The IP Litigation Team at Fried Frank is continuously tracking the impact of TC Heartland. Every week, we provide a roundup of the courts’ latest orders and opinions concerning venue-related issues in patent infringement cases.
The summaries below are grouped by topic and cover the period September 13 – September 21, 2017.
Regular and Established Place of Business
In In re Cray, Inc., No. 2017-129 (Fed. Cir. Sept. 21, 2017), the Federal Circuit held that the “regular and established place of business” prong of 28 U.S.C. § 1400(b) requires “a physical place within the district” that is the “place of the defendant.” Applying this standard, the court held that the residential home office of an employee in the Eastern District of Texas is not a “regular and established place of business” for the purposes of venue. (Id. at 15.) The Federal Circuit’s decision directly rejects the much-publicized test for venue that Judge Gilstrap articulated in Raytheon Co. v. Cray, Inc., No. 15-cv-01554 (E.D. Tex. June 29, 2017). (Id. at 10.) The decision will also likely alter the venue analysis that Judge Stark recently set forth in a pair of decisions in Delaware, which required a physical “presence,” but not necessarily a physical “place” that is the “place of the defendant.” See Boston Scientific Corp. v. Cook Group Inc., 15-cv-980 (D. Del. Sept. 11, 2017); Bristol-Myers Squibb Co. v. Mylan Pharmaceuticals Inc., No. 17-cv-379 (D. Del. Sept. 11, 2017). Our full analysis of In re Cray is available here.
No Waiver of Objection to Venue
In Nautilus Inc. v. Icon Health & Fitness, Inc., No. 16-cv-5393 (W.D. Wash. Sept. 13, 2017), the court allowed the defendant to amend its answer to assert an objection to venue. The court then granted the defendant’s motion to transfer venue to the District of Utah. It was undisputed that the defendant, Icon Health & Fitness, is not incorporated in Washington and does not maintain a regular and established place of business there. Instead, the plaintiff argued that Icon unreasonably delayed in raising its venue objection by waiting 87 days after the TC Heartland opinion to file its motion. The court held that the defendant had not waived its venue challenge, but declined to hold that TC Heartland constituted an intervening change in the law. Instead, the court found that there would be no prejudice to Nautilus in transferring the case given that the parties’ preparation for the Markman hearing would be similarly useful in the new venue.
Discovery Regarding Venue
In Telebrands Corp. v. Illinois Industrial Tool, Inc., No. 17-cv-3411 (D.N.J. Sept. 18, 2017), the court granted the defendant’s motion to transfer venue to the Northern District of Illinois. The court found that the defendant demonstrated that it had no regular and established place of business through a declaration of its chief financial officer. Plaintiff Telebrands conceded that it had no evidence of the defendant maintaining a regular and established place of business in New Jersey. Telebrands, however, requested expedited discovery to determine whether venue was proper. The court rejected the request, holding that a plaintiff must do more than make conclusory assertions that venue is proper in order to obtain venue-related discovery. Our recent analysis of the standards for obtaining venue-related discovery can be found here.