JPT Group, LLC v. Balenciaga et al

Filing 39

MEMORANDUM AND ORDER granting 24 MOTION to Transfer Case to Southern District of New York. (Signed by Judge Ewing Werlein, Jr) Parties notified.(gclair, 4)

United States District Court
Southern District of Texas

ENTERED
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
JPT GROUP, LLC,

§
§
§
§
§

Plaintiff,
v.

David J. Bradley, Clerk

CIVIL ACTION NO. H-16-1596

§
§
§
§
§

BALENCIAGA and BALENCIAGA
AMERICA INC.
I

February 10, 2017

I

Defendants.

MEMORANDUM AND ORDER
Pending is Defendant Balenciaga America,
Transfer Venue Pursuant to 28 U.S.C.
After

carefully

considering

the

1404(a)

§

motion,

Inc. 's Motion to
(Document No. 24).
response,

reply,

supplemental response, and applicable law, the Court concludes for
the reasons that follow that the motion should be granted.
I. Background
Plaintiff JPT Group, LLC ("Plaintiff") owns two design patents
for ornamental women's sandals and sells "MOJO" sandals embodying
the patents under its Bernardo brand. 1

Plaintiff alleges that

Defendant Balenciaga America, Inc. ("Defendant"), together with its

Document No. 1 ~~ 1, 12-16 (Orig. Compl.); id., ex. A
(United States Patent No. D581,149); id., ex. B (United States
Patent No. D577,182).
1

parent

Balenciaga, 2

company,

studded

infringes

thong

sandals

Plaintiff's
throughout

patents

selling

similar

States. 3

Plaintiff seeks damages, attorneys' fees, and a permanent

injunction against further infringement. 4
28

u.s.c.

§

the

by

United

Defendant moves under

1404(a) to transfer venue to the Southern District of

New York, arguing that the only connection between the case and the
Southern District of Texas is the location of Plaintiff's counsel
and that the Southern District of New York,

where Defendant is

headquartered and where both parties engage in extensive marketing
and

sales

of

their

respective

products,

would

be

the

most

convenient and appropriate venue. 5
II. Legal Standard
"For the convenience of parties and witnesses, in the interest
of justice, a district court may transfer any civil action to any

2

Defendant Balenciaga, a French company with its principal
place of business in Paris, has not been served or made an
appearance in this case, although Plaintiff represents that it "has
initiated service of Balenciaga in France through the Hague
Convention." Document No. 34 at 3. To the extent that Defendant
Balenciaga's interests should be considered as part of the venue
transfer analysis, they weigh in favor of transfer, as travel from
Paris to New York is more convenient than travel from Paris to
Houston.
3

Document No. 1

~~

17-27.

4

Id. at 5-6. Defendant alleges counterclaims for declaratory
judgments of non-infringement and invalidity of Plaintiff's
patents. Document No. 27.
5

Document No. 24.
2

other district or division where it might have been brought or
to any district or division to which all parties have consented."
28

u.s.c.

§

1404 (a).

The

purpose

of

section

1404 (a)

is

to

protect litigants, witnesses, and the public against unnecessary
inconvenience and expense, and to avoid the waste of time, energy,
and money.

Van Dusen v. Barrack, 84 S. Ct. 805, 809 (1964).

The

transfer of an action under section 1404 is committed to the sound
discretion of the district court.

Jarvis Christian Coll. v. Exxon

Corp., 845 F.2d 523, 528 (5th Cir. 1988) . 6
Under section 1404(a), the movant bears the burden of showing
"good cause"

to transfer venue.

In re Volkswagen of Am.,

("Volkswagen II"),

545 F.3d 304,

"This

burden reflects the appropriate deference to

'good cause'

315

(5th Cir.

2008)

Inc.

which the plaintiff's choice of venue is entitled."
movant

demonstrates

convenient,

that

the

transferee venue

is

Id.

(en bane).

"When the

clearly more

. it has shown good cause and the district court

should therefore grant the transfer."

