of Texas, where an overlapping case was pending. The CAFC granted the petition to the extent that it vacated the district court’s order and directed the district court to conduct further proceedings consistent with the CAFC’s order.

As outlined in Part I of this two-part article, Waco, Texas residents exude a more western mentality than Marshall’s residents. The small town that once served as a pit stop between Dallas and Austin has turned into its own charming cosmopolitan city, serving almost as a bedroom community for those with periodic work in Dallas and Austin…. Instead of attorneys comparing Marshall to Waco, they would be more accurate to compare the Sherman division’s Denton and Collin counties to the Waco division. Comprising about 80% of panelists in a Sherman division jury selection, jurors from both Denton and Collin counties exude a more western independent mentality than other Eastern District of Texas (EDTX) jurors. Denton and Collin counties have recently transitioned from ranching and farming into commuter suburbs a couple of decades ago, and now the counties have their own stand-alone cosmopolitan and sporting areas. Although lacking the diversity of the Sherman division, over time the Waco division’s growth will likely align it more closely to the Sherman division—a division much more friendly to defendants than Marshall.   

On August 13, the United States Court of Appeals for the Federal Circuit (CAFC) affirmed a decision of the U.S. District Court for the Northern District of Illinois in Kahn v. Hemisphere Inc, holding that “the district court did not abuse its discretion in dismissing the action, granting the defendants’ sanctions motion, denying the Khans’ sanctions motion, or denying Merit Medical’s motion for attorney fees under § 285.” Drs. Nazir Khan and Iftikhar Khan filed an action against Hemosphere Inc., CryoLife Inc., and Merit Medical Systems, Inc., and over 300 hospitals and individual physicians, for infringing a claim of U.S. Patent No. 8,747,344, which was directed to an arteriovenous shunt, by “manufacturing or implanting into patients the accused HeRO® Graft shunt.” The Khans sent a waiver of service of summons form and a copy of the complaint to the over 300 defendants, but only three returned a completed waiver form. The district court dismissed without prejudice the Kahns’ claims against Merit Medical, CryoLife, and three physicians  for  improper  venue because “the Khans had not contended that any of these defendants resided in the Northern District of Illinois, and the Khans had failed to plausibly allege that any of them infringed the asserted claim in the district and had a ‘regular and established place of business’ in the district.”

Part I of this article provided an overview of the Federal Circuit’s understanding of the patent venue statute after the Supreme Court’s decision in TC Heartland, and especially the meaning of In re: Google LLC, 949 F.3 1338 (Fed. Cir. 2020) (“SIT”) in this analysis. Part II of the article will address the impact that “machines” may be considered a factor in the analysis of whether venue in a patent infringement can be asserted in a particular location, as raised by the court in Personalized Media Communications LLC v. Google, Netflix, 2:19-CV-00090-JRG (Lead Case). As more and more companies move at least part of their operations online, especially now in response to the COVID-19 crisis, companies, as part of this process, should consider whether this will increase the chances that they will be sued in a district that they regard as unfavorable.

The Court believed the time was now appropriate to address this issue through a writ of mandamus noting that several similar cases had now been heard in various district courts with conflicting results. The Court identified two issues that should be addressed: (1) whether a server rack, a shelf, or analogous space can be a “place of business,” and (2) whether a “regular and established place of business” requires the regular presence of an employee or agent of the defendant conducting business. Finding that a defendant must have regular, physical presence of an employee or other agent of the defendant conducting the defendant’s business at the alleged “place of business,” the Court concluded that the Eastern District of Texas was not a proper venue for this case because Google does not have an employee or agent regularly conducting its business within the District.

On November 13, the Court of Appeals for the Federal Circuit (CAFC) heard an appeal from the U.S. District Court for the Southern District of California in the case of Columbia Sportswear North America, Inc. v. Seirus Innovative Accessories, Inc. (Seirus). Columbia appealed the judgment from a jury trial holding claims 2 and 23 of U.S. Patent 8,453,270 (the ‘270 patent) invalid as anticipated and obvious. Seirus cross-appealed from a grant of summary judgment by the U.S. District Court for the District of Oregon, holding tSeirushat Seirus infringed U.S. Design Patent No. D657,093 (the ‘093 patent). The CAFC affirmed that claims 2 and 23 of the ‘270 patent were invalid, reversed the summary judgment decision against Seirus for infringement of the ‘093 patent and remanded for further proceedings on the design patent.

The Federal Circuit’s decision in In re HTC Corp., 889 F.3d 1349 (Fed. Cir. 2018), considered whether the TC Heartland decision extended to foreign defendants to afford them the protections of the special patent venue statute, 28 U.S.C. § 1400(b). By finding that no such protections existed, the Federal Circuit reaffirmed the longstanding rule that suits against foreign (alien) defendants “are wholly outside the operation of all the federal venue laws, general and special.” HTC, 889 F.3d at 1354 (citing Brunette Machine Works, Ltd. v. Kockum Industries, Inc., 406 U.S. 706, 714 (1972)). While foreign defendants can still try to persuade a district court judge to transfer a case to a new venue on the basis of the parties’ convenience, the venue laws otherwise offer no protection for foreign defendants.

On September 5,  the U.S. Court of Appeals for the Federal Circuit (CAFC) held that state sovereignty principles asserted by the Board of Regents of the University of Texas System (UT) do not give UT the right to bring suit in an improper venue. The appeal clarifies once again that sovereign immunity may be used only as a shield, not a sword. UT argued that Boston Scientific Corporation’s request that the case be transferred to the District of Delaware should be reversed because venue was proper in the Western District of Texas since a state has the right to sue a nonresident in a forum of its choosing where personal jurisdiction is satisfied. It argued that the federal patent venue statute cannot override this sovereign right. UT also argued that the District of Delaware lacks jurisdiction because UT never consented to suit in Delaware, nor did it waive its sovereignty in Delaware or abrogate its sovereignty by statute. The CAFC disagreed with the above, holding that state sovereignty does not allow states to bring patent infringement suits in an improper venue, as is the case where BSC does not have a place of business in Texas. It also held in Regents of University of Cal. V. Eli Lilly & Co. that sovereign immunity does not apply where the state acts only as the plaintiff, and therefore the right of UT to choose the forum does not apply because the Eleventh Amendment only applies to suits against a state, not by a state.