TS Tech's Impact on Transfer Decisions

In response to a writ of mandamus, on Dec. 29, 2008, the Federal Circuit in TS Tech ordered transfer of a patent litigation case out of the Eastern District of Texas. In re TS Tech, 555 F.3d 1315 (Fed. Cir. 2008). Two months before the TS Tech decision issued, the Fifth Circuit issued an en banc transfer decision in response to a writ of mandamus. In re Volkswagen of Am., Inc., 545 F.3d 304 (5th Cir. 2008) (en banc). In Volkswagen, the Fifth Circuit ordered that a product liability case be transferred out of the Eastern District of Texas. TS Tech and, to a lesser extent, Volkswagen have impacted patent litigation transfer decisions in 2009.

In TS Tech, the plaintiff patent owner filed suit in the Eastern District of Texas. The defendant filed a ' 1404 motion to transfer venue to the Southern District of Ohio. The district court denied the motion, and TS Tech petitioned for a writ of mandamus.

The Federal Circuit applied the Fifth Circuit's law that “a motion to transfer venue should be granted upon a showing that the transferee venue is 'clearly more convenient' than the venue chosen by the plaintiff.” TS Tech, 555 F.3d at 1319. In making this determination, the Fifth Circuit applies the “public” and “private” factors for forum non conveniens. Id. “The 'private' interest factors include: (1) the relative ease of access to sources of proof; (2) the availability of compulsory process to secure the attendance of witnesses; (3) the cost of attendance for willing witnesses; and (4) all other practical problems that make a trial easy, expeditious and inexpensive.” Id. “The 'public' interest factors to be considered are: (1) the administrative difficulties flowing from court congestion; (2) the local interest in having localized interests decided at home; (3) the familiarity of the forum with the law that will govern the case; and (4) the avoidance of unnecessary problems of conflicts of law [or in] the application of foreign law.” Id. (quoting Volkswagen II, 545 F.3d at 315).

The Federal Circuit, applying this Fifth Circuit law and, in particular, the Fifth Circuit's recent en banc decision in Volkswagen, identified several issues with the district court's analysis. “First, the district court gave too much weight to Lear's choice of venue under Fifth Circuit law. While the plaintiff's choice of venue is accorded deference, ' Fifth Circuit precedent clearly forbids treating the plaintiff's choice of venue as a distinct factor in the ' 1404(a) analysis. Rather, the plaintiff's choice of venue corresponds to the burden that a moving party must meet in order to demonstrate that the transferee venue is a clearly more convenient venue.” Id. at 1320.

The next issue addressed by the Federal Circuit was the convenience of the witnesses. In TS Tech, all of the identified key witnesses were in Ohio, Michigan, and Canada. The Federal Circuit found that the district court did not properly weigh the inconvenience to the witnesses in traveling to Texas, instead of Ohio. In particular, the Federal Circuit applied the Fifth Circuit's 100-mile rule, which counsels that “'[w]hen the distance between an existing venue for trial of a matter and a proposed venue under ' 1404(a) is more than 100 miles, the factor of inconvenience to witnesses increases in direct relationship to the additional distance to be traveled.'” Id. (quoting In re Volkswagon AG, 371 F.3d 201, 204-05 (5th Cir. 2004)).

The third issue discussed by the Federal Circuit was the relative ease of access to sources of proof. The Federal Circuit found that “[b]ecause all of the physical evidence, including the headrests and the documentary evidence, are far more conveniently located near the Ohio venue, the district court erred in not weighing this factor in favor of transfer.” Id. at 1321.

The Federal Circuit also criticized the district court for disregarding “Fifth Circuit precedent in analyzing the public interest in having localized interests decided at home.” Id.

In particular, “the vehicles containing TS Tech's allegedly infringing headrest assemblies were sold throughout the United States, and thus the citizens of the Eastern District of Texas have no more or less of a meaningful connection to this case than any other venue.” Id.

Since the TS Tech decision issued on Dec. 29, 2008, several district courts have cited TS Tech in transfer decisions. Not surprisingly, because the Federal Circuit applied Fifth Circuit transfer law in TS Tech, district courts in the Fifth Circuit have followed all of the holdings in TS Tech. Conversely, courts outside of the Fifth Circuit have, in some instances, acknowledged but not applied TS Tech and, in other instances, applied some of the holdings in TS Tech. As of May 19, 2009, 22 district court decisions have cited TS Tech.

