Foundation Medicine, Inc. v. Guardant Health, Inc.
MEMORANDUM OPINION AND ORDER. Signed by Magistrate Judge Roy S. Payne on 2/14/2017. (ch, )
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF TEXAS
FOUNDATION MEDICINE, INC.,
GUARDANT HEALTH, INC.,
§ Case No. 2:16-CV-00523-JRG-RSP
MEMORANDUM OPINION AND ORDER
Guardant Health, Inc. (“Guardant”) moves to transfer this case to the Northern District of
California under 28 U.S.C. § 1404(a). Dkt. 12. Because Guardant does not show that the
Northern District of California would be clearly more convenient, Guardant’s motion is
A district court can transfer a case to another district where the case might have been
brought for “the convenience of parties and witnesses” and “in the interests of justice.” 28 U.S.C.
§ 1404(a). The parties do not dispute that this case could have been brought in the Northern
District of California. See In re Volkswagen of Am., Inc., 545 F.3d 304, 312 (5th Cir. 2008)
(“Volkswagen II”); In re Volkswagen AG, 371 F.3d 201, 203 (5th Cir. 2004) (“Volkswagen I”).
The question is whether Guardant has shown the Northern District of California to be “clearly
more convenient” than the Eastern District of Texas. Volkswagen II, 545 F.3d at 315.
The analysis turns on a number of public and private interest factors, none of which is
given dispositive weight. See Volkswagen I, 371 F.3d at 203. The private factors include:
(1) ease of access to evidence (“sources of proof”);
(2) subpoena power over potential witnesses;
(3) cost of attendance for willing witnesses; and
(4) other practical problems.
Volkswagen II, 545 F.3d at 315. The public factors include:
(1) administrative difficulties flowing from court congestion;
(2) 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 conflict of laws.
Volkswagen I, 371 F.3d at 203. To meet the burden of showing that the Northern District
of California is clearly more convenient, Guardant must show that these private and public
interest factors on balance weigh in favor of transfer. See id. The parties dispute only the first
three private factors and the first two public factors.
A. Private Factors
1) Access to Evidence
Although modern technology allows a party to access documents discovered during
litigation from most anywhere, the “physical” location of documents remains important. See
Volkswagen II, 545 F.3d at 316; In re Genentech, Inc., 566 F.3d 1338, 1345 (Fed. Cir. 2009).
Relevant evidence in patent cases often comes from the accused infringer. Genentech, 566 at
1345. Thus, the place where the defendant’s documents are kept weighs may weigh in favor of
transfer to that location. Id.
Most of the relevant evidence in this case is likely located in Redwood City, California,
at Guardant’s headquarters. Guardant’s CEO, Dr. Eltoukhy, indicates that “personnel and
documents, both digital and non-digital, concerning the design and development, technical
processes, and sales of the [accused] GUARDANT360 testing services are located almost
exclusively in Redwood City, California.” Dkt. 12-1 ¶ 8.
Foundation suggests that Guardant’s lone Texas sales associates may have relevant
information, but Guardant shows that this sales associate was hired in 2015, has little if any
relevant information, and that any information he has could easily be obtained from Guardant’s
Redwood City location. Dkt. 12-1 ¶ 8. Foundation also suggests, however, that third-party MD
Anderson in Houston, Texas, has potentially relevant evidence.
Foundation’s evidence, most of which appears to be located at Foundation’s headquarters
in Cambridge, Massachusetts, is entitled to consideration, but it does not shift the balance in
Foundation’s favor. Foundation’s Vice President of Human Resources, Sarah Larson, testified
that most of Foundation’s documents are kept in Massachusetts, Dkt. 22-12 ¶ 8, roughly 1,700
miles from the Eastern District of Texas and 3,100 miles from the Northern District of
California. But because Foundation’s evidence will have to be transported to trial held either
here or in California, the Massachusetts evidence does not outweigh Guardant’s convenience in
being able to access evidence from within the transferee district. See Genentech, 566 F.3d at
1346 (“[B]ecause the documents housed in Europe and Washington, D.C. will need to be
transported in any event, it is only slightly more inconvenient or costly to require the
transportation of those materials to California than Texas.”).
