McCain Foods Limited v. J.R. Simplot Company
OPINION and Order Signed by the Honorable Sara L. Ellis on 8/9/2017. Mailed notice (nsf, )
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ILLINOIS
McCAIN FOODS LIMITED,
J.R. SIMPLOT COMPANY,
No. 17 C 1326
Judge Sara L. Ellis
OPINION AND ORDER
Plaintiff McCain Foods Limited (“McCain”) alleges that Defendant J.R. Simplot
Company (“Simplot”) is guilty of infringing McCain’s potato patents. Simplot wants to contest
this case on different soil, moving to transfer venue to the United States District Court for the
District of Idaho pursuant to 28 U.S.C. § 1404(a). Because the convenience of the parties and
the interest of justice favor transfer, the Court grants Simplot’s motion  and transfers
McCain’s suit and Simplot’s counterclaim to the District of Idaho.
McCain is a Canadian company operating under the laws of the Province of New
Brunswick and has its corporate office in Toronto, Canada. McCain’s subsidiary, McCain USA,
is a Maine corporation with a principal place of business in Lisle, Illinois. Simplot is a Nevada
corporation with a principal place of business in Boise, Idaho and admits that “[f]or purposes of
this action only . . . venue is proper in this district[.]” Doc. 22 ¶ 7.
In addressing Simplot’s motion to transfer, the Court is not obligated to limit its consideration to the
pleadings. See Cont’l Cas. Co. v. Am. Nat’l Ins. Co., 417 F.3d 727, 733 (7th Cir. 2005). The Court
resolves all factual conflicts and draws all reasonable inferences in McCain’s favor. Harris v. comScore,
Inc., 825 F. Supp. 2d 924, 926 (N.D. Ill. 2011).
Both companies sell French fries and potato products. McCain’s Patent No. 6,821,540
(“the ’540 Patent”), relates to “Process for Treating Vegetables and Fruit Before Cooking.”
McCain claims that Simplot’s pulsed electric field (PEF) systems, infringe the ‘540 Patent.
Simplot has three PEF system machines, two located in their processing plant in Idaho, and one
at their facility in North Dakota. Simplot acquired these PEF systems from Food Physics, the
United States distributor for Elea Vertriebs–und–Vermarktungsgesellschaft, mbH (“Elea”).
Food Physics is located in Boise, and has employees and documents related to those systems at
Patent No. D720,916 (“the ’916 Patent”), entitled “Root Vegetable Product,” is for the
design of a twisted ornamental root vegetable product, or a spiral French fry. McCain claims
that Simplot spiral French fries, called SIDEWINDERS™, infringe on McCain’s ’916 Patent.
Simplot developed SIDEWINDERS™ in its facility in Caldwell, Idaho and produces them there.
Simplot worked with AceCo Precision Manufacturing, Inc. (“AceCo”) and JST Manufacturing,
both located in Boise, to produce SIDEWINDERS™ potatoes.
Simplot countersued McCain for invalidity of McCain’s two patents.
Section 1404 Transfer
Section 1404(a) states that the Court may transfer venue to another district “for the
convenience of parties and witnesses, in the interest of justice.” 28 U.S.C. § 1404(a). For
transfer to be appropriate, Simplot must demonstrate that “(1) venue is proper in this district; (2)
venue is proper in the transferee district; (3) the transferee district is more convenient for both
the parties and the witnesses; and (4) transfer would serve the interest of justice.” Gueorguiev v.
Max Rave, LLC, 526 F. Supp. 2d 853, 856 (N.D. Ill. 2007). Simplot bears the burden of
demonstrating that transfer is “clearly more convenient.” Heller Fin. Inc. v. Midwhey Powder
Co., 883 F.2d 1286, 1293 (7th Cir. 1989) (quoting Coffey v. Van Dorn Iron Works, 796 F.2d 217,
219–20 (7th Cir. 1986)). The transfer decision is committed to the Court’s sound discretion
because the “weighing of factors for and against transfer necessarily involves a large degree of
subtlety and latitude.” Coffey, 796 F.2d at 219.
