Traxcell Techs. v. Verizon Wireless Pers. Commc'ns

ALAN D. ALBRIGHT, UNITED STATES DISTRICT JUDGE

PUBLIC AMENDED MEMORANDUM OPINION AND ORDER

Public version of Dkt. No. 63. The parties confirmed this Order has no confidential information.

ALAN D. ALBRIGHT, UNITED STATES DISTRICT JUDGE

Before the Court is Verizon Wireless Personal Communications, LP (“Verizon”) and Ericsson Inc.'s (“Ericsson”) (collectively “Defendants”) Motion to Transfer. After considering the parties' briefs (Dkt. Nos. 22, 34, 35), the Court DENIES defendants' motion to transfer. This Amended Memorandum Opinion and Order corrects the Memorandum Opinion and Order, Dkt. No. 54, which is now vacated.

I. BACKGROUND

Plaintiff filed this lawsuit on December 21, 2020, accusing Verizon of patent infringement. Dkt. No. 1. On February 5, 2021, Plaintiff amended its complaint to add Ericsson as a defendant. Dkt. No. 10. On October 25, 2021, Plaintiff filed a third amended complaint. Dkt. No. 41. Each complaint alleges infringement of U.S. Patent Nos. 10, 701, 517 (“the '517 Patent”), 10, 743, 135 (“the '135 Patent”), and 10, 820, 147 (“the '147 Patent”) (collectively, “Patents-in-Suit”). The first and second amended complaints also allege infringement of U.S. Patent Nos. 9, 549, 388 (“the '388 Patent”) and 10, 820, 147 (“the '147 Patent”). Dkt. Nos. 1, 10.

Plaintiff accuses Ericsson's self-organization technology, as implemented in Verizon's network, of infringing the '175 Patent, the '517 Patent, and the '135 Patent, which relate to network optimization technology. The '196 Patent and '147 Patent relate to navigation systems. Plaintiff accuses Apple Maps of infringing the '196 Patent. Plaintiff accuses Google Maps and VZ Navigator of infringing the '147 Patent. Google Maps and Apple Maps are third-party mapping programs, and Google and Apple are the best sources for information on those products. Dkt. No. 22 at 2.

At the time of filing, Plaintiff intended to sue Apple for infringing the Patents-in-Suit in the Western District of Texas due to lack of proper venue in the Eastern district of Texas. Dkt. No. 34-3 ¶¶ 4-7. Before filing this suit, Traxcell sued many defendants for infringing the same or related patents in the Eastern District of Texas. Dkt. No. 22 at 5-9 (citing cases).

II. LEGAL STANDARD

In patent cases, motions to transfer under 28 U.S.C. § 1404(a) are governed by the law of the regional circuit. In re TS Tech USA Corp., 551 F.3d 1315, 1319 (Fed. Cir. 2008). 28 U.S.C. § 1404(a) provides that, “[f]or the convenience of parties and witnesses, . . . a district court may transfer any civil action to any other district or division where it might have been brought or to any district or division to which all parties have consented.” “Section 1404(a) is intended to place discretion in the district court to adjudicate motions for transfer according to an ‘individualized, case-by-case consideration of convenience and fairness.'” Stewart Org., Inc. v. Ricoh Corp., 487 U.S. 22, 29 (1988) (quoting Van Dusen v. Barrack, 376 U.S. 612, 622 (1964)).

The preliminary question under Section 1404(a) is whether a civil action might have been brought in the transfer destination venue. In re Volkswagen, Inc., 545 F.3d 304, 312 (5th Cir. 2008) (“Volkswagen II”). If the destination venue would have been a proper venue, then “[t]he determination of ‘convenience' turns on a number of public and private interest factors, none of which can be said to be of dispositive weight.” Action Indus., Inc. v. U.S. Fid. & Guar. Co., 358 F.3d 337, 340 (5th Cir. 2004). The private 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 trial of a case easy, expeditious and inexpensive.” In re Volkswagen AG, 371 F.3d 201, 203 (5th Cir. 2004) (“Volkswagen I”) (citing Piper Aircraft Co. v. Reyno, 454 U.S. 235, 241 n.6 (1981)). The public factors include: “(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 conflict of laws of the application of foreign law.” Id. Courts evaluate these factors based on the situation which existed at the time of filing, rather than relying on hindsight knowledge of the defendant's forum preference. Hoffman v. Blaski, 363 U.S. 335, 343 (1960).

The burden to prove that a case should be transferred for convenience falls on the moving party. Volkswagen II, 545 F.3d at 314. The burden that a movant must carry is not that the alternative venue is more convenient, but that it is clearly more convenient. Id. at 314-15. Although the plaintiff's choice of forum is not a separate factor entitled to special weight, respect for the plaintiff's choice of forum is encompassed in the movant's elevated burden to “clearly demonstrate” that the proposed transferee forum is “clearly more convenient” than the forum in which the case was filed. Id. While “clearly more convenient” is not necessarily equivalent to “clear and convincing, ” the moving party “must show materially more than a mere preponderance of convenience, lest the standard have no real or practical meaning.” Quest NetTech Corp. v. Apple, Inc., No. 2:19-cv-118, 2019 WL 6344267, at *7 (E.D. Tex. Nov. 27, 2019).

