B.E. Technology, L.L.C. v. Microsoft Corporation

Filing 53

ORDER denying 30 Motion to Transfer Venue. Signed by Chief Judge Jon Phipps McCalla on 7/16/13. (McCalla, Jon)

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF TENNESSEE

B.E. TECHNOLOGY, LLC,
Plaintiff,
v.
MICROSOFT CORPORATION,
Defendant.

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No.: 2:12-cv-02829-JPM-tmp

ORDER DENYING MOTION TO TRANSFER VENUE

Before the Court is Defendant Microsoft Corporation’s
(“Defendant” or “Microsoft”) Motion to Transfer Venue Pursuant
to 28 U.S.C. § 1404(a), filed January 18, 2013.

(ECF No. 30.)

For the reasons that follow, the Motion is DENIED.
I.

BACKGROUND
This case concerns Defendant Microsoft’s alleged

infringement of United States Patent No. 6,628,314 (the “‘314
patent”) and United States Patent No. 6,771,290 (the “‘290
patent”).

(ECF No. 1.)

Plaintiff B.E. Technology, LLC

(“Plaintiff or “B.E.”) is the assignee of both the ‘314 and ‘290
patents (ECF No. 38 at 2), currently owning “all right, title,
and interest throughout the period of the infringement” in the
respective patents (ECF No. 1 ¶¶ 13, 16).
B.E. alleges that Microsoft infringed the ‘314 patent “by
using a method of providing demographically targeted advertising

that directly infringes at least Claim 11 of the ‘314 patent
either literally or under the doctrine of equivalents.”
¶ 14.)

(Id.

Further, B.E. alleges that Microsoft infringed the ‘290

patent “by using, selling, and offering to sell in the United
States tablet computer products that directly infringe at least
Claim 2 of the ‘290 patent either literally or under the
doctrine of equivalents.”

(Id. ¶ 17.)

B.E. filed a Complaint in this Court on September 21, 2012.
(ECF No. 1.)

Microsoft filed its Answer to the Complaint on

December 31, 2012 (ECF No. 27), and its Motion to Transfer Venue
on January 18, 2013 (ECF No. 30).

B.E. filed its Memorandum in

Opposition to Defendant’s Motion to Transfer Venue on February
4, 2013.

(ECF No. 38.)

With leave of Court, Microsoft filed a

Reply Memorandum in Support of Its Motion to Transfer on
February 21, 2013.

(ECF No. 45.)

On February 8, 2013,

Microsoft filed a Motion to Stay pending resolution of its
Motion to Transfer Venue.

(ECF No. 40.)

The Court granted

Microsoft’s Motion to Stay on February 11, 2013.

(ECF No. 41.)

Microsoft seeks to transfer this case to the Western
District of Washington, or, in the alternative, to the Northern
District of California.

(ECF No. 30 at 1.)

To support its

Motion, Microsoft contends that “the vast majority of witnesses,
documents, and other physical evidence are expected to be
located in the Western District of Washington and the Northern
2

District of California, where Microsoft has operations relevant
to the accused products.”

(ECF No. 30-1 at 1.)

Further,

Microsoft asserts that “various third-party prior art witnesses
will be located in Northern California,” and “a number of the
engineers that worked on” Microsoft’s MSN Services and are
potential witnesses, but are no longer employed by Microsoft,
“may reside in the Western District of Washington.”

(Id. at 10

n.5.)
B.E. opposes Microsoft’s Motion to Transfer.
limited-liability company incorporated in Delaware.
¶ 2.)

B.E. is a
(ECF No. 1

B.E. was originally registered in Michigan, but formally

registered to conduct business in Tennessee in September 2012.
(ECF No. 38 at 2.)

B.E. contends that Memphis, Tennessee, is

its principal place of business.

(ECF No. 1 ¶ 2.)

Martin David

Hoyle (“Hoyle”), B.E.’s founder and CEO, is the named-inventor
of the ‘314 patent.

(ECF No. 38 at 1, 2.)

Hoyle asserts he has

been a resident of Tennessee since April, 2006.

(Id.)

B.E. argues that transfer is inappropriate because it has
substantial connections with this district.

B.E. argues that

Hoyle has been “present in this District since 2006, and B.E.
since at least 2008,” and that this district is B.E.’s principal
place of business.

(Id. at 5.)

B.E. also argues that its

corporate documents, including documents relating to the

3

“conception and reduction to practice” of the patent-in-suit,
are located in this District.

(Id. at 5.)

II. STANDARD
Microsoft moves the Court to transfer this case to the
Western District of Washington, or, alternatively, to the
Northern District of California, pursuant to 28 U.S.C. §
1404(a).

(ECF No. 30 at 1.)

The statute provides that “[f]or

the convenience of the 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.”
28 U.S.C. § 1404(a).

“As the permissive language of the

transfer statute suggests, district courts have ‘broad
discretion’ to determine when party ‘convenience’ or ‘the
interest of justice’ make a transfer appropriate.”

Reese v. CNH

Am. LLC, 574 F.3d 315, 320 (6th Cir. 2009).
In determining whether to transfer a case under § 1404(a),
the court must first determine whether the claim could have been
brought in the transferee district.