The Court addresses first where venue is proper. Before and during briefing on Simplot’s
motion, the parties did not contest that venue is proper in the District of Idaho and they currently
have related ongoing litigation there.2 As to whether venue is proper here, “Section 1404(a) may
only be invoked if venue is proper in the district where the case was filed.” Johnson v. United
Airlines, Inc., No. 12 C 5842, 2013 WL 323404, at *2 (N.D. Ill. Jan. 25, 2013). In its Answer
and motion to transfer under § 1404, Simplot agreed with McCain that venue is proper in this
District. Then the Supreme Court issued its opinion in TC Heartland LLC v. Kraft Foods Grp.
Brands LLC, --- U.S. ----, 137 S. Ct. 1514, 1520, 197 L. Ed. 2d 816 (2017), which reestablished
more limited venue in patent cases than the Federal Circuit had previously allowed. After TC
Heartland, Simplot asked the Court to consider whether venue was proper in this District. But
because Simplot’s Answer and motion accept McCain’s allegation that venue is proper, the
Court does not need to resolve Simplot’s request to further review whether venue is proper here.3
With neither venue here nor in the District of Idaho an issue, the Court turns to whether transfer
would serve the convenience of the parties and witnesses and serve the interest of justice.
Simplot answered that venue is proper and did not move to dismiss based on improper venue.
As discussed below, if TC Heartland applies to render venue improper here, the Court would consider
28 U.S.C. § 1406. See In re LimitNone, LLC, 551 F.3d 572, 575 (7th Cir. 2008) (noting that when venue
is improper a dismissal or transfer under § 1406(a) may become appropriate). But because the Court
finds that transfer is appropriate under § 1404 and because transfer or dismissal would be necessary if
venue was not proper, the Court need not resolve the issue. See Johnson, 2013 WL 323404, at *2
(“Because the same result obtains under either provision, there is no need to decide which one applies and
therefore no need to decide whether venue is proper in this District.”).
Convenience of the Parties and Witnesses
In evaluating the convenience of the parties and witnesses, the Court considers “(1) the
plaintiff’s choice of forum; (2) the situs of material events; (3) the relative ease of access to
sources of proof; (4) the convenience of the witnesses; and (5) the convenience to the parties of
litigating in the respective forums.” Brandon Apparel Grp., Inc. v. Quitman Mfg. Col., 42 F.
Supp. 2d 821, 833 (N.D. Ill. 1999).
First, courts typically give a plaintiff’s choice of forum substantial deference, particularly
where the chosen forum is the plaintiff’s home forum. Id. This deference is lessened “where
the plaintiff’s chosen forum is not the plaintiff’s home forum or has relatively weak connections
with the operative facts giving rise to the litigation.” Body Sci. LLC. v. Boston Sci. Corp., 846 F.
Supp. 2d 980, 992 (N.D. Ill. 2012). For this factor, the Court considers only McCain’s suit;
Simplot’s countersuit in this case operates as a denial of McCain’s claims. See generally Nalco
Co. v. Envtl. Mgmt., Inc., 694 F. Supp. 2d 994, 997 (N.D. Ill. 2010) (finding that counterclaims
and third-party complaint had no operative effect on motion to transfer). McCain is incorporated
under the laws of the Province of New Brunswick, Canada, but operates its U.S. operations
through its subsidiary, McCain Foods, which is headquartered in the Northern District of Illinois.
Simplot has no facilities or employees located in Illinois, and its only connection with the district
is through the sales of its products, which are sold nationwide. “Sales alone are insufficient to
establish a substantial connection to the forum if the defendant’s goods are sold in many states.”
Anchor Wall Sys., Inc. v. R & D Concrete Prods., Inc., 55 F. Supp. 2d 871, 874 (N.D. Ill. 1999).
The design and development of SIDEWINDERS™ takes place in Idaho, and all marketing and
distribution decisions are made there as well. Moreover, none of the infringing PEF systems are
in Illinois, nor did Simplot purchase these systems in Illinois. While the Northern District of
Illinois is effectively McCain’s home district, the connection between the district and the facts at
issue is no greater than any other district, meaning McCain’s choice of forum is entitled to
“some, but not substantial, deference.” Hanley v. Omarc, Inc., 6 F. Supp. 2d 770, 775 (N.D. Ill.
1998) (giving some but not all deference to plaintiff’s choice of forum because Illinois lacked a
connection to the underlying case). Consequently, this factor weighs slightly against transfer.