Accordingly, Guardant has shown that the evidence in this case could be accessed more
conveniently from the Northern District of California than from this district. The Court
acknowledges that the analysis regarding access to evidence is entirely fictional—at least in a
case that does not involve significant physical evidence, the Court must envision a world in
which the only way to get documents to trial is to print or retrieve them from their “physical
location” and transport them to trial. See Pabst Licensing v. Apple, Case No. 6:15-CV-01095RWS, Dkt. No. 143 at 4 (E.D. Tex. Sept. 30, 2016); see also Volkswagen II, 545 F.3d at 316;
Genentech, 566 at 1346 (“[T]he court’s antiquated era argument was essentially rejected in
Volkswagen because it would render [the evidence] factor superfluous.”). The first factor
therefore weighs in favor of transfer.
2) Subpoena Power Over Potential Witnesses
A district court’s subpoena power is governed by Federal Rule of Civil Procedure 45. For
purposes of § 1404(a), there are three important parts to Rule 45. See VirtualAgility, Inc. v.
Salesforce.com, Inc., No. 2:13-CV-00011-JRG, 2014 WL 459719, at *4 (E.D. Tex. Jan. 31,
2014) (explaining 2013 amendments to Rule 45). First, a district court has subpoena power over
witnesses that live or work within 100 miles of the courthouse. See Fed. R. Civ. P. 45(c)(1)(A).
Second, a district court has subpoena power over residents of the state in which the district court
sits—a party or a party’s officer that lives or works in the state can be compelled to attend trial,
and nonparty residents can be similarly compelled as long as their attendance would not result in
“substantial expense.” See Fed. R. Civ. P. 45(c)(1)(B)(i)-(ii). Third, a district court has
nationwide subpoena power to compel a nonparty witness’s attendance at a deposition within
100 miles of where the witness lives or works. See Fed. R. Civ. P. 45(a)(2), 45(c)(1).
Guardant identifies two nonparty inventors that now live in California and are thus
subject to the Northern District of California’s subpoena power. But these inventors have stated
that they would willingly attend trial in Marshall and would not be inconvenienced from doing
so. The California inventors are therefore entitled to minimal if any weight. See ContentGuard
Holdings, Inc. v. Amazon.com, Inc., No. 2:13-CV-1112-JRG, 2015 WL 1885256, at *10 (E.D.
Tex. Apr. 24, 2015).
The only dispute is whether this Court’s subpoena power over potential nonparty
witnesses from MD Anderson is significant. Foundation contends that they intend to call MD
Anderson researchers to testify at trial because their collaboration with Guardant involved
“clinical evidence of Guardant360’s utility.” Dkt. 27 at 2-3. Because the MD Anderson
researchers are within this Court’s subpoena power but not within the transferee court’s reach,
the witnesses are entitled to consideration.
Guardant explains that collaborations similar to the one with MD Anderson occurred at
other research institutions, including two collaborations at research institutions within the
Northern District of California. Dkt. 22, Exhibits 1-11. But Foundation wishes to call MD
Anderson witnesses to trial, and the Court is not in a position at this stage to say that other
California witnesses would be acceptable substitutes. While a district court should assess the
“relevance and materiality of the information the witness may provide,” it is not necessary for a
party “to show that the potential witness has more than relevant and material information.” In re
Genentech, 566 F.3d at 1343. Accordingly, the second factor weighs against transfer.
3) Cost of Attendance for Willing Witnesses
Witness convenience and costs of attending trial are important considerations. In re
Genentech, 566 F.3d 1338 at 1343. “When the distance between an existing venue for trial of a
matter and a proposed venue under § 1404(a) is more than 100 miles, the factor of inconvenience
to witnesses increases in direct relationship to the additional distance to be traveled.”