28 U.S.C. § 1404(a)

(allowing transfer to any other district in which the claim
“might have been brought”).

Once the court has made this

threshold determination, the court must then determine whether
party and witness “convenience” and “the interest of justice”
favor transfer to the proposed transferee district.

Reese, 574

F.3d at 320; Esperson v. Trugreen Ltd., No. 2:10-cv-02130-STA4

cgc, 2010 WL 4362794, at *5 (W.D. Tenn. Oct. 5, 2010), adopted
2010 WL 4337823 (W.D. Tenn. Oct. 27, 2010).

In weighing these

statutory factors, the court may still consider the private- and
public-interest factors set forth in the pre-Section 1404(a)
case, Gulf Oil v. Gilbert, 330 U.S. 501, 508-09 (1947), but
courts are not burdened with “preconceived limitations derived
from the forum non conveniens doctrine.”

Norwood v.

Kirkpatrick, 349 U.S. 29, 31 (1955) (quoting All States Freight
v. Modarelli, 196 F.2d 1010, 1011 (3d Cir. 1952)) (internal
quotation marks omitted); Esperson, 2010 WL 4362794, at *5.

The

United States Court of Appeals for the Sixth Circuit has stated
that when deciding “a motion to transfer under § 1404(a), a
district court should consider the private interests of the
parties, including their convenience and the convenience of
potential witnesses, as well as other public-interest concerns,
such as systemic integrity and fairness, which come under the
rubric of ‘interests of justice.’”

Moore v. Rohm & Haas Co.,

446 F.3d 643, 647 n.1 (6th Cir. 2006).
Additionally, the “interest of justice” factor has been
interpreted broadly by courts, influenced by the individualized
circumstances of each case.

The United States Court of Appeals

for the Federal Circuit has set forth a non-exhaustive list of
pertinent public-interest factors:

5

The
public
interest
factors
include
(1)
the
administrative
difficulties
flowing
from
court
congestion; (2) the local 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.
In re Acer Am. Corp., 626 F.3d 1252, 1254 (Fed. Cir. 2010); see
also In re Nintendo Co., Ltd., 589 F.3d 1194, 1198 (Fed. Cir.
2009) (finding the local-interest factor weighed heavily in
favor of transfer); Cincinnati Ins. Co. v. O’Leary Paint Co.,
676 F. Supp. 2d 623, 633 (W.D. Mich. 2009) (considering
additional factors such as the relative docket congestion of
each district).
Initially, B.E. argues that there is a strong presumption
in favor of its choice of forum, and its choice of forum should
not be disturbed unless the defendant carries its burden to
demonstrate that the balance of convenience strongly favors
transfer.

(ECF No. 30 at 4-6.)

B.E.’s argument is erroneously

derived from the more stringent forum-non-conveniens standard.
Compare Hunter Fan Co. v. Minka Lighting, Inc., No. 06–2108
M1/P, 2006 WL 1627746 (W.D. Tenn. June 12, 2006) (applying the
appropriate private- and public-interest factors but relying on
the forum-non-conveniens doctrine to accord strong deference to
the plaintiff’s choice of forum), with

OneStockDuq Holdings,

LLC v. Becton, Dickinson, & Co., No. 2:12–cv–03037–JPM–tmp, 2013
WL 1136726, at *3 (W.D. Tenn. Mar. 18, 2013), and Roberts
6

Metals, Inc. v. Florida Props. Mktg. Grp., Inc., 138 F.R.D. 89,
92-93 (N.D. Ohio 1991) (recognizing defendants need to make a
lesser showing to overcome plaintiff’s choice of forum under
§ 1404(a)), aff’d per curiam, 22 F.3d 1104 (6th Cir. 1994).
Although there is a strong presumption in favor of the
plaintiff’s choice of forum under the doctrine of forum non
conveniens, under § 1404(a), a plaintiff’s choice of forum may
be considered, but is entitled to less deference.

Discussing

the difference between the common-law doctrine of forum non
conveniens and the federal transfer-of-venue statute in Norwood,
the Supreme Court stated,
When Congress adopted § 1404(a), it intended to
do more than just codify the existing law on forum non
conveniens. . . . [W]e believe that Congress, by the
term “for the convenience of parties and witnesses, in
the interest of justice,” intended to permit courts to
grant
transfers
upon
a
lesser
showing
of
inconvenience.
This is not to say that the relevant
factors have changed or that the plaintiff’s choice of
forum is not to be considered, but only that the
discretion to be exercised is broader.
Norwood, 349 U.S. at 32; see also Lemon v. Druffel, 253 F.2d
680, 685 (6th Cir. 1958) (“The choice of the forum by the
petitioner is no longer as dominant a factor as it was prior to
the ruling in Norwood v. Kirkpatrick[.]”); Esperson, 2010 WL
4362794, at *5-6.
Defendant’s burden under § 1404(a) is to demonstrate that a
change of venue to the transferee district is warranted.