Second, in patent cases, courts generally focus on the location of the infringer’s principal
place of business since these cases center on the infringer’s activities and documents. Body Sci.,
846 F. Supp. 2d at 993; Habitat Wallpaper and Blinds, Inc. v. K.T. Scott Ltd. P’ship, 807 F.
Supp. 470, 474 (N.D. Ill. 1992). Generally, this factor alone is not sufficient to override a
plaintiff’s choice of forum, but like other factors, it does weigh against it. Abbott Labs. v.
Church & Dwight, Inc., No. 07 C 3428, 2007 WL 3120007, at *3 (N.D. Ill. Oct. 23, 2007) (“[A]
defendant seeking to transfer venue to another district cannot simply point to its principal place
of business in another district and prevail automatically. The Court must give appropriate weight
to the plaintiff’s forum choice.”). McCain worries that giving this factor too much weight would
make it impossible to bring suit against a non-resident infringer. However, this is simply one
factor among others and is not dispositive; rather, it weakens the deference given to McCain’s
choice of forum. See id.; Body Sci., 846 F. Supp. 2d at 992. Additionally, if infringing materials
can be found in both the transferor and the transferee districts, the situs of material events
becomes less relevant. Carson v. Flexible Foam Prods., Inc., No. 08-cv-095-bbc, 2008 WL
1901727, at *2 (W.D. Wis. Apr. 23, 2008). Some courts have also found that the place of injury
factors into the situs of events when the injury occurs mostly in one location. See, e.g., SRAM
Corp. v. SunRace Roots Enter. Co., Ltd., 953 F. Supp. 257, 259 (N.D. Ill. 1997) (considering the
fact that infringing goods were sold in the transferor district, but finding that the situs of event
factor still favored transferring the case since the majority of sales were not in the district).
Here, Simplot’s principal place of business is in Boise, Idaho, and Simplot has no
facilities or employees in Illinois. Simplot’s research, design, production, and development of its
SIDEWINDERS™ product occurred in Idaho, and all sales and marketing decisions regarding
the product also happened there. Doc. 29 ¶¶ 6, 7. McCain has not alleged that Simplot sells
more SIDEWINDERS™ products in Illinois than any other state. None of Simplot’s three
alleged infringing PEF systems are in Illinois, but two are in Idaho and the other is nearby in
North Dakota. Decl. of James Englar ¶ 3. The Court finds that the situs of material events is
Idaho, becuase nearly all of McCain’s claimed infringing activities of McCain’s two patents
predominantly took place there. See Anchor Wall, 55 F. Supp. 2d at 874. This factor supports
Third, Simplot claims that the case should be transferred to the District of Idaho because
the physical records and documents regarding SIDEWINDERS™ and Simplot’s PEF systems
are in Idaho. Most documents are presumed to be easily transportable, and do not weigh heavily
in favor of transfer. See Rabbit Tanaka Corp. USA v. Paradies Shops, Inc., 598 F. Supp. 2d 836,
840 (N. D. Ill. 2009) (“In this day and age, transferring documents from one district to another is
commonplace and, given the widespread use of digital imaging in big-case litigation, no more
costly than transferring them across town.”). Accordingly, this factor is neutral.
Fourth, is the convenience of witnesses, which is “often viewed as the most important
factor in the transfer balance.” Brandon Apparel, 42 F. Supp. 2d at 834 (quoting Rose v.
Franchetti, 713 F. Supp. 1203, 1214 (N.D. Ill. 1989)). Simplot has identified several employee
witnesses that reside in Idaho who could testify to the sales, marketing, design, and development
of SIDEWINDERS™, and others who would testify to the purchase and use of the claimed
infringing PEF systems. The Court gives less weight to the convenience of party witnesses,
because the Court presumes they will appear voluntarily at trial. See AL & PO Corp. v. Amer.
Healthcare Capital, Inc., No. 14 C 1905, 2015 WL 738694, at *4 (N.D. Ill. Feb. 19, 2015)
(“[T]he convenience of witnesses who are within a party’s control, such as a party’s employees,
is far less important than the convenience of non-party witnesses.”); Bullard v. Burlington N.