Transfer Cases from the Fifth Circuit Citing TS Tech

All but one of the Fifth Circuit cases citing TS Tech are from the Eastern District of Texas (one decision coming from the Northern District of Texas). These cases are included in Chart 1.

[IMGCAP(1)]

As shown in Chart 1, half of the transfer decisions have resulted in transfer. In general, these decisions include lengthy discussions of the public and private interest factors from the Fifth Circuit transfer analysis. To determine what particular facts and issues led to the ultimate transfer decision, it is helpful to look at the conclusion sections included in several of these decisions. Several of these sections are provided below.

Cases Denying Transfer

Novartis Vaccines and Diagnostics, Inc. v. Hoffman-La Roche Inc., et al.:

Under the Fifth Circuit's In re Volkswagen standard, the movant must “clearly demonstrate that a transfer is for the convenience of parties and witnesses, [and] in the interest of justice.” 545 F.3d at 314. Because this case is nationwide in scope, each factor is either neutral or does not weigh in favor of transfer as demonstrated above. As such, Defendants have not clearly demonstrated that transfer is appropriate.

Novartis at *6.

J2 Global Communications, Inc. v. Protus IP Solutions, Inc.:

Only one factor weighs slightly in favor of transfer in these cases ' the potential need for compulsory process to secure the testimony of four witnesses. Defendants have not shown that these four witnesses are of critical importance, or even that their testimony is more important than the witness that this Court would have subpoena power over. As more fully explained in the Court's December 23 Order, this is not a situation where the transferee district has had extensive involvement with the patents and products at issue. Nor are these cases where all of the parties and witnesses are localized in one general geographic area. Compare Network-I Sec. Solutions, Inc., 433 F. Supp. 2d at 800 (denying transfer where witnesses were located all over the world); with Odom, 2009 WL 279968 at *4 (granting transfer where all of the witnesses were localized in one general geographic area). Based on this analysis, the Court finds that Defendants have failed to show that transfer to the Central District of California would be clearly more convenient for the parties and witnesses. See Volkswagen II, 545 F.3d at 325. [FN3]

FN3. Even if the Court did not consider the prior art witnesses identified by Easylink and Protus when applying the convenience of witnesses factor in the Captaris case, the Court would deny Captaris' Motion. Because the parties are not localized in one geographic area, this factor would weigh only somewhat in favor of transfer. Because only two factors would weigh slightly in favor of transfer, Captaris cannot meet its burden of showing that transfer would be clearly more convenient for the parties and witnesses.

J2 at *7.

Invitrogen Corp. v. General Electric Co., et al (“Invitrogen 1“):

Under the circumstances presented here, only two factors weigh slightly in favor of transfer ' the convenience of witnesses, and the potential need for compulsory process with regard to three nonparty witnesses ' all other factors are neutral. While some witnesses are in the Northeast, the Court is not persuaded that this overrides the fact that other witnesses are in California and that this forum is more convenient for those witnesses. See Network-I Sec. Solutions, Inc., 443 F. Supp. 2d at 800 (denying transfer where witnesses were not localized in one geographic area); See Aloft Media LLC v. Adobe Sys. Inc. No. 6:07-cv-355, 2008 WL 819956 at *5-7 (Mar. 25, 2008) (same). Unlike the 112 case [Invitrogen 2], this is not a situation where the transferee district has had extensive involvement with the patents and products at issue. Based on this analysis, the Court finds that Defendant has failed to show the transfer to the District of Maryland would be clearly more convenient. See Volkswagen II, 545 F.3d at 315.

Invitrogen 1 at *5.

Cases Granting Transfer

Invitrogen Corp. v. General Electric Co., et al. (“Invitrogen 2″):

Under the circumstances presented here, the concern for judicial economy weighs significantly in favor of transfer, with the other factors neutral or weighing slightly in favor of transfer. While Plaintiff's witnesses reside in California, all other key witnesses reside in the Northeast or England. No Texas resident is a party to this litigation, nor is any Texas state law cause of action asserted. Most importantly, a Maryland court has had extensive involvement with three of the six patents at issue and a settlement agreement was entered into in the Maryland litigation that forms the basis of Defendant's patent exhaustion defense. Based on this analysis, the Court finds that Defendant has shown that transfer to the District of Maryland would be clearly more convenient. See Volkswagen II, 545 F.3d at 315.

Invitrogen 2 at *6.