However,

"when the

transferee venue is not clearly more convenient than the venue
chosen

by

the

plaintiff,

the

plaintiff's

6

choice

should

be

"Though patent cases are appealed to the Federal Circuit,
the Federal Circuit follows Fifth Circuit law on procedural issues
such as section 1404's convenience analysis."
RSI Video Techs.,
Inc. v. Vacant Prop. Sec., LLC, No. 3:13-CV-00170, 2013 WL 5530619,
at *1 (S.D. Tex. Oct. 4, 2013) (Costa, J.) (citing In re Microsoft
Corp., 630 F.3d 1361, 1363 (Fed. Cir. 2011) (applying Fifth Circuit
law in reviewing a district court ruling on a motion to transfer on
convenience grounds)).
3

respected."

Id.

A court should not transfer a case "if the only

practical effect is to shift inconvenience from the moving party to
the nonmoving party."

Goodman Co., L. P. v. A

F. Supp. 2d 766, 776 (S.D. Tex. 2005)
omitted).
the

&

H Supply, Inc., 396

(quotation marks and citation

"[W]here, as is the case here, the plaintiff is not from

forum it has chosen,
Molina v.

deference."

the plaintiff's choice is given less

Vilsack,

No.

CIV.

A.

V-09-40,

2009

WL

5214098, at *2 (S.D. Tex. Dec. 23, 2009).
The

threshold

issue under section 1404 (a)

is

whether

the

plaintiff's claim could have been filed in the judicial district to
which transfer is sought.

In re Volkswagen AG ("Volkswagen I") ,

371 F.3d 201, 203 (5th Cir. 2004).
a

number

of

private

interest

If so, the court then considers

and

public

interest

factors

to

determine whether transfer is for the convenience of the parties
and in the interest of justice.

Volkswagen II, 545 F.3d at 315.

The private interest factors are:
to sources of proof;

(1) the relative ease of access

(2) the availability of compulsory process to

secure the attendance of witnesses;

(3) the cost of attendance for

willing witnesses; and (4) all other practical problems that make
trial of a

case easy,

expeditious,

public interest factors are:
flowing from court congestion;

and inexpensive.

Id.

The

(1) the administrative difficulties
(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

4

of unnecessary problems of conflict of laws or in the application
of foreign law.
most

transfer

Id.

Although these factors "are appropriate for

cases,

they

are

not

necessarily

exclusive," and no single factor is dispositive.

exhaustive

or

Id.

III. Analysis
It is undisputed that Plaintiff could have filed suit in the
Southern District of New York, where Defendant is headquartered.
The

Court

therefore

looks

to

the

private

and public

interest

factors to determine whether transfer would be convenient and in
the interest of justice.
A.

Private Interest Factors
1.

Relative Ease of Access to Sources of Proof

"In patent

infringement

cases,

the

bulk

of

evidence usually comes from the accused infringer.

the

relevant

Consequently,

the place where the defendant's documents are kept weighs in favor
of transfer to that location."
1338,

1345

(Fed.

2009)

566 F.3d

World Wide

Lines, Inc., 425 F. Supp. 2d 325, 330 (E.D.N.Y. 2006)).

The record

(1) Defendant's headquarters and principal place

of business are in New York;
executive,

(quoting Neil Bros.

Inc.,
v.

evidence is that:

Cir.

In re Genentech,

advertising,

(2) all of Defendant's "management,

marketing,

wholesale

and

retail

distributions," along with the "personnel and documents relevant to
5

these functions," are located in New York;

(3) Defendant's finance

employees and documents are in New Jersey,

fewer than ten miles

from the courthouse for the Southern District of New York;

and

(4) all of Defendant's "records and documents in the United States
that may be relevant to this lawsuit are located in and in close
proximity

to

New

York." 7

Defendant

also

identifies

thirteen

current and former employees located in New York who have knowledge
of the sales, marketing, advertising, distribution, and customer
interactions related to Defendant's allegedly infringing sandals. 8
Moreover,
York,

while Plaintiff attempts

to minimize its ties to New

there is at least some evidence that Plaintiff's Bernardo

brand, which markets the patented sandals at issue, is or recently
was headquartered in New York. 9

7

As this Court recently concluded,

Document No. 24-1 at 1-2.

