Navico, Inc. et al v. Garmin International, Inc. et al
MEMORANDUM AND OPINION and ORDER denying 132 MOTION to Dismiss for Improper Venue, or Alternatively to Transfer Venue to the District of Kansas Pursuant to 28 U.S.C. § 1406 filed by Garmin USA, Inc., Garmin International, Inc. Signed by Judge Rodney Gilstrap on 7/11/2017. (slo, )
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF TEXAS
NAVICO, INC. and NAVICO HOLDING
GARMIN INTERNATIONAL, INC. and
GARMIN USA, INC.
Civil Action No. 2:16-CV-190
MEMORANDUM OPINION AND ORDER
Before the Court is Defendants’ Motion to Dismiss for Improper Venue, or Alternatively
to Transfer Venue to the District of Kansas Pursuant to 28 U.S.C. § 1406 (Dkt. No. 132) (“the
Motion”). Having considered the Parties’ arguments, the Court DENIES the Motion.
Plaintiffs Navico, Inc. and Navico Holding AS (collectively “Navico”) filed the instant suit
against Defendants Garmin International, Inc. and Garmin USA, Inc. (collectively “Garmin”) on
March 4, 2016 alleging infringement of U.S. Patent No. 9,223,022 (“the ’022 Patent”) and U.S.
Patent No. 9,244,168 (“the ’168 Patent”). (Dkt. No. 1.) Garmin filed its Answer to Plaintiffs’
Complaint, in which it admitted that venue was proper in the Eastern District of Texas, on April
1, 2016. (Dkt. No. 8 at ¶ 12 (“Garmin admits that venue is proper in this judicial district . . . .”).)
Plaintiffs filed an Amended Complaint on November 18, 2016. (Dkt. No. 50.) Garmin
then filed an Answer to this Amended Complaint, in which it again admitted that venue was proper
in the Eastern District of Texas, on December 2, 2016. (Dkt. No. 51 at ¶ 12.)
After Garmin admitted, for the second time, that venue was proper in the Eastern District
of Texas, the case proceeded through claim construction, (Dkt. Nos. 55, 57, 68), as well as
substantial motion practice. However, on June 21, 2017, Garmin filed the instant Motion seeking
to dismiss this case for improper venue under Federal Rule of Civil Procedure 12(b)(3) or, in the
alternative, to transfer it to the District of Kansas pursuant to § 1406. (Dkt. No. 132.)
A. Applicable Law
Generally, the Court of Appeals for the Federal Circuit applies “the law of the regional circuit
to the procedural question of waiver.” Riverwood Int’l Corp. v. R.A. Jones & Co., 324 F.3d 1346,
1352 (Fed. Cir. 2003); Ultra-Precision Mfg., Ltd. v. Ford Motor Co., 411 F.3d 1369, 1376 (Fed.
Cir. 2005) (“Regional circuit law governs the question of waiver of a defense.”). However, the
Federal Circuit has applied its own law in certain cases where the underlying argument found to
have been waived was unique to patent law. See, e.g., Rates Tech. Inc. v. Nortel Networks Corp.,
399 F.3d 1302, 1307 (Fed. Cir. 2005) (applying Federal Circuit law in assessing whether
objections to personal jurisdiction were waived). In Harris Corp. v. Ericsson Inc., 417 F.3d 1241
(Fed. Cir. 2005), for example, now-Chief Judge Prost explained this approach in the context of
deciding whether a claim construction argument had been waived:
Waiver is a procedural issue, but if one views the issue more narrowly as ‘waiver
of a claim construction argument,’ rather than the more general ‘waiver of an
appellate argument,’ it seems indisputably unique to patent law. In our estimation,
the narrower of these two views is more appropriate.
417 F.3d at 1250. In light of Rates Tech. and Harris, the Court is persuaded that the appropriate
view of the issue here is whether Defendants have waived their objections to venue based on
§ 1400(b). Any determination of venue in light of § 1400(b) is necessarily unique to patent law
because the statute itself is unique to patent law. 28 U.S.C. § 1400(b) (“Any civil action for patent
infringement . . . .”). See also TC Heartland LLC v. Kraft Foods Grp. Brands LLC, 137 S. Ct.
1514, 1519 (2017) (holding that § 1400(b) “‘is the sole and exclusive provision controlling venue
in patent infringement actions.’” (quoting Fourco Glass Co. v. Transmirra Products Corp., 353
U.S. 222, 229 (1957))). Therefore, Federal Circuit law should control whether an objection to
venue based on § 1400(b) has been waived. But see Cobalt Boats, LLC v. Sea Ray Boats, Inc.,
No. 2:15CV21, 2017 WL 2556679, at *2 (E.D. Va. June 7, 2017) (Fourth Circuit law applies
because waiver is not unique to patent law); Infogation Corp. v. HTC Corp., No. 16-CV-01902H-JLB, 2017 WL 2869717, at *2 (S.D. Cal. July 5, 2017) (discussing Ninth Circuit law, but not
addressing the question of whether Ninth Circuit law controls). Notwithstanding the above,
applying either Fifth Circuit or Federal Circuit law compels the conclusion that Garmin has waived
its objection to venue. See Neirbo Co. v. Bethlehem Shipbuilding Corp., 308 U.S. 165, 167–68
(1939) (concluding that the right to object to venue can be waived “by failure to assert it
seasonably, by formal submission in a cause, or by submission through conduct”).
