SkyHawke Technologies, LLC v. DECA International Corp.

Filing 150

Memorandum Opinion and Order denying 141 MOTION to Dismiss for Improper Venue, as set out herein. Signed by District Judge Tom S. Lee on 7/21/17 (LWE)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF MISSISSIPPI
NORTHERN DIVISION
SKYHAWKE TECHNOLOGIES, LLC
vs.

PLAINTIFF
CIVIL ACTION NO. 3:10cv708TSL-RHW

DECA INTERNATIONAL CORP. and
DECA SYSTEM, INC.

DEFENDANTS

MEMORANDUM OPINION AND ORDER
This cause is before the court on the motion of defendant
DECA International Corp. to dismiss for improper venue pursuant to
Federal Rule of Civil Procedure 12(b)(3).

Plaintiff Skyhawke

Technologies, LLC has responded in opposition to the motion.

The

court, having considered the memoranda of authorities submitted by
the parties, together with additional pertinent authorities,
concludes that defendants have waived their objection to improper
venue and that the motion to dismiss should therefore be denied.
DECA International moves to dismiss for improper venue based
on the United States Supreme Court’s May 22, 2017 decision in TC
Heartland LLC v. Kraft Foods Group Brands LLC, – U.S. –, 137 S.
Ct. 1514 (2017).

As explained in TC Heartland, venue in patent

cases is governed by 28 U.S.C. § 1400(b), which provides that
“[a]ny civil action for patent infringement may be brought in the
judicial district where the defendant resides, or where the
defendant has committed acts of infringement and has a regular and

established place of business.”

The Supreme Court earlier held in

Fourco Glass Co. v. Transmirra Products Corp., 353 U.S. 222, 77 S.
Ct. 787, 1 L. Ed. 2d 786 (1957), that for purposes of § 1400(b), a
domestic corporation “resides” only in its state of incorporation,
and in so holding, rejected the argument that § 1400(b)
incorporates the broader definition of “residence” in the general
venue statute, 28 U .S.C. § 1391(c).
1516 (citing Fourco).

TC Heartland, 137 S. Ct. at

Since the Court’s decision in Fourco,

Congress has amended the general venue statute to provide that
“[e]xcept as otherwise provided by law” and “[f]or all venue
purposes” a defendant corporation shall be deemed to reside in any
judicial district in which it is subject to personal jurisdiction.
The Court in TC Heartland concluded that the amendments to § 1391
“did not modify the meaning of § 1400(b) as interpreted in Fourco”
and reaffirmed that “a domestic corporation ‘resides’ only in its
State of incorporation for purposes of the patent venue statute.”
Id. at 1517.

In so holding, the court reversed the Federal

Circuit’s decision in VE Holding Corp. v. Johnson Gas Appliance
Co., 917 F.2d 1574 (1990), in which the Federal Circuit had held
that the 1988 amendment to § 1391(c) established the definition of
residence for purposes of § 1400(b).
1515.

2

TC Heartland, 137 S. Ct. at

In its motion to dismiss, DECA International contends that in
accordance with the Court’s holding in TC Heartland, venue is no
longer proper in this district under § 1400(b) since its state of
incorporation is California, and since it has no regular and
established place of business in Mississippi.

Skyhawke opposes

the motion, contending, among other things, that DECA
International has waived its objection to improper venue by
failing to raise an objection to venue in any responsive pleading
or by timely motion.

See Fed. R. Civ. P. 12(h)(1) (defendant

waives defense of improper venue by failing to make a timely
motion under Rule 12; by failing to object in a responsive
pleading; or by making a motion under Federal Rule of Civil
Procedure 12 without objecting to venue).

DECA International did

not raise an objection to improper venue in any responsive
pleading or by a Rule 12 motion.

On the contrary, evidently in

reliance on the Federal Circuit’s ruling in VE Holding, it
admitted venue was proper in this district.