8

Id. at 3-4. Plaintiff attempts to minimize the significance
of Defendant's New York-based operations and evidence by arguing
that the key documents and witnesses related to Defendant's design
and development of its sandals are likely located in Europe, where
Defendant's parent company is based. Document No. 34 at 9-10. To
the extent that additional evidence located in Europe is central to
Plaintiff's claims against Defendant, it does not weigh against
transfer. See RSI Video, 2013 WL 5530619, at *3 ("The possibility
that more evidence might be located in the United Kingdom [where
the allegedly infringing products are designed and manufactured]
than in Chicago [where the defendant is headquartered] or anywhere
else does not help RSI because the 'question is relative ease of
access, not absolute ease of access.'") (citing In re Radmax Ltd.,
720 F.3d 285, 288 (5th Cir. 2013)).
9

See, e.g., Document No. 37-2 at 2 of 62 and 14 of 62 (copy
of Bernardo website from January 2016 stating that its headquarters
are based in New York) .
6

"[r]egardless of the true location of its headquarters, Bernardo
clearly has significant connections to New York."

JPT Grp., LLC.

v. Steven Madden Retail, Inc., No. CV H-15-3264, 2016 WL 3523878,
at *2 (S.D. Tex. June 28, 2016)

(Miller, J.).

The evidence and witnesses available in the Southern District
of Texas are comparatively less significant.
corporation

with

neither argues

its

principal

nor presents

documents in Texas.

place

evidence

Plaintiff, a Delaware

of

business

that

it has

in

Oregon, 10

employees or

Instead, Plaintiff argues that various former

employees of the previous owners of the patents at issue and other
witnesses who were involved with the prosecution of the patents
reside in Texas. 11
central

to this

These witnesses' testimonies are unlikely to be
infringement case,

for which

"the bulk of

relevant evidence" is likely to come from Defendant. 12

10

the

Genentech,

Document No. 1 ~ 3 .

11

Document No. 34 at 7-8. Notably, the actual inventor of the
patents at suit, Dennis Comeau, whose contact information Plaintiff
lists as "Counsel for JPT," Document No. 34-1 at 6, is not a Texas
resident, and in a prior case Comeau's counsel advised all parties
that "Mr. Comeau
has transacted all business with [the
plaintiff] JPT Group and [the defendant] Steve Madden Companies in
New York City and has never done business with either company in
Texas." Document No. 37, ex. DD at 62 of 62.
12

In a previous case filed by Plaintiff alleging infringement
of the same patents, the only witness upon whom Plaintiff relied at
summary judgment was its manager in Oregon; none of the purportedly
critical Texas witnesses provided testimony.
See Plaintiff JPT
Group's Response to Defendants' Motion for Summary Judgment and
Cross Motion for Summary Judgment of Infringement, JPT Group, LLC
v. Express, Inc., No. 4:15-cv-2757 (S.D. Tex. Aug. 8, 2016), ECF
No. 26.
7

566 F.3d at 1345; see also Spiegelberg v. Collegiate Licensing Co.,
402 F. Supp. 2d 786, 791-92 (S.D. Tex. 2005)

("Courts have observed

that ' [i] ntellectual property infringement suits often focus on the
activities

of

the

alleged

documents;

therefore

the

infringer,

location

of

its

employees,

the

alleged

and

its

infringer's

principal place of business is often the critical and controlling
consideration'

in

adjudicating

(quoting Houston Trial Reports,

transfer

of

venue

motions.")

Inc. v. LRP Publ'ns, Inc., 85 F.

Supp. 2d 663, 668 (S.D. Tex. 1999)).
Finally, Plaintiff's contention that Defendant has important
documents and witnesses in Texas because its products are sold here
is a hollow argument.

Defendant produces evidence that

" [a] 11

sales reporting, inventory information, and documents relevant to
advertising and promotion of BALENCIAGA products in the U.S. are
centralized

in

[Defendant's]

information related to this
retailers in Texas,

New
suit

York

office,"

such

that

is required from third party

and that Defendant's sales in New York "far

exceed" its sales in Texas. 13

Accordingly,

the relative ease of

access to evidence factor weighs heavily in favor of transfer.

13

no

Document No. 37-1 at 2.
8

2.