7

See

Eaton v. Meathe, No. 1:11-cv-178, 2011 WL 1898238, at *2 (W.D.
Mich. May 18, 2011); Amphion, Inc. v. Buckeye Elec. Co., 285 F.
Supp. 2d 943, 946 (E.D. Mich. 2003); Roberts Metals, Inc., 138
F.R.D. at 93.

“Merely shifting the inconvenience from one party

to another does not meet Defendant’s burden.”

McFadgon v. Fresh

Mkt., Inc., No. 05-2151-D/V, 2005 WL 3879037, at *2 (W.D. Tenn.
Oct. 21, 2005).

“[T]he movant must show that the forum to which

he desires to transfer the litigation is the more convenient one
vis a vis the Plaintiff’s initial choice.”

Roberts Metals,

Inc., 138 F.R.D. at 93 (quoting Mead Corp. v. Oscar J. Boldt
Constr. Co., 508 F. Supp. 193, 198 (S.D. Ohio 1981)) (internal
quotation marks omitted).

If the court determines that the

“balance between the plaintiff’s choice of forum and defendant’s
desired forum is even, the plaintiff’s choice of [forum] should
prevail.”

Stewart v. Am. Eagle Airlines, Inc., No. 3:10-00494,

2010 WL 4537039, at *2 (M.D. Tenn. Nov. 3, 2010).
III. ANALYSIS
Microsoft asserts that B.E. could have brought this action
in the Western District of Washington, or, alternatively, in the
(See ECF No. 30-1 at 7.)

Northern District of California.

B.E.

does not dispute the assertion that the case could have been
brought in the Northern District of California.
at 4.)

(See ECF No. 38

The Court agrees with the parties that B.E. could have

brought suit in the Northern District of California as personal
8

jurisdiction over Microsoft exists in that district.

The Court

also agrees with Microsoft that the case could have been brought
in the Western District of Washington for the same reason.
Therefore, the only issue remaining is whether the balance of
the statutory factors — the convenience to the witnesses, the
convenience to the parties, and the interest of justice — favors
transfer to the Western District of Washington.

The Court will

address each statutory factor separately and balance these
factors to determine whether transfer to the Western District of
Washington, or the Northern District of California, is proper
pursuant to § 1404(a).
A.

Convenience of the Witnesses

When asserting that a transferee district is more
convenient for witnesses, a party “must produce evidence
regarding the precise details of the inconvenience” of the forum
chosen by the plaintiff.

Esperson, 2010 WL 4362794, at *8.

To

satisfy its burden, the movant must do “more than simply
assert[] that another forum would be more appropriate for the
witnesses; he must show that the witnesses will not attend or
will be severely inconvenienced if the case proceeds in the
forum district.”
at 93).

Id. (quoting Roberts Metals, Inc., 138 F.R.D.

Further, “[t]o sustain a finding on [this factor] . . .

the party asserting witness inconvenience has the burden to
proffer, by affidavit or otherwise, sufficient details
9

respecting the witnesses and their potential testimony to enable
a court to assess the materiality of evidence and the degree of
inconvenience.”

Eaton, 2011 WL 1898238, at *3 (quoting Rinks v.

Hocking, 1:10-CV-1102, 2011 WL 691242, at *3 (W.D. Mich. Feb.
16, 2011)) (internal quotation marks omitted).

It is the

“materiality and importance of the testimony of prospective
witnesses, and not merely the number of witnesses,” that is
crucial to this inquiry.

Rinks, 2011 WL 691242, at *3.

Microsoft contends that witness convenience favors transfer
to the Western District of Washington or the Northern District
of California.

(ECF No. 30-1 at 4-5, 8-9, ECF No. 39 at 4-6.)

To support this contention, Microsoft asserts that a majority of
the witnesses on which it intends to rely are located in the
transferee district, or the alternative transferee district.
These witnesses include Microsoft’s employees in both districts
and at least five non-party witnesses related to prior art
likely located in the Northern District of California.

(ECF No.

30-1 at 4-5, 10 n.5; ECF No. 39 at 4-6.)
In response, B.E. does not affirmatively identify any
witnesses it may call.

As Hoyle is the inventor of the patent-

in-suit and a party, it is presumed his testimony will be
necessary and material to B.E.’s case.

B.E. states that Hoyle

is located in the Western District of Tennessee.
1.)
10

(ECF No. 38 at

Because the convenience of party and non-party witnesses is
given different weight, the Court will analyze the witnesses
separately.

See Azarm v. $1.00 Stores Servs., Inc., No. 3:08-

1220, 2009 WL 1588668, at *4 (M.D. Tenn. June 5, 2009) (“[T]he
convenience of potential non-party witnesses, who are not
subject to the control of the parties, is a particularly weighty
consideration, because it is generally presumed that party
witnesses will appear voluntarily in either jurisdiction, but
non-party witnesses, with no vested stake in the litigation, may
not.”).
1.

Party Witnesses

Microsoft argues that “the potential Microsoft witnesses in
this case who can provide testimony on the operation of the
numerous accused Microsoft products are located in the Western
District of Washington or the Northern District of California.”
(ECF No. 30-1 at 4-5.)