Volkswagen I, 371 F.3d at 204-05. “Additional distance means additional travel time; additional
travel time increases the probability for meal and lodging expenses; and additional travel time
with overnight stays increases the time which these fact witnesses must be away from their
regular employment.” Id. at 205.
There is little dispute that a trial in the Northern District of California would be more
convenient for party witnesses. Guardant shows that its witnesses all live or work in and around
Redwood City, California. Dkt. 12-1 ¶ 6. Aside from a handful of Foundation’s sales and
marketing personnel that live or work in Texas, Foundation’s employees, including six of the
eight inventors of the asserted patent, live in Massachusetts. Dkt. 22 at 6; Dkt. 22-12 ¶ 9.
Foundation’s employees will be required to travel and spend time away from home in any event.
See Genentech, 566 F.3d at 1346. Neither party submits evidence showing that a trial in the
Northern District of California would last longer than the typical one-week patent trial in
Marshall, or evidence showing comparative costs of attendance, and thus the Court cannot
realistically assess the relative cost for out-of-town witnesses.
Of the proposed nonparty witnesses, Foundation’s MD Anderson witnesses would find it
more convenient to travel to Marshall. The convenience of the nonparty witnesses typically
carries the greatest weight in the analysis, see, e.g., Aquatic Amusement Assoc., Ltd. v. Walt
Disney World Co., 734 F. Supp. 54, 57 (N.D.N.Y. 1990), and thus the Court gives significant
weight to Foundation’s MD Anderson witnesses. Accordingly, the potential cost and
inconvenience saved from eliminating the need for Guardant’s witnesses to travel to Marshall
stands against the inconvenience and cost to Foundation’s nonparty witnesses. The third factor
therefore is neutral.
B. Public Factors
The parties dispute only the first two public interest factors—administrative difficulties
and local interest. With respect to administrative difficulties, Foundation argues that the faster
time to trial in this district weighs against transfer. Guardant itself cites statistics showing that
this district has an average time to trial of 20.9 months and the Northern District of California
has an average time to trial of 26.7 months. Guardant contends that six months is insignificant,
but the Court disagrees. The court congestion factor generally favors a district that can bring a
case to trial faster. See In re Genentech, 566 F.3d at 1347. On the basis of the record evidence,
Foundation is likely able to get to trial here 25% faster than in the Northern District of
California. Accordingly, the first public interest factor weighs slightly against transfer.
The local interest factor, on the other hand, weighs in favor of transfer. Guardant is
headquartered in California, developed the accused product in California, and conducts the
accused testing in California. Dkt. 12-1. While a handful of Foundation’s sales and marketing
personnel live or work in Texas, a generalized commercial presence is typically not sufficient to
demonstrate any meaningful local interest in the outcome of a case. See In re Nintendo Co., Ltd.,
589 F.3d 1194, 1198 (Fed. Cir. 2009) (citing Volkswagen II, 545 F.3d at 317-18); In re TS Tech
USA Corp., 551 F.3d 1315, 1321 (Fed. Cir. 2008). Guardant’s presence in California, however,
weighs only slightly in favor of transfer. As other district courts have recognized, it is generally a
fiction that patent cases give rise to local controversy or interest, particularly without record
evidence suggesting otherwise. See TriStrata Tech., Inc. v. Emulgen Labs., Inc., 537 F. Supp. 2d
635, 643 (D. Del. 2008).
On balance, the relevant factors do not favor transferring this case to the Northern
District of California, and Guardant has failed to show that the Northern District of California is
clearly more convenient than this district. See Volkswagen II, 545 F.3d at 315. Guardant’s
motion to transfer (Dkt. 12) is therefore DENIED.
SIGNED this 3rd day of January, 2012.
SIGNED this 14th day of February, 2017.
ROY S. PAYNE
UNITED STATES MAGISTRATE 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?