Fifth Generation Computer Corp. v. International Business Machines Corp.:

After careful analysis of the private and public interest factors, the court concludes that transfer is warranted in this case. Public interest factor 1 weighs against transfer, factors 3 and 4 are neutral, and factor 2 weighs in favor of transfer. Private interest factor 2 is neutral and factor 4 weighs somewhat against transfer. However, factors 1 and 3 ' the relative ease of access to sources of proof and the cost of attendance for witnesses ' both weigh fairly heavily in favor of transfer.

Key to the court's decisions are the facts that no Blue Genes have been sold in Texas; no act of infringement has been identified as occurring in the Eastern District; only one potential witness has been identified as having any connection to Texas at all; multiple potential witnesses are located in or near the Southern District of New York (i.e., two of the inventors, at least one integral member of the research and development team, and the prosecuting attorneys); and both parties have their principal places of business in the Southern District. Although other witnesses and evidence may be located outside of New York, FGC fails to specifically identify any such individuals or documents to the court. Under these facts, transfer to the Southern District of New York is appropriate.

Fifth Generation at *6.

Odom v. Microsoft Corporation, 2009 WL 279968 (E.D. Tex.):

Under the circumstances presented here, the convenience of witnesses and localized interests weigh in favor of transfer with the other factors neutral or weighing slightly in favor of transfer. This is a case that is significantly localized in the Northwest. Both parties are residents of the Northwest, and Microsoft's equitable defenses all arise out of conduct and contracts in the Northwest. No Texas resident is a party to this litigation, nor is any Texas state law cause of action asserted. All identified witnesses ' with the possible exception of one ' are located in the Northwest. This is not a case where witnesses are expected to be traveling from all over the country or world. In summary, there is little convenience to the parties for this case to remain in Texas, while there are several reasons why it should be more convenient for the parties to litigate this case in Oregon.

The Court finds that Defendant has shown that transfer to the District of Oregon would be clearly more convenient. See Volkswagen II, 545 F.3d at 315.

Odom at *7.

In view of these decisions, a road map is forming, which shows what facts support, and what facts weigh against, transfer and how best to present those facts. In short, these facts relate to two issues: 1) the overall regional or national nature of the case; and 2) the importance of related cases. When looking at the regional or national nature of the case, courts pay particular attention to: 1) locations of parties and key third parties, 2) locations of key witnesses, and 3) locations of documents and things that cannot be produced electronically.

For a party seeking to have a case transferred, this developing road map provides insight into the transferee venue to select. That is, while facts of a case may warrant transfer to a venue, that does not mean that transfer will be granted to any venue. Indeed, the analysis is still whether the transferee venue is more convenient.

Overall Regional or National Nature of Case

Following TS Tech, courts in the Fifth Circuit look to whether the case is regional or national. In doing so, they look to the location of parties, witnesses, physical items, and documents that cannot be transferred electronically. In some cases, the court's conclusions lump all of these facts together in making a determination about the national or regional nature of the case. For example, in Partsriver, in a sentence that summarizes the bases for the decision, the court states, “The Court finds that the overall nature of this case, considering all of the involved parties, is regional and would therefore be more conveniently handled by the Northern District of California.” Partsriver at *2; see also, Odom at *7.

In contrast, a finding that a case is nationwide or worldwide can profoundly influence a transfer decision. For example, the conclusion section for Novartis shows that the decision not to transfer was summed up as the case being “nationwide in scope.” Novartis at *6; see also, J2 at *7. Indeed, in the only Federal Circuit decision addressing this issue written after TS Tech, the court upheld the denial of a request to transfer a case from the Eastern District of Texas to the Northern District of Illinois when parties, witnesses, physical items, and documents were not clustered around one region, but were instead spread around the country (parties, witnesses, and documents were located in Chicago, Atlanta, and Dallas).

The location of parties and witnesses and the Fifth Circuit's 100-mile rule were addressed in detail in TS Tech, with the location of the parties and witnesses concentrated in a region close to the transferee district. Fifth Circuit district court cases issuing after TS Tech have been sensitive to the 100-mile rule and convenience of witnesses. However, as discussed in J2, it is important to set forth the relative importance of the witnesses that the parties want considered in this analysis. J2 at *7. (“Only one factor weighs slightly in favor of transfer in these cases ' the potential need for compulsory process to secure the testimony of four witnesses. Defendants have not shown that these four witnesses are of critical importance, or even that their testimony is more important than the witness that this Court would have subpoena power over.”) Moreover, when witnesses are spread throughout the United States or world, this issue does not even slightly favor transfer. See e.g., Invitrogen 1 at *5 (“While some witnesses are in the Northeast, the Court is not persuaded that this overrides the fact that other witnesses are in California and that this forum is more convenient for those witnesses.”)