Specifically, Microsoft contends that

“[m]ost if not all of the core Microsoft employees who designed
and developed the accused Microsoft Surface and Microsoft Xbox
360 consoles, as well as those who designed and developed Xbox
Live, Apps Marketplace, Windows Store, Xbox Video, and Xbox
Games are based in the Western District of Washington.”
4 (citing Bailey Decl., ECF No. 31, ¶ 4).)

(Id. at

Microsoft also

contends that “[m]ost if not all of the core Microsoft employees
who designed and developed Microsoft Xbox Music are based in
11

Redmond, [Washington,] or Paris, France.”
Bailey Decl., ECF No. 31, ¶ 4).)

(Id. at 4 n.3 (citing

Additionally, Microsoft

contends that the employees who “designed and developed
Microsoft’s Bing Ads, Microsoft Advertising, and Windows Ads in
App are based in either the Western District of Washington, or
in the Northern District of California.”
Decl., ECF No. 31, ¶¶ 5-6).)

(Id. (citing Bailey

Regarding its facilities in the

Northern District of California, Microsoft asserts that there
are “more than 1000 employees” located there, with “more than
100” who “work on Bing Ads, Microsoft Advertising or Windows Ads
in App.”

(Id. (citing Bailey Decl., ECF No. 31, ¶¶ 5-6).)

In

its Reply, Microsoft defends its general identification of
potential employee-witnesses by stating that identifying its
witnesses with more specificity at this early stage in the
litigation would be “unduly burdensome” and “contrary to
‘Congress’ intent to prevent the waste of time, energy and money
and to protect litigants, witnesses and the public against
unnecessary inconvenience and expense.’”

(ECF No. 45 at 5-6

(quoting In re EMC Corp., Misc. No. 142, 2013 WL 324154, at *2
(Fed. Cir. Jan. 29, 2013)).)
Microsoft notes generally that travel to the transferor
district would impose an inconvenience for its witnesses, but
does not provide any evidence showing that its employees will be
unwilling to testify in the Western District of Tennessee if
12

asked to do so.

(ECF No. 30-1 at 10.)

Further, Microsoft only

states generally that the absence of these potential employeewitnesses from Microsoft’s offices would adversely affect its
operations.

(See id. at 10); see also Esperson, 2010 WL

4362794, at *8.

Courts have noted that “normally a corporation

is able to make its employees available to testify when needed.”
Clark v. Dollar Gen. Corp., No. 3-00-0729, 2001 U.S. Dist. LEXIS
25975, at *9 (M.D. Tenn. Mar. 6, 2001); see also Zimmer Enters.
v. Atlandia Imps., Inc., 478 F. Supp. 2d 983, 991 (S.D. Ohio
Mar. 14, 2007) (finding that the convenience of witnesses who
are employees “will not ordinarily be considered, or at least,
that the convenience of such employees will not generally be
given the same consideration as is given to other witnesses”).
Accordingly, it appears that Microsoft’s employees will be able
to attend absent any evidence to the contrary.
Therefore, regarding Microsoft employees, Microsoft does
not satisfy its burden.

Microsoft argues that the burden of

proceeding in either proposed transferee district is reduced
when comparing its own employee witnesses to B.E.’s one likely
witness, Hoyle.

(ECF No. 30-1 at 9.)

The Court finds that this

only shifts the burden of inconvenience from one party to
another.

In the instant case, the Court agrees that Microsoft’s

employees related to the development and operation of the
accused products are located in both proposed transferee
13

districts, and that their testimony is likely material.
Microsoft, however, has only provided a general statement about
the necessity of those employees to its business and has not
indicated how many employees it would be inclined to call as
potential witnesses.

As a result, the Court cannot assess the

degree to which Microsoft’s business would be disrupted compared
to the disruption B.E. will endure due to its CEO’s absence
should the case be transferred.

Accordingly, the Court finds

transfer would only shift the inconvenience to B.E.

See

McFadgon, 2005 WL 3879037, at *2.
Therefore, because § 1404(a) provides for transfer “to a
more convenient forum, not to a forum likely to prove equally
convenient or inconvenient,” distance of travel for employee
witnesses does not weigh in favor of transfer.

Hunter Fan, 2006

WL 1627746, at *2 (citing Van Dusen v. Barrack, 376 U.S. 612,
645-46 (1964)).
Microsoft further argues that this factor strongly favors
transfer because its employees are located in both proposed
transferee districts, whereas B.E. has only one likely witness,
Hoyle, who is also an interested party.

(ECF No. 30-1 at 9-10.)

Microsoft asserts that “[t]he convenience of one party witness
does not justify the inconvenience, cost and business disruption
that would be imposed upon all other witnesses from Microsoft
and third parties.”

(Id. at 10.)
14

Although Microsoft does not

specifically list its witnesses, and though its assertion is
imprecise as to the materiality of the witnesses’ testimony, it
is not asserted that their testimony will not be relevant and
material in this case.