Availability of Compulsory Process to Secure the
Attendance of Witnesses

A district

court may compel a

witness

to attend a

trial,

hearing, or deposition that takes place within 100 miles of where
the person resides, is employed, or regularly transacts business in
person.

FED. R. Crv. P. 45(c) (1) (A).

subpoena power over most of
Defendant's,

Accordingly, this Court has

Plaintiff's witnesses

but none of

and the Southern District of New York has subpoena

power over Defendant's witnesses but not Plaintiff's.
employees

in Oregon,

of

course,

are not

subject

to

Plaintiff's
compulsory

process in either court.
Plaintiff urges that this factor nevertheless weighs against
transfer because Defendant's New York witnesses are its employees
and compulsory process is unnecessary to compel their attendance,
unlike the third-party witnesses in Texas on whom Plaintiff claims
it will rely. 14

Plaintiff's argument has been called into question

by a recent decision by this Court.

Sandbox Logistics LLC v. Grit

Energy Sols. LLC, No. 3:16-CV-12, 2016 WL 4400312, at *4 (S.D. Tex.
Aug.

17,

2016)

("Some courts

in this District have noted that

witnesses who are employed by one party to the litigation are often
required by their employers to attend and testify at trial, even if
they are not within the subpoena power of the Court.
omitted.]

14

[Citations

The Court notes that the Federal Circuit has not adopted

Document No. 34 at 13.
9

this approach- -even in cases arising within the Fifth Circuit.
Instead,

the

Federal

Circuit

evaluates

the

availability

of

compulsory process for unwilling witnesses without regard to their
status as employees of a party.")

(citing In re Toa Technologies,

543 F. App'x 1006, 1009 (Fed. Cir. 2013); In re Acer America Corp.,
626 F.3d 1252, 1255 (Fed. Cir. 2010)).
However, to the extent that there is any merit in Plaintiff's
argument that the unavailability in New York of compulsory process
for

its

third-party

witnesses

is

more

significant

than

the

unavailability in this Court of compulsory process for Defendant's
employee witnesses, the importance of those third-party witnesses
to

Plaintiff's

patent

infringement

suit

against

a

New

York

defendant should be considered.

The only Texas witnesses listed by

Plaintiff

the

were

involved

with

invention

years

ago,

before

Plaintiff acquired the patents by assignment dated February 11,
2014. 15
are

Of those witnesses listed in Plaintiff's Response, only two

alleged

in

"knowledge about
damages," namely,

an

unexplained

conclusory

statement

to

have

. infringement by the accused products, and
the former President of Bernardo Group and the

former CEO of Bernardo Group.

Given that Plaintiff has not alleged

that infringement of the Patents occurred before February 11, 2014,
the testimony of former officers of the former owner of the Patents
would

appear

15

to

have

only

slight

Document No. 1 at 3.
10

or

attenuated

historical

relevance,
witnesses

if

in this patent

reside in New York.
3.

As

any.

observed

above,

most

of

the

critical

infringement case have been shown to

Thus, on this record, this factor is neutral.

Cost of Attendance for Willing Witnesses

"In considering the availability and convenience of witnesses,
a

court

must

concentrate

primarily

convenience of key witnesses."

upon

and

(E.D. Tex. Oct. 28, 2009)

"In determining whether a particular venue is

more convenient to witnesses,
nature

availability

Remmers v. United States, No. CIV.

A. 1:09-CV-345, 2009 WL 3617597, at *5
(collecting cases) .

the

and quality of

the court should inquire into the

the witnesses'

potential

testimony with

regard to the issues in dispute rather than limit its investigation
to a review of which party can produce the longer witness list."
Id. (collecting cases); see also Houston Trial Reports, 85 F. Supp.
2d at 668

("The convenience of one key witness may outweigh the

convenience
omitted) .

of

numerous

less

important

witnesses.")