In re D-Link Corp., 183 Fed. Appx. 967 (Fed. Cir. 2006), an unpublished opinion from the Federal Circuit, addressed the distinction between documents and things that cannot be produced electronically and documents that readily can be produced electronically to any location. In short, the former has a bearing, which is potentially significant, as discussed above, on the ' 1404 determination, while the latter has none. D-Link at *2. This distinction regarding electronically available documents has been followed and noted by several post-TS Tech cases. See e.g., Odom at *3; MHL Tek at *5.

Importance of Related Cases

Related cases can have a significant impact on the transfer decision, based on considerations related to judicial economy and preventing inconsistent adjudications. The importance of this factor is best illustrated by the different outcomes of Invitrogen 1 and 2. In Invitrogen 2, related cases in the transferee forum were the most important fact in the transfer decision. Invitrogen 2 at *6. (“Most importantly, a Maryland court has had extensive involvement with three of the six patents at issue and a settlement agreement was entered into in the Maryland litigation that forms the basis of Defendant's patent exhaustion defense.”) Conversely, in Invitrogen 1, while not identified as the most important fact in the decision not to transfer, the court concluded its decision by stating that, unlike Invitrogen 2, “this is not a situation where the transferee district has had extensive involvement with the patents and products at issue.” Invitrogen 1 at *5.

Another example is in MHL Tek. There, the court discussed judicial economy and preventing inconsistent adjudications in view of two other pending cases involving the exact same patents. In the conclusion section of its opinion, the court specifically noted that “it is necessary to retain this case in order to preserve judicial economy and prevent inconsistent adjudications.” MHL Tek at *7-8.

Cases Outside of the Fifth Circuit Citing TS Tech

As of May 19, 2009, eight decisions outside of the Fifth Circuit have cited TS Tech. Chart 2 lists those decisions.

[IMGCAP(2)]

In Acer, two suits involving overlapping patents were addressed in the transfer decision. The first-filed suit was a declaratory judgment action on nine patents. The suit was filed in the Northern District of California. The second-filed suit was filed by the patent owner in the Eastern District of Texas against the Northern District of California declaratory judgment plaintiffs. The second suit involved seven of the nine patents. The Northern District of California denied the transfer to the Eastern District of Texas. In a footnote, the Northern District of California cited TS Tech for the proposition that “the convenience factors in the instant actions would favor transfer of any litigation between the parties out of the Eastern District of Texas.” Acer at *3 n.8. Thus, part of the decision in Acer was based on the court's belief that the Eastern District of Texas should transfer its case to the Northern District of California.

On Jan. 7, 2009, less than two weeks after the TS Tech decision, the Western District of Wisconsin cited TS Tech in two decisions, Wacoh and Ledalite. In Wacoh, the court summarily addressed TS Tech stating, “I am skeptical of its applicability,” and deciding not to consider TS Tech because “it is unnecessary to the resolution” of the case. Wacoh at *3. In Ledalite, the court distinguished TS Tech based on the facts of the case. Significantly, the court used its “rocket docket” case schedule as a distinguishing factor in the transfer analysis. Ledalite at *3 (“In this case, as in nearly every case before this court, plaintiff has an interest not at issue in TS Tech: speed.”).

Conclusion

TS Tech and, to a lesser extent for patent cases, Volkswagen, have changed the landscape of ' 1404(a) cases in the Fifth Circuit. Patent cases that once would not have been transferred out of the Fifth Circuit may now be transferred based on TS Tech. As such, parties need to be mindful of these cases, and all facts relevant to the public and private interest factors described therein, before proceeding with patent litigation in the Fifth Circuit district courts. In particular, parties need to consider whether the parties, witnesses, physical items, and documents are centered around a single region, or whether related cases give a particular court experience with the claims-at-issue before determining where to file or how to proceed with a transfer request. In courts outside the Fifth Circuit, parties should determine if courts within their circuit-of-interest have applied TS Tech or if the transfer law of the circuit aligns with Fifth Circuit transfer law such that TS Tech, in whole or part, applies.

Trevor Carter is a partner and Brandon Judkins is an associate with Baker & Daniels LLP. They concentrate their practices on patent and other types of intellectual property litigation.