Microsoft’s general statement, however,

that it believes its employees in both California and Washington
are material does not aid the court in assessing (1) what the
testimony of such additional material witnesses will be; (2)
whether such witnesses will be unable to attend; or (3) whether
and to what extent such witnesses will be inconvenienced by
testifying in this district.
Microsoft relies on a United States District Court for the
Eastern District of Virginia case, Koh v. Microtek
International, Inc., 250 F. Supp. 2d 627 (E.D. Va. 2003), for
the proposition that although a motion to transfer must normally
contain specifics as to the “names, titles and locations of
witnesses and the content of their testimony” (ECF No. 45 at 5
(quoting ECF No. 38 at 9)), district courts can infer witnesses
are located near the infringing activities and “that witnesses
involved in
material.”

design and manufacture of the accused products are
(ECF No. 45 at 5 (quoting Koh, 250 F. Supp. 2d at

636-37) (internal quotation marks omitted).)

Recognizing that

Koh is persuasive authority, the Court also notes that Microsoft
misapplies it to the facts of the instant case.

In Koh, the

court stated, “although the Movants have not set out
15

specifically any potential testimony, they have identified one
individual who is located in California and two entities located
in California, which participated in conception and reduction to
practice of the accused product.”

Koh, 250 F. Supp. 2d at 637.

In the instant case, Microsoft has not identified specific
witnesses that “participated in [the] conception and reduction
to practice of the accused products.”

To the contrary,

Microsoft has only generally asserted that “most, if not all” of
its employees working on the accused products are located in
either proposed transferee district.
¶¶ 4-5.)

(Bailey Decl., ECF No. 31,

Microsoft further notes that it has “more than 100

employees” in the Northern District of California working on
some of the accused products.

(Id. ¶ 5.)

These generalizations

do not assist the Court in determining how many employeewitnesses Microsoft will actually seek to call, or whether the
Western District Washington or the Northern District of
California would be the more convenient forum for those
potential witnesses.

Microsoft cannot rely on such “bare

allegations” to satisfy its burden.

Esperson, 2010 WL 4362794,

at *8.
While B.E. did not specifically identify any witnesses, it
is presumed that Hoyle, as CEO and inventor of the patent-insuit, will be a key witness.

B.E., however, does not have the

burden to identify more witnesses for the purposes of this
16

Motion.

Despite B.E. not identifying any individuals,

Microsoft’s general identification of material witnesses who are
Microsoft employees does not satisfy its burden on this factor.
A simple numerical advantage is insufficient on the issues
raised by a motion to transfer.
Moreover, B.E. argues that “[i]t is likely that Microsoft’s
California-based employees will be deposed in California where
B.E.’s lead counsel is based.”

(ECF No. 38 at 11.)

This

further indicates that the witness-convenience factor does not
weigh in favor of transfer.

See Hunter Fan, 2006 WL 1627746, at

*2 (finding relevant that the plaintiff planned to take
depositions of the defendant’s witnesses in California in
determining that the witness convenience factor did not favor
transfer).
2.

Non-Party Witnesses

While convenience to party witnesses is an important
consideration, “it is the convenience of non-party witnesses,
rather than employee witnesses . . . that is the more important
factor and is accorded greater weight.”

Steelcase Inc. v. Smart

Techs., 336 F. Supp. 2d 714, 721 (W.D. Mich. Mar. 5, 2004)
(citation omitted) (internal quotation marks omitted).
Microsoft argues that “a number of third-party prior art
witnesses may be called upon to testify in this matter.”

(ECF

No. 30-1 at 10.) Microsoft states that it intends to rely on at
17

least five non-party witnesses who have knowledge of prior art
related to the patent-in-suit, all of whom are likely located in
the Northern District of California, as well as witnesses from
other internet advertising companies located in California.
(Id. at 10-11 & n.5.)

Microsoft also asserts that it may seek

to call former Microsoft engineers involved with MSN services,
which it contends is prior art, potentially located in the
Western District of Washington.

(Id. at 10 n.5.)

To support

its contention, Microsoft submits information from a LexisNexis
public information search for six prior-art witnesses,
indicating their last-known addresses.
ECF No. 45-1).)

(ECF No. 45 at 7 (citing

Microsoft claims that it will not be able to

compel these witnesses to testify at trial if the case remains
in Tennessee, but will be able to compel the California witness
to testify at trial in the Northern District of California, or
compel the Washington witnesses if the case is transferred to
the Western District of Washington.

(ECF No. 30-1 at 10-11; ECF

No. 45 at 6-7.)
B.E. argues that the convenience of third-party witnesses
is not entitled to great weight in the instant case because
Microsoft has not established that the “third party testimony
will be material or important.”

(ECF No. 38 at 11-12.)

B.E.

further argues that prior-art testimony is “almost certain to be

18

severely limited at the time of trial” and, therefore, such
testimony does not weigh in favor of transfer.

(Id. at 12.)

B.E. acknowledges that Microsoft has identified specific
third-party witnesses located in the Northern District of
California regarding prior art and that those witnesses would be
subject to its subpoena power, but states that, as Microsoft has
requested the case be transferred to the Western District of
Washington, “California-based third-parties equally are no more
subject to compulsory process in Washington than they are in
(Id. at 13.)

Tennessee.”

