On August 31, 2017, Judge Chappel of the Middle District of Florida granted a motion to transfer due to improper venue in Herbert E. Townsend, v. Brooks Sports, Inc., Civ. No. 2:17-cv-62-FtM-38MRM (M.D. Fla. Aug. 31, 2017). The court held that employing a full-time information technology specialist in the judicial district was insufficient to create a "regular and established place of business" under the second prong of the patent venue statute, 28 U.S.C. § 1400(b). In reaching this decision, Judge Chappel declined to adopt the four-part test for determining a "regular and established place of business" that the Eastern District of Texas articulated in Raytheon Co. v. Cray, Inc., Civ. No. 2-15-cv-01554, 2017 U.S. Dist. LEXIS 100887, 2017 WL 2813896 (E.D. Tex. Jun. 29, 2017).
Based on the Complaint and declarations filed in support of the motion to transfer, the court found that the defendant, Brooks Sports, Inc., resides and operates in the Western District of Washington and China. The court noted that Brooks’ only U.S. facilities are in Washington and that the activities relating to the accused products occurred in Washington. The court therefore held that the Western District of Washington is the most appropriate forum for the case because it is the “center of gravity” of the allegedly infringing activities. In support of this finding, the court cited Saint-Gobain Calmar, Inc. v. Nat’l Prods. Corp., 230 F. Supp. 2d 655, 660 (E.D. Pa. 2002).
The Court also expressly declined to adopt the four-factor Raytheon balancing test where “it is clear from the Complaint and the evidence submitted by the parties that Brooks has no regular and established place of business in this District.” Moreover, in contrast to the ruling in Raytheon, the court held that the presence of an employee in the judicial district – a “’Guru’ that supplies knowledge about Brooks’ products at racing events throughout Florida” – was insufficient to give rise to a regular and established place of business. The court further noted that the presence of “a full-time IT employee [who] works remotely from Florida” and “two non-employee independent contractors” did not rise to the level of a regular and established place of business. Instead of focusing on the residence of Brooks’ employees, the court focused on the location of its physical facilities, including the lack of facilities in Florida and the existence of facilities in Washington and overseas where Brooks developed the allegedly infringing products.
Having found venue improper in Florida, the Townsend court transferred the case to the Western District of Washington. A number of other post-TC Heartland decisions have resulted in venue transfers. See, e.g., IP Corp. v. Riddell, Inc., Civ. No. 2:17-cv-443-JRG (E.D. Tex. Aug. 28, 2017); InVue Security Products Inc. v. Mobile Tech, Inc. 3-15-cv-00610 (W.D. N.C. Aug. 21, 2017) (Order, Judge Max O. Cogburn, Jr., Dkt. 65). Interestingly, however, the transfers in those cases were effectuated despite finding venue to be proper in the original forum.