In response to a writ of mandamus, on Dec. 29, 2008, the Federal Circuit in TS Tech ordered transfer of a patent litigation case out of the Eastern District of Texas. In re TS Tech, 555 F.3d 1315 (Fed. Cir. 2008). Two months before the TS Tech decision issued, the Fifth Circuit issued an en banc transfer decision in response to a writ of mandamus. In re Volkswagen of Am., Inc., 545 F.3d 304 (5th Cir. 2008) (en banc). In Volkswagen, the Fifth Circuit ordered that a product liability case be transferred out of the Eastern District of Texas. TS Tech and, to a lesser extent, Volkswagen have impacted patent litigation transfer decisions in 2009.

In TS Tech, the plaintiff patent owner filed suit in the Eastern District of Texas. The defendant filed a ' 1404 motion to transfer venue to the Southern District of Ohio. The district court denied the motion, and TS Tech petitioned for a writ of mandamus.

The Federal Circuit applied the Fifth Circuit's law that “a motion to transfer venue should be granted upon a showing that the transferee venue is 'clearly more convenient' than the venue chosen by the plaintiff.” TS Tech, 555 F.3d at 1319. In making this determination, the Fifth Circuit applies the “public” and “private” factors for forum non conveniens. Id. “The 'private' interest factors include: (1) the relative ease of access to sources of proof; (2) the availability of compulsory process to secure the attendance of witnesses; (3) the cost of attendance for willing witnesses; and (4) all other practical problems that make a trial easy, expeditious and inexpensive.” Id. “The 'public' interest factors to be considered are: (1) the administrative difficulties flowing from court congestion; (2) the local interest in having localized interests decided at home; (3) the familiarity of the forum with the law that will govern the case; and (4) the avoidance of unnecessary problems of conflicts of law [or in] the application of foreign law.” Id. (quoting Volkswagen II, 545 F.3d at 315).

The Federal Circuit, applying this Fifth Circuit law and, in particular, the Fifth Circuit's recent en banc decision in Volkswagen, identified several issues with the district court's analysis. “First, the district court gave too much weight to Lear's choice of venue under Fifth Circuit law. While the plaintiff's choice of venue is accorded deference, ' Fifth Circuit precedent clearly forbids treating the plaintiff's choice of venue as a distinct factor in the ' 1404(a) analysis. Rather, the plaintiff's choice of venue corresponds to the burden that a moving party must meet in order to demonstrate that the transferee venue is a clearly more convenient venue.” Id. at 1320.

The next issue addressed by the Federal Circuit was the convenience of the witnesses. In TS Tech, all of the identified key witnesses were in Ohio, Michigan, and Canada. The Federal Circuit found that the district court did not properly weigh the inconvenience to the witnesses in traveling to Texas, instead of Ohio. In particular, the Federal Circuit applied the Fifth Circuit's 100-mile rule, which counsels that “'[w]hen the distance between an existing venue for trial of a matter and a proposed venue under ' 1404(a) is more than 100 miles, the factor of inconvenience to witnesses increases in direct relationship to the additional distance to be traveled.'” Id. (quoting In re Volkswagon AG, 371 F.3d 201, 204-05 (5th Cir. 2004)).

The third issue discussed by the Federal Circuit was the relative ease of access to sources of proof. The Federal Circuit found that “[b]ecause all of the physical evidence, including the headrests and the documentary evidence, are far more conveniently located near the Ohio venue, the district court erred in not weighing this factor in favor of transfer.” Id. at 1321.

The Federal Circuit also criticized the district court for disregarding “Fifth Circuit precedent in analyzing the public interest in having localized interests decided at home.” Id.

In particular, “the vehicles containing TS Tech's allegedly infringing headrest assemblies were sold throughout the United States, and thus the citizens of the Eastern District of Texas have no more or less of a meaningful connection to this case than any other venue.” Id.

Since the TS Tech decision issued on Dec. 29, 2008, several district courts have cited TS Tech in transfer decisions. Not surprisingly, because the Federal Circuit applied Fifth Circuit transfer law in TS Tech, district courts in the Fifth Circuit have followed all of the holdings in TS Tech. Conversely, courts outside of the Fifth Circuit have, in some instances, acknowledged but not applied TS Tech and, in other instances, applied some of the holdings in TS Tech. As of May 19, 2009, 22 district court decisions have cited TS Tech.