III. ANALYSIS

A. The Threshold Inquiry Permits Transfer

Plaintiff previously sued Verizon on related patents in the Easter District of Texas. Traxcell Techs., LLC v. Verizon Communications, Inc., No. 2:17-cv-00721 (E.D. Tex.), D.I. 1 (filed October 31, 2017). Defendants satisfied the threshold inquiry of whether this case could also have been brought in the Eastern District of Texas.

B. The Private Interest Factors Are Neutral.

i. The Relative Ease of Access to Sources of Proof is Neutral.

“In considering the relative ease of access to proof, a court looks to where documentary evidence, such as documents and physical evidence, is stored.” Fintiv Inc. v. Apple Inc., No. 6:18-cv-00372, 2019 WL 4743678, at *2 (W.D. Tex. Sept. 10, 2019). “[T]he question is relative ease of access, not absolute ease of access.” In re Radmax, 720 F.3d 285, 288 (5th Cir. 2013) (emphases in original). “In patent infringement cases, the bulk of the relevant evidence usually comes from the accused infringer. Consequently, the place where the defendant's documents are kept weighs in favor of transfer to that location.” In re Apple Inc., 979 F.3d 1332, 1340 (Fed. Cir. 2020) (citing In re Genentech, 566 F.3d at 1345).

Although the physical location of electronic documents does affect the outcome of this factor under current Fifth Circuit precedent (see Volkswagen II, 545 F.3d at 316), this Court has stressed that the focus on physical location of electronic documents is out of touch with modern patent litigation. Fintiv, 2019 WL 4743678, at *8. “[A]ll (or nearly all) produced documents exist as electronic documents on a party's server. Then, with a click of a mouse or a few keystrokes, the party produces these documents” and makes them available at almost any location. Uniloc 2017 LLC v. Apple Inc., 6-19-CV-00532-ADA, 2020 WL 3415880, at *9 (W.D. Tex. June 22, 2020). Other courts in the Fifth Circuit similarly found that access to documents that are available electronically provides little benefit in determining whether a particular venue is more convenient than another. See, e.g., Uniloc USA Inc. v. Samsung Elecs. Am., Inc., No. 2:16-CV-638-JRG, 2017 WL 11631407, at *4 (E.D. Tex. Apr. 19, 2017) (“Despite the absence of newer cases acknowledging that in today's digital world computer stored documents are readily moveable to almost anywhere at the click of a mouse, the Court finds it odd to ignore this reality in favor of a fictional analysis that has more to do with early Xerox machines than modern server forms.”).

Here, the parties have not identified any physical evidence that would sway this factor one way or another. According to Defendants, “none of the parties maintain their documents related to the Accused Products in the Western District of Texas.” Dkt. No. 22 at 12. Traxcell has its office in Marshall, Texas, but Plaintiff identified no physical evidence there requiring transport. Dkt. No. 14 ¶ 1. Ericsson has its headquarters in Plano, Texas, but this headquarters sits closer to the courthouse in Waco than to the courthouse in Marshall. Dkt. No. 34-1 ¶¶ 6, 7.

According to Defendants, Google and Apple are the best sources for information on the accused products. Dkt. No. 22 at 2. Neither party identified the locations of Google's physical evidence or Apple's physical evidence. As a result, this factor is neutral.

ii. The Availability of Compulsory Process to Secure the Attendance of Witnesses slightly weighs against transfer.

Plaintiff intends to subpoena a witness from Verizon Business located at 6600 Sanger Ave, Waco, TX 76710. Dkt. No. 34 at 5. Defendants identify no witnesses in the Eastern District of Texas who fall outside this Court's subpoena power. Dkt. No. 22 at 14. As a result, this factor disfavors transfer, but because Plaintiff fails to explain the importance of its witness, this factor disfavors transfer only slightly.

iii. The Cost of Attendance for Willing Witnesses Is Neutral.

“The convenience of witnesses is the single most important factor in the transfer analysis.” Fintiv, 2019 WL 4743678, at *6. “Courts properly give more weight to the convenience of non-party witnesses than to party witnesses.” Netlist, Inc. v. SK Hynix Inc., No. 6:20-CV-00194-ADA, 2021 WL 2954095, at *6 (W.D. Tex. Feb. 2, 2021); see Moskowitz Family LLC v. Globus Med., Inc., No. 6:19-cv-00672-ADA, 2020 WL 4577710, at *4 (W.D. Tex. Jul. 2, 2020).

The parties dispute the residence of inventor Mark Jeff Reed. Dkt. No. 22 at 13; Dkt. No. 34 at 6. Based on a January 2019 deposition transcript, Mr. Reed resides in Plano, Texas. Dkt. No. 23-1. Mr. Reed does not rebut this in his declaration, though he appears to have moved to Waco only after filing this lawsuit. Dkt. No. 34-3. Given his residence at the time of filing, the convenience of Mr. Reed weighs slightly in favor of transfer.

