Quality Gold, Inc. v. West

Filing 13

ORDER granting 3 Defendant's Motion to Transfer Case; denying 10 Motion for Leave to File Sur-Reply. Case transferred to the Northern District of California. Signed by Judge Sandra S Beckwith on 5/22/12. (mb)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF OHIO
WESTERN DIVISION
Quality Gold, Inc.,

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) Case No. 1:11-CV-891
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Plaintiff,
vs.
Trent West,
Defendant.

O R D E R
This matter is before the Court on Defendant Trent
West’s motion to dismiss or transfer the case.

(Doc. No. 3).

Also pending is Plaintiff Quality Gold, Inc.’s motion to file a
sur-reply brief. Doc. No. 10.

Because the Court finds that

transferring this case to the United States District Court for
the Northern District of California pursuant to 28 U.S.C. §
1404(a) is appropriate, Defendant’s motion to transfer is welltaken and is GRANTED.

Plaintiff’s motion to file a sur-reply

brief is not well-taken and is DENIED.
Defendant Trent West holds a number of patents directed
toward methods for making tungsten or tungsten carbide jewelry
rings.

As is relevant here, West owns U.S. Patent 6,928,734

(“the ’734 Patent”), dated August 16, 2005, U.S Patent 7,032,314
(“the ’314 Patent”), dated April 25, 2006, and U.S. Patent
8,061,033 (“the ’033 Patent”), dated November 22, 2011.

These

patents are family members of a patent application filed in
September 1997 which matured into U.S. Patent 6,062,045.
In July 2010, West sued Quality Gold, Inc. (“QGI”) in
district court in the Northern District of California for
infringement of the ’734 Patent and the ’314 Patent.

QGI in turn

filed third-party complaints against Jewelry Innovations, Inc.,
GMA, Inc., and Glenn A. Wright seeking indemnity on the grounds
that these entities sold the alleged accused rings to QGI and
violated warranties of non-infringement.

In May 2011, West filed

a second lawsuit against QGI in the Northern District of
California which asserted a “false marking” claim pursuant to 35
U.S.C. § 292.

The false marking case alleges that QGI falsely

advertised that its tungsten carbide rings were patented when no
such patent had been issued.

The district court determined that

the infringement case and the false marking case are related and
both cases are now pending before Judge Davila.
As can be seen, the ’033 Patent was issued to West in
November 2011.

In December 2011, West sent QGI a cease and

desist letter asserting that tungsten rings sold by QGI infringe
the ’033 Patent.

As a result of receiving the cease and desist

letter, QGI filed in this Court a complaint for a declaratory
judgment of invalidity and/or non-infringement of the ’033
Patent.

According to QGI’s complaint, QGI is an Ohio corporation

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with its principal place of business in Fairfield, Ohio and West
is a resident of the State of California.
West now moves the Court to dismiss QGI’s complaint or
transfer it to the Northern District of California under two
theories.

West argues that there is a “substantial overlap”

between QGI’s declaratory judgment action and the two lawsuits
between the two parties pending in the Northern District of
California.

Therefore, West argues that this case should be

transferred to California pursuant to the “first-to-file” rule.
Alternatively, West argues that this case should be transferred
to California pursuant to 28 U.S.C. § 1404(a) “for the
convenience of parties and witnesses” and “in the interests of
justice.”

In support of the latter argument, West contends that

QGI’s declaratory judgment complaint can be resolved more
efficiently if transferred to California because of the
similarity of the patents-in-suit and Judge Davila’s greater
familiarity with the patents, the accused products, and the
technology involved.

West also argues that the convenience of

the parties favors a transfer to California since they are
already engaged in litigation in that district and none of the
other factors, such as the ability to compel the attendance of
witnesses and ease of access to sources of proof, weigh against a
transfer.

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In opposition, QGI disputes that there is a substantial
overlap between the Ohio case and the California cases.

QGI

points out that, although in the same family as the ’734 and ’314
Patents, the ’033 Patent must given its own independent
construction.

Therefore, QGI believes that Judge Davila’s

experience with these patents will not be particularly helpful in
resolving claims concerning the ’033 Patent.

QGI also observes

that Judge Davila has only presided over his cases for about six
months, and contends, therefore, that his head start over this
Court in becoming familiar with the patents and technology is not
substantial.

Thus, QGI contends that judicial economy would not

be achieved by transferring this case to California.

QGI also

contends that it would be more inconvenient for its COO to
litigate this case in California because it would add the burden
and expense of this case onto the burden and expense of
litigating the other two cases in California.

QGI claims that

transferring this case to California is not more convenient and
would simply shift the costs of litigation from West to it, which
is inappropriate.
Section 1404(a) of Title 28 provides:
For the convenience of parties and witnesses, in the
interest of justice, 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.

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28 U.S.C. 1404(a).

The parties do not dispute that QGI’s

declaratory judgment action “might have been brought” in the
Northern District of California.

The only issue, therefore, is

whether the convenience of the parties and witnesses, and the
interests of justice, indicate that the case should be
transferred.
“A motion to transfer venue should be granted upon a
showing that the transferee venue is clearly more convenient than
the venue chosen by the plaintiff.”

In re Genentech, Inc., 566

F.3d 1338, 1342 (Fed. Cir. 2009) (internal quotation marks
omitted).

In considering a § 1404(a) transfer in a patent case,

the district court must consider the “private interest” factors
and the “public interest” factors.

Id.

The public interest

factors include 1) the relative ease of access of sources to
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 a trial
easy, expeditious, and inexpensive.

Id.

The public interest

factors include: 1) the administrative difficulties flowing from
court congestion; 2) the localized 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 conflicts of laws or in the application
of foreign law.