Nevertheless, it now

contends that TC Heartland excuses its waiver because the Supreme
Court decision in TC Heartland effectively recognized a new
defense that was not previously available and consequently could
not have been raised.

The court is not persuaded.

By far, the majority of courts that have considered this same
argument have rejected it, finding that TC Heartland was not an

3

intervening change in the law and hence does not excuse a
defendant’s waiver of its defense of improper venue.1

These

authorities have addressed and rejected every argument DECA
International has made on this issue,2 and this court, having
considered these authorities, finds their reasoning and
conclusions sound.

See Cobalt Boats, LLC v. Sea Ray Boats, Inc.,

No. 2:15-CV-21, 2017 WL 2556679, at *3 (E.D. Va. June 7, 2017)
(“TC Heartland does not qualify for the intervening law exception
to waiver because it merely affirms the viability of Fourco.”);
Elbit Sys. Land & C4I Ltd. v. Hughes Network Sys., LLC, No.
2:15-cv-00037, 2017 WL 2651618, at *20 (E.D. Tex. June 20, 2017)
(“[T]he Supreme Court's decision in TC Heartland does not qualify
[as a change in law]” and does not exempt defendant for its waiver
of the venue defense); Chamberlain Group, Inc. v. Techtronic

1

Skyhawke contends the Fifth Circuit has not recognized
an exception to waiver based on an intervening change in the law.
The court need not consider this issue as it concludes there has
been no intervening change in the law.
2

DECA International makes one argument that these cases
may not have addressed, which is that Skyhawke has indicated its
intention to file an amended complaint, which will allow DECA
International to raise a venue defense. Skyhawke points out that
at this time, it has filed no such amended pleading so that this
issue is not ripe for decision at this time. It further points
out that even under the authorities cited by DECA International,
unless it files an amended pleading which greatly expands or
changes the factual allegations and/or scope of the case – which
it does not intend to do – the waived venue defense cannot be
revived.
4

Industries Co. et al., No. 1:16-cv-6097, at *3 (N.D. Ill. June 28,
2017) (“[T]he Court follows Elbit and Cobalt Boats ... in finding
that TC Heartland did not represent a change in the law that would
excuse waiver under these circumstances.”); iLife Techs. Inc. v.
Nintendo of America, Inc., No. 3:13-cv-4987, 2017 WL 2778006, at
*7 (N.D. Tex. June 27, 2017) (“TC Heartland does not qualify as an
intervening change in law.”); Amax, Inc. v. ACCO Brands Corp., No.
CV 16-10695-NMG, 2017 WL 2818986, at *2 (D. Mass. June 29, 2017)
(“[D]efendant's contention that an objection to improper venue
under 28 U.S.C. § 1400(b) was previously unavailable is
incorrect.”); Infogation Corp. v. HTC Corp., No. 16-CV-01902H-JLB, 2017 WL 2869717, at *4 (S.D. Cal. July 5, 2017) (“[T]he
Supreme Court's decision in TC Heartland does not excuse
Defendants' waiver as to venue in this District.”); Navico, Inc.
v. Garmin Int'l, Inc., No. 2:16-CV-190, 2017 WL 2957882, at *2
(E.D. Tex. July 11, 2017) (“[B]ecause TC Heartland does not
qualify as an intervening change of law, this waiver is not
excused.”); Reebok Intl Ltd., No. 3:16-CV-1618-SI, 2017 WL
3016034, at *4 (D. Or. July 14, 2017) (“The Court ... agrees with
the reasoning and analyses of the several district court cases
finding that TC Heartland does not serve as an intervening change
in the law negating Defendants' waiver of the defense of improper
venue”).

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Therefore, based on the foregoing, it is ordered that DECA
International’s motion to dismiss for improper venue is denied.3
SO ORDERED this 20th day of July, 2017.

/s/ Tom S. Lee
UNITED STATES DISTRICT JUDGE Rule

3

There is also pending a motion by defendant DECA System,
Inc. to dismiss for lack of personal jurisdiction. That motion
will be addressed by separate order.
6