Plaintiff identifies co-inventor Stephen Palik and prosecuting lawyer Mitch Harris as witnesses who find Waco more convenient than Marshall or Texarkana. Dkt. No. 34 at 6. The convenience of these witnesses weighs against transfer.

Defendants identify Steven Rice, Brian Zhang, and Rodrigo Correia as witnesses. Dkt. No. 22 at 14. They reside beyond both districts. Id. The convenience of these witnesses favors neither district over the other.

In totality, the convenience of the witnesses is neutral.

iv. All Other Practical Problems Slightly Favors Transfer.

When considering the private interest factors, courts must consider “all other practical problems that make trial of a case easy, expeditious and inexpensive.” Volkswagen II, 545 F.3d at 315. “Particularly, the existence of duplicative suits involving the same or similar issues may create practical difficulties that will weigh heavily in favor or against transfer.” PersonalWeb Techs., LLC v. NEC Corp. of Am., Inc., No. 6:11-cv-655, 2013 WL 9600333, at *5 (E.D. Tex. Mar. 21, 2013).

Motions to transfer venue are to be decided based on “the situation which existed when suit was instituted.” In re EMC Corp., 501 Fed.Appx. 973, 976 (Fed. Cir. 2013) (citations and quotations omitted). “While considerations of judicial economy arising after the filing of a suit do not weigh against transfer, a district court may properly consider any judicial economy benefits which would have been apparent at the time the suit was filed.” Id. at 976. A district court's “experience with a patent in prior litigation and the co-pendency of cases involving the same patent are permissible considerations in ruling on a motion to transfer venue.” Id. “[C]ourts have consistently held that judicial economy plays a paramount role in trying to maintain an orderly, effective, administration of justice.” In re Vistaprint Ltd., 628 F.3d 1342, 1346 (Fed. Cir. 2010).

Judicial economy favors transfer because the Eastern District of Texas has significant experience with the same patent family, the same parties, and the same accused products. Dkt. No. 22 at 5-9 (citing cases). A case involving the '196 Patent also remains pending in the Eastern District of Texas against different defendants. Id. at 11.

The Court further considers the judicial economy benefits which would have been apparent at the time the suit was filed, including Plaintiff's plans to file suit against Apple in the Western District of Texas for infringement of the Patents-in-Suit. Dkt. No. 34-1 ¶¶ 2-3. The case against Apple will not transfer to the Eastern District of Texas due to improper venue for Apple. Id. So, “no matter what this Court orders, the '196 patent-and Apple Maps-will be litigated in two forms.” Dkt. No. 22 at 11. This non-transferrable case greatly undercuts the efficiency gained by transfer. This Court must handle all stages of litigation against Apple for each of the Patents-in- Suit and finds only minor efficiency gains, if any, will result from adding a parallel case against Verizon and Ericsson to the Eastern District of Texas without removing the case against Apple.

In conclusion, transfer will add the Patents-in-Suit for efficient adjudication in the Eastern District of Texas, but without lessening the duplicate burden in the Western District of Texas. As a result, this factor favors transfer, but only slightly so.

C. The Public Interest Factors Are Neutral.

i. Administrative Difficulties is Neutral.

Both parties agree this factor is neutral. Dkt. No. 22 at 15; Dkt. No. 34 at 7.

ii. Local Interest Is Neutral.

Under this factor, the Court must evaluate whether there is a local interest in deciding local issues at home. Volkswagen II, 545 F.3d at 317. “A local interest is demonstrated by a relevant factual connection between the events and the venue.” Word to Info, Inc. v. Facebook, Inc., No. 3:14-cv-04387-K, 2015 WL 13870507, at *4 (N.D. Tex. Jul. 23, 2015).

Defendants argue for a greater local interest because Traxcell, inventor Mark Reed, and Ericsson's U.S. Headquarters are located in the Eastern District of Texas. Dkt. No. 22 at 15. The Patents-in-Suit contain method claims, and a greater number of allegedly infringing customers per county reside in the Western District of Texas. Dkt. No. 34 at 5; Dkt. No. 34-7 at 33:12-37:7. These allegedly infringing customers infringers have a local interest in the resolution of this case.

The Court finds the competing interests cancel out. This factor is neutral.

iii. Familiarity of the Forum With the Law Is Neutral.

This factor is neutral. Patent claims are governed by federal law, and both courts capably apply patent law to infringement claims. In re TS Tech USA Corp., 551 F.3d 1315, 1320 (Fed. Cir. 2008)

iv. Avoidance of Conflict of Laws Is Neutral.

This factor is neutral because regardless of what the Court orders, the '196 Patent and Apple maps will see litigation in both the Eastern and Western Districts of Texas. Dkt. No. 22 at 11; Dkt. No. 34 at 8.

IV. CONCLUSION

Having considered the Section 1404(a) factors, the Court finds that Defendants have not met its significant burden to demonstrate that the Eastern District of Texas is “clearly more convenient” than this District. In totality, the factors are neutral. Therefore, the Court DENIES Defendants' Motion to Transfer.

The moving party is reminded to comply with the Court's Standing Order Regarding Filing Documents Under Seal and Redacted Public Versions.