Transfer Cases from the Fifth Circuit Citing TS Tech

All but one of the Fifth Circuit cases citing TS Tech are from the Eastern District of Texas (one decision coming from the Northern District of Texas). These cases are included in Chart 1.

[IMGCAP(1)]

As shown in Chart 1, half of the transfer decisions have resulted in transfer. In general, these decisions include lengthy discussions of the public and private interest factors from the Fifth Circuit transfer analysis. To determine what particular facts and issues led to the ultimate transfer decision, it is helpful to look at the conclusion sections included in several of these decisions. Several of these sections are provided below.

Cases Denying Transfer

Novartis Vaccines and Diagnostics, Inc. v. Hoffman-La Roche Inc., et al.:

Under the Fifth Circuit's In re Volkswagen standard, the movant must “clearly demonstrate that a transfer is for the convenience of parties and witnesses, [and] in the interest of justice.” 545 F.3d at 314. Because this case is nationwide in scope, each factor is either neutral or does not weigh in favor of transfer as demonstrated above. As such, Defendants have not clearly demonstrated that transfer is appropriate.

Novartis at *6.

J2 Global Communications, Inc. v. Protus IP Solutions, Inc.:

Only one factor weighs slightly in favor of transfer in these cases ' the potential need for compulsory process to secure the testimony of four witnesses. Defendants have not shown that these four witnesses are of critical importance, or even that their testimony is more important than the witness that this Court would have subpoena power over. As more fully explained in the Court's December 23 Order, this is not a situation where the transferee district has had extensive involvement with the patents and products at issue. Nor are these cases where all of the parties and witnesses are localized in one general geographic area. Compare Network-I Sec. Solutions, Inc., 433 F. Supp. 2d at 800 (denying transfer where witnesses were located all over the world); with Odom, 2009 WL 279968 at *4 (granting transfer where all of the witnesses were localized in one general geographic area). Based on this analysis, the Court finds that Defendants have failed to show that transfer to the Central District of California would be clearly more convenient for the parties and witnesses. See Volkswagen II, 545 F.3d at 325. [FN3]

FN3. Even if the Court did not consider the prior art witnesses identified by Easylink and Protus when applying the convenience of witnesses factor in the Captaris case, the Court would deny Captaris' Motion. Because the parties are not localized in one geographic area, this factor would weigh only somewhat in favor of transfer. Because only two factors would weigh slightly in favor of transfer, Captaris cannot meet its burden of showing that transfer would be clearly more convenient for the parties and witnesses.

J2 at *7.

Invitrogen Corp. v. General Electric Co., et al (“Invitrogen 1“):

Under the circumstances presented here, only two factors weigh slightly in favor of transfer ' the convenience of witnesses, and the potential need for compulsory process with regard to three nonparty witnesses ' all other factors are neutral. While some witnesses are in the Northeast, the Court is not persuaded that this overrides the fact that other witnesses are in California and that this forum is more convenient for those witnesses. See Network-I Sec. Solutions, Inc., 443 F. Supp. 2d at 800 (denying transfer where witnesses were not localized in one geographic area); See Aloft Media LLC v. Adobe Sys. Inc. No. 6:07-cv-355, 2008 WL 819956 at *5-7 (Mar. 25, 2008) (same). Unlike the 112 case [Invitrogen 2], this is not a situation where the transferee district has had extensive involvement with the patents and products at issue. Based on this analysis, the Court finds that Defendant has failed to show the transfer to the District of Maryland would be clearly more convenient. See Volkswagen II, 545 F.3d at 315.

Invitrogen 1 at *5.

Cases Granting Transfer

Invitrogen Corp. v. General Electric Co., et al. (“Invitrogen 2″):

Under the circumstances presented here, the concern for judicial economy weighs significantly in favor of transfer, with the other factors neutral or weighing slightly in favor of transfer. While Plaintiff's witnesses reside in California, all other key witnesses reside in the Northeast or England. No Texas resident is a party to this litigation, nor is any Texas state law cause of action asserted. Most importantly, a Maryland court has had extensive involvement with three of the six patents at issue and a settlement agreement was entered into in the Maryland litigation that forms the basis of Defendant's patent exhaustion defense. Based on this analysis, the Court finds that Defendant has shown that transfer to the District of Maryland would be clearly more convenient. See Volkswagen II, 545 F.3d at 315.

Invitrogen 2 at *6.