B.E. notes that Microsoft concedes

that it will be able to subpoena these potential third-party
witnesses for testimony or document production in their home
districts.

(Id.)

Further, B.E. argues that Microsoft “does not

address the relevance, materiality, and importance of the
testimony any witness who allegedly could not be subpoenaed
might give.”

(Id.)

The availability of compulsory process for unwilling
witnesses is a consideration closely related to the convenienceof-witnesses factor and the costs of procuring the witness, and
therefore is an important consideration for the Court.

See,

e.g., In re Acer, 626 F.3d at 1255; Rinks, 2011 WL 691242, at
*4.

Whether this factor should be given considerable weight

depends on the materiality of the testimony to the resolution of
the case.

Rinks, 2011 WL 691242, at *4.
19

A federal court in the

Northern District of California would be able to compel the
majority of the identified prior-art witnesses to testify at
trial.

See Fed. R. Civ. P. 45(b)(2).

In contrast, the majority

of the prior-art witnesses would not be subject to the subpoena
power in this district or the Western District of Washington,
see Fed. R. Civ. P 45(c)(3)(A)(ii), but would be available for
deposition in the Northern District of California if unwilling
to testify in this District.

Therefore, the testimony of such

witnesses potentially would “not be live and therefore could be
less persuasive.”

Rinks, 2011 WL 691242, at *4.

The Court finds that Microsoft has met its burden to show
the nature of the third-party witnesses testimony, and that the
testimony is likely material to Microsoft’s invalidity and noninfringement contentions.

To the extent the non-party

witnesses’ testimony may be presented by deposition, witness
inconvenience would not be an issue.

While Microsoft sets forth

the fact that the prior-art witnesses would not be subject to
subpoena in the Western District of Tennessee, the Court
recognizes that the same is true if the case is transferred to
the Western District of Washington – the district in which
Microsoft primarily seeks transfer.

Microsoft’s general

statement is not sufficient to allow the Court to determine
whether live testimony of Microsoft’s non-party witnesses is
necessary.

As a result, this factor weighs only slightly in
20

favor of transfer to the Northern District of California, and
does not weigh in favor of transfer to the Western District of
Washington.
B.

Convenience of the Parties

Microsoft argues that the convenience of the parties
requires the Court transfer this action to the Western District
of Washington, or, alternatively, to the Northern District of
California.

(ECF No. 30-1 at 1.)

While Microsoft organizes its

arguments somewhat differently than the Court, the Court finds
the considerations relevant to the convenience-of-the-parties
factor are the location of the sources of proof and the parties’
financial hardships due to litigation in the chosen forum.
1.

Location of Sources of Proof

Microsoft argues that “most if not all relevant Microsoft
documents and electronic files concerning the design and
development of the accused Microsoft products are maintained or
primarily accessible from Microsoft’s offices in the Western
District of Washington or the Northern District of California.”
(ECF No. 30-1 at 5.)

More specifically, Microsoft contends that

the documents, source code, and files relating to “Microsoft’s
Surface, Xbox 360 consoles, Xbox Live, Xbox Music, Apps
Marketplace, Windows Store, Xbox Video, and Xbox Games” are
located or “are accessible from Microsoft’s Western District of
Washington offices” (Bailey Decl., ECF No. 31, ¶ 4); and that
21

the documents, source code, and files relating to “Microsoft’s
Bing Ads, Microsoft Advertising, and Windows Ads in App” are
located or “accessible from Microsoft’s offices in the Western
District of Washington or the Northern District of California.”
(Id. ¶ 6.)

Microsoft argues that, while B.E. may have documents

in the transferor district, it is likely that B.E. has already
produced its relevant documents and the quantity of any
documents in B.E.’s possession does not “compare to the volume
of documents congregated on the west coast.”
8-9.)

(ECF No. 30-1 at

As a result, “the burden on Microsoft” to produce these

documents would not be present if the case is transferred.
(Id.)
B.E. argues that, because its CEO resides in the Western
District of Tennessee, its corporate documents and records,
“including documents demonstrating the conception and reduction
to practice of [the patents-in-suit],” are located in the
Western District of Tennessee.

(ECF No. 38 at 5, 14.)

B.E.

notes that while Microsoft’s sources of proof are located in
both proposed transferee districts, B.E.’s own sources of proof
are located in Tennessee and have been maintained there for
years.

(Id. at 14.)

B.E. also contends that “the location of

relevant documentary evidence is increasingly less important in
deciding motions to transfer,” and that because documents can be
exchanged electronically, the weight given this factor should be
22

minimal.

(Id.)

B.E. finally argues that this factor does not

weigh in favor of transfer because “it can be expected that
Microsoft will eventually produce its documents to B.E.’s lead
counsel in California, not to B.E. in Tennessee.”

(Id. at 15.)

As an initial matter, the Court disagrees with B.E.’s
contention that advances in electronic document transfer reduce
the importance of the location-of-sources-of-proof factor.

This

notion has been expressly rejected by the Federal Circuit.

