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 November 18, 2017 – November 24, 2017.
Meaning of “Regular and Established Place of Business”
In Treehouse Avatar LLC v. Valve Corp., 15-cv-0427 (D. Del. Nov. 20, 2017), the court first found that defendant Valve Corp had not waived its right to raise the improper venue defense, relying on the Federal Circuit’s recent ruling in In re Micron. 1 . The court then held that servers operated by Valve’s customers, which hosted games for other customers, did not constitute a place of business of Valve. Plaintiff Treehouse argued that Valve’s customers acted as surrogates for Valve’s primarily online business. The court, however, refused to issue an opinion that could “turn any cell phone, laptop, or computer into a regular and established place of business.” As such, the court granted Valve’s motion to transfer for improper venue.
Waiver of Objection to Venue
In Intellectual Ventures II LLC v. FedEx Corp. et al., 16-cv-00980 (E.D. Tex. Nov. 22, 2017), the court found that defendant FedEx Corp had waived its right to challenge venue by activity participating in the litigation. The court reasoned that the defendant had engaged in extensive discovery and considerable judicial resources had been expended in the case. Moreover, the court noted that the defendant had implicitly conceded that venue was proper when it moved to transfer for convenience under § 1404 (rather than challenging venue as improper under § 1406). The court also emphasized that reopening the question of venue would prejudice the plaintiff. Consequently, defendant’s motion to transfer was denied. The decision demonstrates that, despite the Federal Circuit’s ruling in In re Micron, the Eastern District of Texas will continue to find in many cases that defendants waived their right to challenge venue.
In In re Carbonite, Inc., 2018-101 (Fed. Cir. Nov. 22, 2017), the Federal Circuit denied a petition for writ of mandamus, stating that the question of waiver of the objection to venue had been addressed in the recent In re Micron opinion. As such, the appropriate approach would be to file a motion for reconsideration before the district court, rather than a petition for mandamus.