Fifth Generation Computer Corp. v. International Business Machines Corp.:

After careful analysis of the private and public interest factors, the court concludes that transfer is warranted in this case. Public interest factor 1 weighs against transfer, factors 3 and 4 are neutral, and factor 2 weighs in favor of transfer. Private interest factor 2 is neutral and factor 4 weighs somewhat against transfer. However, factors 1 and 3 ' the relative ease of access to sources of proof and the cost of attendance for witnesses ' both weigh fairly heavily in favor of transfer.

Key to the court's decisions are the facts that no Blue Genes have been sold in Texas; no act of infringement has been identified as occurring in the Eastern District; only one potential witness has been identified as having any connection to Texas at all; multiple potential witnesses are located in or near the Southern District of New York (i.e., two of the inventors, at least one integral member of the research and development team, and the prosecuting attorneys); and both parties have their principal places of business in the Southern District. Although other witnesses and evidence may be located outside of New York, FGC fails to specifically identify any such individuals or documents to the court. Under these facts, transfer to the Southern District of New York is appropriate.

Fifth Generation at *6.

Odom v. Microsoft Corporation, 2009 WL 279968 (E.D. Tex.):

Under the circumstances presented here, the convenience of witnesses and localized interests weigh in favor of transfer with the other factors neutral or weighing slightly in favor of transfer. This is a case that is significantly localized in the Northwest. Both parties are residents of the Northwest, and Microsoft's equitable defenses all arise out of conduct and contracts in the Northwest. No Texas resident is a party to this litigation, nor is any Texas state law cause of action asserted. All identified witnesses ' with the possible exception of one ' are located in the Northwest. This is not a case where witnesses are expected to be traveling from all over the country or world. In summary, there is little convenience to the parties for this case to remain in Texas, while there are several reasons why it should be more convenient for the parties to litigate this case in Oregon.

The Court finds that Defendant has shown that transfer to the District of Oregon would be clearly more convenient. See Volkswagen II, 545 F.3d at 315.

Odom at *7.

In view of these decisions, a road map is forming, which shows what facts support, and what facts weigh against, transfer and how best to present those facts. In short, these facts relate to two issues: 1) the overall regional or national nature of the case; and 2) the importance of related cases. When looking at the regional or national nature of the case, courts pay particular attention to: 1) locations of parties and key third parties, 2) locations of key witnesses, and 3) locations of documents and things that cannot be produced electronically.

For a party seeking to have a case transferred, this developing road map provides insight into the transferee venue to select. That is, while facts of a case may warrant transfer to a venue, that does not mean that transfer will be granted to any venue. Indeed, the analysis is still whether the transferee venue is more convenient.

Overall Regional or National Nature of Case

Following TS Tech, courts in the Fifth Circuit look to whether the case is regional or national. In doing so, they look to the location of parties, witnesses, physical items, and documents that cannot be transferred electronically. In some cases, the court's conclusions lump all of these facts together in making a determination about the national or regional nature of the case. For example, in Partsriver, in a sentence that summarizes the bases for the decision, the court states, “The Court finds that the overall nature of this case, considering all of the involved parties, is regional and would therefore be more conveniently handled by the Northern District of California.” Partsriver at *2; see also, Odom at *7.

In contrast, a finding that a case is nationwide or worldwide can profoundly influence a transfer decision. For example, the conclusion section for Novartis shows that the decision not to transfer was summed up as the case being “nationwide in scope.” Novartis at *6; see also, J2 at *7. Indeed, in the only Federal Circuit decision addressing this issue written after TS Tech, the court upheld the denial of a request to transfer a case from the Eastern District of Texas to the Northern District of Illinois when parties, witnesses, physical items, and documents were not clustered around one region, but were instead spread around the country (parties, witnesses, and documents were located in Chicago, Atlanta, and Dallas).

The location of parties and witnesses and the Fifth Circuit's 100-mile rule were addressed in detail in TS Tech, with the location of the parties and witnesses concentrated in a region close to the transferee district. Fifth Circuit district court cases issuing after TS Tech have been sensitive to the 100-mile rule and convenience of witnesses. However, as discussed in J2, it is important to set forth the relative importance of the witnesses that the parties want considered in this analysis. J2 at *7. (“Only one factor weighs slightly in favor of transfer in these cases ' the potential need for compulsory process to secure the testimony of four witnesses. Defendants have not shown that these four witnesses are of critical importance, or even that their testimony is more important than the witness that this Court would have subpoena power over.”) Moreover, when witnesses are spread throughout the United States or world, this issue does not even slightly favor transfer. See e.g., Invitrogen 1 at *5 (“While some witnesses are in the Northeast, the Court is not persuaded that this overrides the fact that other witnesses are in California and that this forum is more convenient for those witnesses.”)