See,

e.g., In re Link_A_Media Devices Corp., 662 F.3d 1221, 1224
(Fed. Cir. 2011) (reversing a district court that did not
consider the factor, stating, “While advances in technology may
alter the weight given to these factors, it is improper to
ignore them entirely”); In re Genentech, 566 F.3d at 1345-46
(finding clear error where a district court “minimized the
inconvenience of requiring the petitioners to transport their
documents by noting that ‘[t]he notion that the physical
location of some relevant documents should play a substantial
role in the venue analysis is somewhat antiquated in the era of
electronic storage and transmission’” (quoting Sanofi-Aentis
Deutschland GmbH v. Genentech, Inc., 607 F. Supp. 2d 769, 777
(E.D. Tex. 2009))).
The Court agrees that it is likely that the sheer volume of
documents Microsoft has in its possession outnumbers the patentrelated documents in B.E.’s possession, but the Court disagrees
23

that this is enough to tip the balance in favor of transfer.
The Court finds that both parties maintain some documents in
their respective districts, with Microsoft likely maintaining
material documents in both proposed transferee districts; that
both sets of documents will be integral to the proceedings; and
that Microsoft will be expected to serve its documents to B.E.’s
counsel in Northern California, not in the Western District of
Tennessee.

Microsoft’s reliance on In re Genentech is

misplaced.

(See ECF No. 30-1 at 8.)

In In re Genentech, the

court found that transfer was appropriate because all of the
movants’ relevant documents were located in the transferee
district or within that district’s subpoena power, while there
were no relevant documents in the transferor district.
re Genentech, 566 F.3d at 1345-46.

See In

In the instant case,

Microsoft indicated that some of its relevant documents will be
located outside the transferee district whether the Court grants
transfer to Washington or to California – and thereby outside
the subpoena power of one of the two districts, and B.E. has
shown that relevant documents are located in Tennessee.

Taken

together, the aforementioned facts indicate that as to the
location of the sources of proof, either transferee district may
only be a somewhat more convenient venue for the parties to the
instant case.

This factor, however, is not sufficient, by

itself, to require transfer.
24

2.

Financial Hardships Attendant to Litigating in
the Chosen Forum

Microsoft argues that all its potential witnesses are
located in the two proposed transferee districts and not in the
Western District of Tennessee.

(ECF No. 30-1 at 7-10.)

As a

result, Microsoft contends that travel to Tennessee and the
attendant costs would be a great inconvenience.

(Id. at 10.)

Microsoft argues that this burden “would not be incurred if the
case were to proceed in the Western District of Washington or
the Northern District of California.”

(Id. at 8.)

B.E. states that it “would face a financial burden by
having to litigate in the Northern District of California.”
(ECF No. 38 at 15.)

B.E.’s CEO Hoyle states that “B.E. will

incur expenses it will not incur if the case remains in
Memphis.”

(Hoyle Decl., ECF No. 38-1, ¶ 9.)

B.E. also states

that “[i]t is reasonable to require companies with the wealth
and size of Microsoft to litigate in jurisdictions in which they
regularly conduct business.”

(ECF No. 38 at 8.)

Further, B.E.

notes that Microsoft “does not contend that is it financially
incapable of bearing the expense of litigation in the Western
District of Tennessee.”

(Id. at 15.)

The Court has considered “the relative ability of litigants
to bear expenses in any particular forum” among the factors in a
§ 1404(a) case.

Ellipsis, Inc. v. Colorworks, Inc., 329 F.

25

Supp. 2d 962, 970 (W.D. Tenn. 2004).

In the instant case,

B.E.’s CEO stated that the company will incur additional
expenses, but it has not shown with any specificity how
detrimental those expenses would be to the company.

Further,

while Hoyle stated that his personal financial status would be
adversely affected by litigating in the either proposed
transferee district, he did not state why or how his personal
finances would impact B.E., the party to the instant case.
Hoyle Decl., ECF No. 38-1, ¶ 9.)

(See

B.E. has shown that Microsoft

has the ability to bear expenses in this forum (see ECF No. 383), but the Court does not find this to be a dispositive factor
in denying Microsoft’s Motion.

But see Siteworks Solutions, LLC

v. Oracle Corp., No. 08-2130-A/P, 2008 WL 4415075, at *4 (W.D.
Tenn. Sept. 22, 2008) (finding the relative financial strengths
of the parties did not weigh in favor of transferring the case,
as the party opposed to transfer showed it “ha[d] no net worth,
very little revenue, no gross profits, no assets, and [would
have to] borrow from its owners in order to pay the litigation
expenses”).

The Court finds that the evidence presented is

insufficient to make a showing that B.E. or Microsoft will be
adversely affected by litigating in any of the proposed forums.
The paramount consideration remains whether the Western District
of Washington, or the Northern District of California, is more
convenient to the parties than B.E.’s chosen forum.
26

With respect to convenience, the Court finds this factor
does not weigh in favor of transfer.

While Microsoft has made a

showing that costs would be reduced for its potential witnesses
if the case were transferred, it has not made a showing that its
business would be disrupted in an appreciable manner should the
case remain in the Western District of Tennessee.

Additionally,

B.E. has made a showing that its business would be disrupted in
having to prosecute the instant case in either proposed
transferee district.