Id.

However, “consideration of the interest of

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justice, which includes judicial economy, may be determinative to
a particular transfer motion, even if the convenience of the
parties and witnesses might call for a different result.”
Regents of the Univ. of Ca. v. Eli Lilly & Co., 119 F.3d 1559,
1565 (Fed. Cir. 1997).

Thus, “in a case . . . in which several

highly technical factual issues are presented and the other
relevant factors are in equipoise, the interest of justice may
favor transfer to a court that has become familiar with the
issues.”

Id.

In this case, the Court concludes that the factors

weigh clearly in favor of transferring this case to the Northern
District of California.
First, neither party has identified any difficulties in
procuring the attendance of witnesses in California or that
access to sources of proof relevant to the ’033 Patent would be
more difficult in California.
neutral.

Thus, these two factors are

QGI has indicated that it would impose an additional

burden on its COO to be required to travel to California to
litigate this case as well as the other two cases.

While the

Court is not unmindful of the additional burden, it is an
incremental burden and by itself does not require denying the
motion.

Indeed, this situation is somewhat similar to a case

like Genentech in which the Federal Circuit held that it was only
incidentally more burdensome for European parties to have to
litigate the case in California instead of Texas.

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566 F.3d at

1345.

Moreover, both parties are represented by experienced and

able counsel; surely they have an interest in avoiding
duplication of effort and can coordinate the three cases to
reduce the burdens on everyone.

Thus, the private interest

factors are neutral or, at worst, weigh only slightly against a
transfer.
Second, the balance of public interest factors is
neutral.

There are no particularized issues of local or foreign

law to be resolved.

QGI has identified only a very slight

difference between the time to resolve cases in the Northern
District of California versus the Southern District of Ohio.
While Ohio would have an interest in the resolution of patent
infringement claims of its citizen QGI, California surely has an
interest in enforcing the patent rights of its resident, West.
Thus, the public interest factors are neutral.
In summary, balance of the private and public factors
at worst weighs only slightly against transferring this case to
the Northern District of California.

In the end, however, it is

the similarity of the two cases and the California court’s
greater familiarity with the patents and technology which shows
that the interests of justice weigh clearly in favor of granting
a transfer.

While QGI has pointed to some differences between

and among the patents-in-suit, it is not disputed that they have
common terms and belong to the same family, which generally would

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require that they be interpreted similarly.

NTP, Inc. v.

Research In Motion, Ltd., 418 F.3d 1282, 1293 (Fed. Cir. 2005)
(“Because NTP’s patents all derive from the same parent
application and share many common terms, we must interpret the
claims consistently across all asserted patents.”).

Having

already completed claim construction on the ’734 and ’314
Patents, the California court is in the best position to construe
the ’033 Patent efficiently.

While QGI argues that Judge Davila

is only slightly more familiar with the patents than this Court,
in a recent order denying transfer of the false marking case to
this district, he expressed “existing familiarity with tungsten
finger rings, their market, and other issues relevant to the
patent action[.]” Doc. No. 8-2, at 5 n.4.

Thus, Judge Davila’s

greater familiarity with the patents, the accused products, and
the technology involved will, in the Court’s opinion, lead to a
more efficient resolution of QGI’s declaratory judgment action.
In the only cases that this Court has discovered where
the district judge’s greater familiarity with the patents was
deemed inconsequential, the forum district had no other
connection with the parties and the forum district was a
manifestly more inconvenient place to litigate the case.

See,

e.g., In re Verizon Bus. Net. Serv., Inc., 635 F.3d 559, 561-62
(Fed. Cir. 2011) (judge’s familiarity with patent from a suit
that settled five years earlier did not justify refusal to

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transfer case where transferee district was clearly more
convenient); In re Zimmer Holdings, Inc., 609 F.3d 1378 (Fed.
Cir. 2010) (district judge’s familiarity with single overlapping
patent did not justify refusing to transfer case to a more
convenient forum; plaintiff had little or no connection to forum
district and most of the parties, witnesses, and evidence were
located in or near the transferee district); In re Morgan
Stanley, 417 Fed. Appx. 947 (Fed. Cir. 2011) (accord).

In

contrast to these cases, here the parties have already been
involved in a substantial amount of litigation in the Northern
District of California and, thus, they both have a substantial
connection with that district.

Moreover, also in contrast to

these cases, Judge Davila’s experience with the patents-in-suit
is direct, recent, and relevant to the issues likely to arise in
litigation with the ’033 Patent.

Therefore, the Court concludes

that this case falls under Eli Lilly and justifies transferring
this case to the Northern District of California because the
public and private factors are basically in equipoise and because
of the Judge Davila’s greater familiarity with the patents and
products involved.
QGI has filed a motion to file a sur-reply (Doc. No.
10) arguing that West misrepresented the status of the California
false marking case and that recent developments in that case
indicate that there is further dissimilarity between that case

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and this declaratory judgment action which weigh against a
transfer.

The Court is not persuaded that filing a sur-reply

brief is required.

Even if no false marking case were pending at

all in the Northern District of California, given that the other
considerations are in equipoise, the similarity of issues between
the patents-in-suit in the two infringement-related cases and
Judge Davila’s greater familiary with the patents and technology
would alone justify a transfer.

Accordingly, QGI’s motion to

file a sur-reply brief is not well-taken and is DENIED.
Accordingly, West’s motion to transfer is well-taken
and is GRANTED.

The Clerk of Court is ORDERED to transfer this

case to the United States District Court for the Northern
District of California pursuant to 28 U.S.C. 1404(a).

IT IS SO ORDERED

Date May 22, 2012

s/Sandra S. Beckwith
Sandra S. Beckwith
Senior United States District Judge

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