B. Applicable Standard
Under Federal Rule of Civil Procedure 12(h)(1), a defendant may waive the affirmative
defense of improper venue under three circumstances. Fed. R. Civ. P. 12(h)(1); Biomedical Patent
Mgmt. Corp. v. California, Dep’t of Health Servs., 505 F.3d 1328, 1340 (Fed. Cir. 2007)
([V]enue . . . is, of course, a waivable defense.”). First, an objection to venue may be waived by
failing to make a motion under Federal Rule of Civil Procedure 12. Fed. R. Civ. P. 12(h)(1)(B)(i).
Second, it may be waived by failing to object “in a responsive pleading or in an amendment
allowed by Rule 15(a)(1) as a matter of course.” Fed. R. Civ. P. 12(h)(1)(B)(ii). Finally, it may
be waived by making a motion under Federal Rule of Civil Procedure 12 without also objecting to
venue. Fed. R. Civ. P. 12(h)(1)(A); Fed. R. Civ. P. 12(g)(2) (“Except as provided in Rule 12(h)(2)
or (3), a party that makes a motion under this rule must not make another motion under this rule
raising a defense or objection that was available to the party but omitted from its earlier motion.”).
Courts have also found that a defendant may waive an objection to venue by litigating a case
without contesting venue. See, e.g., Infogation, No. 16-CV-01902-H-JLB, 2017 WL 2869717, at
*3 (finding waiver where a defendant “litigated the consolidated action . . . for approximately a
contentions . . . and
construction . . . .”). This follows from the general rule that an affirmative defense, such as an
objection to venue, may be waived “by actively litigating [a] suit.” United States v. Ziegler Bolt
& Parts Co., 111 F.3d 878, 882 (Fed. Cir. 1997) (“A defendant may waive such affirmative
defenses by actively litigating the suit, even where the defenses are properly included in the
Plaintiffs argue that Garmin “unquestionably waived the venue argument it now presents”
because Defendants admitted twice (and at separate times) that venue was proper in the Eastern
District of Texas and failed to contest venue until two months before trial. (Dkt. No. 160 at 3–4.)
The Court agrees with Plaintiffs. Defendants litigated this case through claim construction and
engaged in substantial motion practice without objecting to venue. Numerous courts, even after
TC Heartland, have held that this type of conduct constitutes waiver. See, e.g., Infogation, No.
16-CV-01902-H-JLB, 2017 WL 2869717, at *1; Restoration Hardware, Inc. v. Haynes Furniture
Co. Inc., No. 16 C 10665, 2017 WL 2152438, at *2 (N.D. Ill. May 17, 2017) (“Defendants gave
every indication to Plaintiffs and this Court that they were defending the case on the merits
here . . . [and therefore] waived and/or forfeited their argument that venue is improper . . . .”).
Garmin responds that TC Heartland excuses its unmistakable waiver because the Supreme
Court gave rise to a “new defense” that was not previously available and therefore could not have
been asserted. See, e.g., (Dkt. No. 132 at 3 (“TC Heartland permitted Garmin to assert a new
defense under Rule 12(b)(3) that was not previously available.”); Dkt. No. 132 at 3 (“Garmin could
not plead an improper venue defense under the Federal Circuit’s controlling decision in VE
Holding . . . .”).) However, as a majority of courts have recognized and this Court now holds, TC
Heartland was not an intervening change in the law. 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].”); Chamberlain Group, Inc. v. Techtronic 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-cv4987, 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 *3 (D. Mass. June 29, 2017) (same); Infogation, No. 16-CV-01902-H-JLB, 2017
WL 2869717, at *4 (same). In fact, the Supreme Court itself expressly rejected the notion that
venue law in patent cases changed after Fourco. TC Heartland, 137 S. Ct. at 1520.
Defendants’ reliance on Gucci Am., Inc. v. Weixing Li, 768 F.3d 122 (2d Cir. 2014) (finding
no waiver of personal jurisdiction because Daimler was an intervening change in law) is
misplaced. First, Gucci does not control in this case. Second, Gucci did not address waiver under
Federal Rule of Civil Procedure 12. Id. at 135–36 n.14 (“[W]e note that the waiver provisions of
that rule are inapplicable . . . .”). Finally, the unique posture of TC Heartland cautions against
analogizing to cases in which courts sometimes allow litigants to raise new arguments after the
Supreme Court divines a previously unannounced rule or standard. Defendants here could have
relied on “definitive and unambiguous” Supreme Court precedent in raising their argument.
TC Heartland, 137 S. Ct. at 1520 (describing the rule announced in Fourco). See also Rodriguez
de Quijas v. Shearson/Am. Exp., Inc., 490 U.S. 477, 484 (1989) (“If a precedent of this Court has
direct application in a case, yet appears to rest on reasons rejected in some other line of decisions,
[courts] should follow the case which directly controls, leaving to this Court the prerogative of
overruling its own decisions.”). As Defendants acknowledge, other litigants did exactly that. (Dkt.
No. 132 at 5–6 (citing several cases).) For more than fifteen months, however, Defendants raised
no similar objection, but all the while continued to actively litigate before this Court within the
clear context of its two previous admissions as to proper venue.
Ultimately, the Court concludes that Defendants waived their present objection to venue
by twice admitting venue was proper in the Eastern District of Texas and by continuing to litigate
in this case without raising any objection to venue until two months before trial was set to begin.
See Neirbo, 308 U.S. 167–68 (1939) (concluding that the right to object to venue “may be lost by
failure to assert it seasonably, by formal submission in a cause, or by submission through
conduct”). Further, the Court concludes that because TC Heartland does not qualify as an
intervening change of law, this waiver is not excused.
Based on the foregoing analysis, Defendants’ motion to dismiss or, in the alternative, to
transfer (Dkt. No. 132) is DENIED.
SIGNED this 19th day of December, 2011.
So ORDERED and SIGNED this 11th day of July, 2017.
UNITED STATES DISTRICT JUDGE
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