Santa Fe Ry. Co., No. 07 C 6883, 2008 WL 4104355, at *4 (N.D. Ill. Aug. 28, 2008) (“Courts
are less concerned about the burden that appearing at trial might impose on witnesses who are
either employees of parties or paid experts; it is presumed that such witnesses will appear
voluntarily.”). Simplot has identified three individual non-party witnesses who reside in the
District of Idaho. Michael L. Hamann and Bruce T. Pittard are inventors of Simplot’s “Spiral
Potato Piece” Patent and could testify as to the development of Simplot’s SIDEWINDERS™
product. Nick Speakman, an employee of Food Physics, could testify regarding the functionality
and operation of Simplot’s PEF systems. Additionally, Simplot worked with AceCo and JST
Manufacturing, two independent contractors located in Boise, to produce their
SIDEWINDERS™ product. Doc. 29 ¶ 9. McCain has not contested the necessity or value of
any of these parties in resolving its claims.
In contrast, McCain has identified two witnesses who would testify to the patents at issue
who live in Illinois, but both are employed by McCain. McCain argues that travelling to Boise is
more burdensome than travelling to Chicago for potential witnesses from Canada or Europe
because Chicago is a major airline hub, and there are unnamed witnesses who would testify to
Simplot’s counterclaims regarding the validity of its two patents. Presumably these witnesses
would be party witnesses, and McCain has not claimed otherwise, warranting less consideration.
See Bullard, 2008 WL 4104355, at *4 (giving less consideration to party witnesses when
weighing convenience of witnesses). Even if potential additional travel time for these witnesses
international witnesses was an inconvenience, McCain has identified no such witnesses and
instead only alludes to hypothetical ones. Considering the convenience for all potential
witnesses and the Court’s ability to subpoena them, giving priority to non-party witnesses, the
Court finds that this factor weighs in favor of transfer.
Fifth, in evaluating the convenience of the parties, the Court considers the parties’
residences and their ability to bear the expense of litigating in each forum. Brandon Apparel, 42
F. Supp. 2d at 834. A case should not be transferred, however, merely to shift the inconvenience
from one party to another. Sage Prods., Inc. v. Devon Indus., Inc., 148 F.R.D 213, 216 (N.D. Ill.
1993). Both parties are large companies, and will not be significantly burdened from having to
litigate in either district. Both parties have ongoing litigation in the District of Idaho regarding
Simplot’s “Spiral Potato Piece” Patent, U.S. Patent No. D640,036, (’036 Patent) which covers
Simplot’s SIDEWINDERS™ product. Doc. 26-1 ¶ 19. McCain argues that the products and
patents at issue in the pending Idaho litigation are not the same, and that there is no actual case or
controversy in that case. However, both cases involve a claim regarding each company’s patents
and production of a spiral shaped potato snack. Surely the parties would save some resources by
resolving these conflicts in the same forum. Therefore, this factor weighs slightly in favor of
Interest of Justice
“The ‘interest of justice’ is a separate element of the transfer analysis that relates to the
efficient administration of the court system.” Research Automation, Inc. v. Schrader–Bridgeport
Int’l, Inc., 626 F.3d 973, 978 (7th Cir. 2010). Courts consider factors such as the likelihood of a
speedy trial, each court’s familiarity with the applicable law, the desirability of resolving
controversies in each locale, the relationship of each community to the controversy, and the
possibility of consolidating related litigation. Id.; Coffey, 796 F.2d at 220–21. This analysis
does not relate to the merits of an underlying dispute. Coffey, 796 F.2d at 221.
First, patent infringement is a question of federal law, and both the District of Idaho and
this Court are equally capable of resolving this case. See Body Sci., 846 F. Supp. 2d at 998
(finding that the transferring court and any transferee court were equally equipped to handle
patent the infringement case). This factor is neutral.
Second, the average time between filing and disposition in the District of Idaho is 11.4
months versus 7.4 months in this district.4 McCain also raises that the District of Idaho is in a
year-long judicial emergency due to its shortage of judges. Judge David Nye was confirmed on
July 12th, 2017, and is expected to be sworn in by early August, thus easing some of the burden
on the judges in that district. It is reasonable to expect the disparity between the districts to
decrease with the appointment of an additional judge.
Simplot also argues that any resulting difference between the districts would be
counterbalanced by the consolidation of the parties’ ongoing litigation in the District of Idaho.