Microsoft has shown that the proposed

transferee districts are more convenient forums for it, but it
has not shown that either district is a more convenient forum
for both parties.

As a result, the hardship to Microsoft does

not indicate transfer is more convenient.
C.

Interests of Justice

Microsoft argues that transfer to the Western District of
Washington or Northern District of California is appropriate
based on additional considerations that pertain to the
interests-of-justice factor.
at 9-10.)

(ECF No. 30-1 at 11-15; ECF No. 45

These considerations include the “public-interest

concerns, such as systemic integrity and fairness,” of the
proceedings.

See Moore, 446 F.3d at 647 n.1.

In the instant

case, the Court will consider the relative trial efficiency of
the transferee and transferor districts and the localized
interest in the litigation.
27

1.

Trial Efficiency

Microsoft argues that this factor weighs in favor of
transfer to either proposed transferee district.

Microsoft

contends that “the median time from filing to the beginning of
trial on the merits is 19.8 months in the Western District of
Washington, compared to 20.7 months in the Western District of
Tennessee.”

(ECF No. 30-1 at 12 (citing ECF No. 32-19 and ECF

No. 32-20).)

Further, Microsoft argues that the median time

from the filing of a case to the final disposition in both
proposed transferee districts is shorter than in the transferor
district.

(Id. (citing ECF No. 32-21).)

Responding to B.E.’s

claim that transferring the instant case would delay trial,
Microsoft notes that the claim is “not necessarily supported by
[B.E.’s] own statistics.”

(ECF No. 45 at 10.)

B.E. argues that transfer to the Northern District of
California “would likely delay trial of this case by at least
one year while transfer to the Western District of Washington
would have a less drastic impact on scheduling but would result
in a delay nonetheless.”

(ECF No. 38 at 16.)

B.E. cites 2012

statistics for the Northern District of California and the
Western District of Tennessee to illustrate that the median time
from filing to trial in the Northern District of California was
32.7 months, while the median time from filing to trial in the
Western District of Tennessee was 18.8 months.
28

(Id. (citing ECF

No. 38-4).)

B.E. cites similar statistics for the Western

District of Washington, noting that the median time from filing
to trial was 21.6 months.

(Id.)

Reviewing the statistics and the parties’ arguments, the
Court finds this factor neutral to its determination of whether
the Northern District of California or the Western District of
Washington is the more convenient forum.
2.

Local Interest

Microsoft argues that “the Western District of Washington’s
local interest in this controversy is ‘strong because the cause
of action calls into question the work and reputation of several
individuals residing in or near that district and who presumably
conduct business in that community.’”

(ECF No. 30-1 at 11

(quoting In re Hoffman-LaRoche, 587 F.3d 1333, 1336 (Fed. Cir.
2009)).)

Microsoft asserts that the local interest in the

Northern District of California is strong for the same reasons.
Finally, Microsoft argues that B.E.’s ties to the Western

(Id.)

District of Tennessee should be discounted because it
manufactured those ties in anticipation of litigation.

(Id. at

13-14.)
B.E. argues that the Western District of Tennessee has a
substantial local interest in the instant case because the
holder of the patent-in-suit is located here.
17.)

(ECF No. 38 at

B.E. also asserts that its ties to Tennessee are not
29

“recent, ephemeral, or manufactured for the purposes of
litigation.”

(Id.)

Hoyle stated that he has resided in the

Western District of Tennessee since 2006, that Memphis is B.E’s
principal place of business, and that the sources of proof
pertinent to the instant case are located in the District.
(Hoyle Decl., ECF No. 38-1, ¶¶ 2-4, 7-8.)
The Court finds that this factor does not weigh in favor of
transfer.

While Microsoft has strong local ties to the Western

District of Washington and the Northern District of California,
the Court finds that B.E. has strong ties to the Western
District of Tennessee and its connections to the District were
not manufactured for the purposes of litigation.

B.E.’s founder

and CEO, who is also the holder of the patent-in-suit, has
resided in the district for seven years.

B.E.’s connections,

therefore, are neither “recent” nor “ephemeral.”

As a result,

Microsoft has not demonstrated that either transferee districts’
local interest outweighs that of the Western District of
Tennessee.
IV.

CONCLUSION
For the foregoing reasons, the Court finds that, in

balancing the statutory factors, Microsoft has not demonstrated
that the Western District of Washington or the Northern District
of California is a more convenient forum than the Western

30

District of Tennessee.

Therefore, Microsoft’s Motion to

Transfer Venue is DENIED.
Accordingly, the Court hereby LIFTS the February 11, 2013,
stay of all proceedings.

(ECF No. 41.)

Regarding B.E.’s Motion

to Dismiss and Motion to Strike, filed January 25, 2013 (ECF No.
34), Microsoft shall have fourteen (14) days from the date of
entry of this Order, up to and including July 30, 2013, to file
its Responses to B.E’s Motions.
IT IS SO ORDERED this 16th day of July, 2013.

/s/ Jon P. McCalla_______
CHIEF U.S. DISTRICT JUDGE

31