Following the recent U.S. Court of Appeals for the Fifth Circuit Volkswagen case, the U.S. Court of Appeals for Federal Circuit directed transfer of a patent infringement case, on a petition for writ of mandamus, from the U.S. District Court for the Eastern District of Texas to the U.S. District Court for the Southern District of Ohio, finding the latter to be “clearly more convenient” than the Eastern District. In re TS Tech USA Corp., Misc. Docket No. 888 (Fed. Cir., Dec. 29, 2008) (precedential order) (Rader, J.).
In October 2008, the Fifth Circuit issued an en banc opinion in Volkswagen that acknowledged a petition for a writ of mandamus as an appropriate vehicle for contesting a trial court venue determination and directed the trial court to transfer a products liability case, under 28 U.S.C. § 1404(a), out of the Eastern District. (See IP Update, Vol. 11, No. 11.) Many practitioners wondered whether the Federal Circuit would apply the Fifth Circuit jurisprudence to patent infringement suits filed in the Eastern District of Texas (E. D. Texas), a venue widely perceived as patent friendly.
Lear filed a patent infringement suit in the E.D. Texas against TS Tech based on a Lear patent relating to pivotally attached vehicle headrest assemblies. The court denied TS Tech’s forum non convenience motion under 28 U.S. C. § 1404(a) seeking transfer of the case to the Southern District of Ohio. TS Tech then filed a petition for writ of mandamus at the Federal Circuit, contending that the district court ignored precedent and clearly abused its discretion by refusing to transfer the case, arguing that there was no connection between the case and the E.D. Texas.
The Federal Circuit agreed, finding the district court made several keys errors in its analysis, which together amounted to a clear abuse of discretion. First, the Federal Circuit found that the district court gave too much weight to the plaintiff’s choice of venue, treating it as a “factor” against transfer. Second, the Federal Circuit found that the district court ignored Fifth Circuit precedent in assessing the cost of attendance for witnesses. Third, the Federal Circuit found that the district court erred by reading out of the § 1404(a) analysis the factor regarding the relative ease of access to sources of proof. Finally the Federal Circuit found that the district court disregarded Fifth Circuit precedent in analyzing the public interest in having localized interests decided at home. Citing the Fifth Circuit decision in Volkswagen, the Federal Circuit granted the writ, “[b]ecause the district court’s errors here are essentially identical [to those in the Volkswagen case], we hold that TS Tech has demonstrated a clear and indisputable right to a writ.” The Federal Circuit directed the district court to vacate its transfer order and to transfer the case to the District Court for the Southern District of Ohio.
Practice Note: Both in this case and in Volkswagen, the appellate court analysis focused on failures of the district court to properly consider the various § 1404(a) factors. It is unclear whether the Federal Circuit (or the Fifth Circuit in Volkswagen) would have found an abuse of discretion if it thought the district court had at least considered and weighted the §1404(a) factors and yet still decided to deny transfer. However, it now seems likely that venue transfer motions in the Eastern District of Texas will receive more analytical consideration (per the Fifth Circuit and Federal Circuit decisions) and more defendants will likely file forum non convenience motions and disappointed litigants will be more likely to file writs.