“[R]elated litigation should be transferred to a forum where consolidation is feasible.” Coffey,
796 F.2d at 221. McCain contends that Simplot’s claims against it in the District of Idaho are
meritless and that, by waiting to complete service until the last day in that case, Simplot is trying
to abuse the system. The Court will not pass judgment on the merits of another court’s ongoing
case, nor will it presume any foul play on the part of Simplot for complying with the rules of
service in the Federal Rules of Civil Procedure. Fed. R. Civ. P. 4(m). Furthermore, the cases
These figures come from the website of the United States Courts detailing federal court management
statistics as of December 2016. See http://www.uscourts.gov/sites/default/files/data_tables/
share common issues and questions of fact. Both involve the companies’ competing patents
regarding the design of their potato products. Requiring the same witnesses to appear in two
different forums to answer the same questions would be an inefficient use of judicial and party
time and resources. Transfer and potential consolidation also helps limit the risk of inconsistent
judgments. See Countryman v. Stein Roe & Farnham, 681 F. Supp. 479, 484 (N.D. Ill. 1987)
(finding in favor of transfer when related suits involved common questions of law and fact
despite not being identical claims).
“Where an accused product is distributed and sold throughout the United States, several
states share an interest in redressing the alleged infringement.” Body Sci., 846 F. Supp. 2d at 998
(internal citations omitted). However, the forum where the alleged infringing products were
researched, developed, tested, marketed, and sold has a greater interest than other forums where
the products were sold. Id. All of Simplot’s research, development, marketing, and sales
decisions of their SIDEWINDERS™ product took place in Idaho. The same is true regarding
their purchase and use of their PEF systems, save for one system that is located in North Dakota.
On the other hand, the Northern District of Illinois has an interest in preventing infringing goods
from being sold within its boundaries. But that interest is no greater than any other district where
goods are sold, and does not trump the District of Idaho’s significant interest in adjudicating the
dispute. As a whole, the interest of justice factors weigh in favor of transfer.
Combined, the interest of justice, the convenience to non-party witnesses, Idaho being the
situs of material events, and the parties’ related ongoing litigation in the District of Idaho warrant
transfer under § 1404(a).
Section 1406 Transfer
As discussed, in deciding to transfer the venue of this litigation, the Court presumes that
Simplot has waived objection to venue by answering that venue is proper. See Doc. 22 ¶ 7. But
even if Simplot had not answered that venue is proper, the Court would still order transfer of this
case to the District of Idaho, under 28 U.S.C. § 1406. The Supreme Court’s recent decision in
TC Heartland, which affirmed its own prior decision in Fourco Glass Co., held that domestic
corporations reside only in their state of incorporation, because § 1400(b) is the sole and
exclusive provision controlling venue in patent infringement actions and should not be
supplemented by § 1391(c). 137 S. Ct. at 1520; Fourco Glass Co. v. Transmirra Prods. Corp.,
353 U.S. 222, 229, 77 S. Ct. 787, 1 L. Ed. 2d 786 (1957). This overturned the Federal Circuit,
which in 1990 held that Fourco was no longer good law due to amendments to 28 U.S.C. § 1391.
VE Holding Corp. v. Johnson Gas Appliance Co., 917 F.2d 1574, 1584 (Fed. Cir. 1990).
TC Heartland’s holding means that venue is proper for McCain’s claims against Simplot
only if (1) Simplot is incorporated in Illinois, or (2) Simplot has committed acts of infringement
and has a regular and established place of business in the Northern District of Illinois. 28 U.S.C.
§ 1400(b). Simplot is not incorporated in Illinois, nor does it have facilities of any kind that
would constitute an established place of business. Simplot’s only contact with Illinois is through
the sale of its products, which, prior to VE Holding, the Seventh Circuit deemed insufficient for
venue under § 1400(b). Knapp-Monarch Co. v. Casco Prods. Corp., 342 F.2d 622, 625 (7th Cir.
1965). Therefore, Simplot is correct that if TC Heartland applies, venue would not be proper in
this District and a transfer would be appropriate under § 1406. United Financial Mortg. Corp. v.
Bayshores Funding Corp., 245 F. Supp. 2d 884, 888 (N.D. Ill. 2002) (noting that, under §
1406(a), on its own, a court may dismiss a case or it may transfer the case if it is in the interest of
justice). Here, though, Simplot potentially waived any objection to venue, but the Court need
not resolve that issue because transfer is proper under § 1404 if venue is proper and would be
proper under § 1406 if venue is not proper.
For the foregoing reasons, the Court grants Simplot’s motion to transfer venue . The
Clerk is directed to transfer this case to the District of Idaho.
Dated: August 9, 2017
SARA L. ELLIS
United States District Judge
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?