In re D-Link Corp., 183 Fed. Appx. 967 (Fed. Cir. 2006), an unpublished opinion from the Federal Circuit, addressed the distinction between documents and things that cannot be produced electronically and documents that readily can be produced electronically to any location. In short, the former has a bearing, which is potentially significant, as discussed above, on the ' 1404 determination, while the latter has none. D-Link at *2. This distinction regarding electronically available documents has been followed and noted by several post-TS Tech cases. See e.g., Odom at *3; MHL Tek at *5.

Importance of Related Cases

Related cases can have a significant impact on the transfer decision, based on considerations related to judicial economy and preventing inconsistent adjudications. The importance of this factor is best illustrated by the different outcomes of Invitrogen 1 and 2. In Invitrogen 2, related cases in the transferee forum were the most important fact in the transfer decision. Invitrogen 2 at *6. (“Most importantly, a Maryland court has had extensive involvement with three of the six patents at issue and a settlement agreement was entered into in the Maryland litigation that forms the basis of Defendant's patent exhaustion defense.”) Conversely, in Invitrogen 1, while not identified as the most important fact in the decision not to transfer, the court concluded its decision by stating that, unlike Invitrogen 2, “this is not a situation where the transferee district has had extensive involvement with the patents and products at issue.” Invitrogen 1 at *5.

Another example is in MHL Tek. There, the court discussed judicial economy and preventing inconsistent adjudications in view of two other pending cases involving the exact same patents. In the conclusion section of its opinion, the court specifically noted that “it is necessary to retain this case in order to preserve judicial economy and prevent inconsistent adjudications.” MHL Tek at *7-8.

Cases Outside of the Fifth Circuit Citing TS Tech

As of May 19, 2009, eight decisions outside of the Fifth Circuit have cited TS Tech. Chart 2 lists those decisions.

[IMGCAP(2)]

In Acer, two suits involving overlapping patents were addressed in the transfer decision. The first-filed suit was a declaratory judgment action on nine patents. The suit was filed in the Northern District of California. The second-filed suit was filed by the patent owner in the Eastern District of Texas against the Northern District of California declaratory judgment plaintiffs. The second suit involved seven of the nine patents. The Northern District of California denied the transfer to the Eastern District of Texas. In a footnote, the Northern District of California cited TS Tech for the proposition that “the convenience factors in the instant actions would favor transfer of any litigation between the parties out of the Eastern District of Texas.” Acer at *3 n.8. Thus, part of the decision in Acer was based on the court's belief that the Eastern District of Texas should transfer its case to the Northern District of California.

On Jan. 7, 2009, less than two weeks after the TS Tech decision, the Western District of Wisconsin cited TS Tech in two decisions, Wacoh and Ledalite. In Wacoh, the court summarily addressed TS Tech stating, “I am skeptical of its applicability,” and deciding not to consider TS Tech because “it is unnecessary to the resolution” of the case. Wacoh at *3. In Ledalite, the court distinguished TS Tech based on the facts of the case. Significantly, the court used its “rocket docket” case schedule as a distinguishing factor in the transfer analysis. Ledalite at *3 (“In this case, as in nearly every case before this court, plaintiff has an interest not at issue in TS Tech: speed.”).

Conclusion

TS Tech and, to a lesser extent for patent cases, Volkswagen, have changed the landscape of ' 1404(a) cases in the Fifth Circuit. Patent cases that once would not have been transferred out of the Fifth Circuit may now be transferred based on TS Tech. As such, parties need to be mindful of these cases, and all facts relevant to the public and private interest factors described therein, before proceeding with patent litigation in the Fifth Circuit district courts. In particular, parties need to consider whether the parties, witnesses, physical items, and documents are centered around a single region, or whether related cases give a particular court experience with the claims-at-issue before determining where to file or how to proceed with a transfer request. In courts outside the Fifth Circuit, parties should determine if courts within their circuit-of-interest have applied TS Tech or if the transfer law of the circuit aligns with Fifth Circuit transfer law such that TS Tech, in whole or part, applies.

Trevor Carter is a partner and Brandon Judkins is an associate with Baker & Daniels LLP. They concentrate their practices on patent and other types of intellectual property litigation.