( citation

The distance and cost of travel between Houston and New

York is presumably equal for witnesses residing either in Houston
or New York but, as noted above, Defendant's witnesses in New York
are likely to be the key witnesses.
Moreover, although the two witnesses identified by Plaintiff
in Bend, Oregon and Santa Fe, New Mexico reside closer to Houston
than to New York, Defendant presents evidence that there are more

11

flights available from both locations to New York than to Houston,
and that flights

from New Mexico to New York are substantially

cheaper than flights to Houston despite the greater distance, while
flights

from Oregon to New York and

priced. 16

to Houston are

similarly

In sum, considering that most of the key witnesses are

in New York, the cost of attendance factor favors transfer.
4.

All Other Practical Factors

Plaintiff argues that transfer is inefficient because there
are multiple related lawsuits filed by Plaintiff in this district
involving

enforcement

defendants. 17
closed.

of

the

same

patents

against

different

However, all of those cases have been settled and

Hence,

if there was ever an arguable

"efficiency"

to

retaining this case in Houston as companion to similar cases filed
by Plaintiff, that efficiency is no longer present, rendering this
a neutral factor.
In sum, the private interest factors weigh strongly in favor
of transfer.
B.

Public Interest Factors
Because this case involves federal patent law,

interest

factors

involving

the

16

Document No. 24, exs. 0-R.

17

Document No. 34 at 16-17.
12

court's

familiarity

the public
with

the

governing

law

and

the

avoidance

of

unnecessary

neutral. 18

Judges in the Southern District of Texas had an average

of 799 cases filed from July 2015 to June 2016,
cases

in the

Southern District of New York,

conflicts

are

compared to 467

but

the

Southern

District of Texas had a slightly shorter median time from filing to
disposition of civil cases,

so on balance the court congestion

factor is neutral. 19
As for the final public interest factor, the local interest in
having localized interests decided at home, "[w]hile the sale of an
accused

product

substantial

offered

interest

nationwide

does

in any single venue,

not

give
if

rise

to

a

there are

significant connections between a particular venue and the events
that gave rise to a suit,
venue's favor."
(Fed.

Cir.

2009)

this factor should be weighed in that

In re Hoffmann-La Roche Inc., 587 F.3d 1333, 1338
(citations omitted).

products nationwide,

Both parties sell their

but Defendant is headquartered in New York

18

Plaintiff argues as to these factors that this Court is
familiar with the patents in suit due to past cases and that a
single court should determine whether the asserted patents are
valid and enforceable to avoid conflicting decisions.
Id. at 19.
However, none of Plaintiff's other cases on these patents was
assigned to the undersigned Judge. Regardless, all of Plaintiff's
other cases have settled, and the two design patents for studded
sandals at issue here do not involve complex technology or patent
claims regarding which this Court or the undersigned Judge has any
superior expertise.
19

Document No. 24, ex. Fat 37 of 250, 62 of 250.
13

while Plaintiff has no current and ongoing special tie to Houston
other than its counsel having his office here.
to Houston,
significant.

New York's

interest

in the

See RSI Video Techs.

I

Thus, in comparison

litigation is

far more

Inc. v. Vacant Prop. Sec.

I

LLC,

No. 3:13-CV-00170, 2013 WL 5530619, at *4 (S.D. Tex. Oct. 4, 2013)
(Costa, J.)
in a

("[A] district does have a significant local interest

patent

case

when

one

of

the

parties

is

located

in

its

borders.").
A district's local interest in a case may also be significant

where

"the

cause

of

action

calls

into

question

the

work

and

reputation of several individuals residing in or near that district
and

who

presumably

Hoffmann-La Roche,
litigation calls

conduct

business

587 F.3d at 1336.

in

that

community."

Plaintiff argues that the

into question the work and reputation of

the

Houston residents who "contributed to the patents in suit and what
the Bernardo brand is today," as well as the work and reputation of
the local patent prosecution firm that obtained the patents, such
that Houston is

the proper venue. 20

With due

respect

for the

innovation and work of those who obtained the patents in suit about
ten years ago,

they sold those patents years ago to Plaintiff.

Thus, Plaintiff's accusations in its Complaint do not implicate the
work and reputation of those who sold their interests to Plaintiff

20

Document No. 34 at 18.
14

but do have direct implications for the work and reputation of
Defendant's

employees

in

New

willful patent infringement.

York,

whom

Plaintiff

On the whole,

accuses

of

the local interest

factor weighs heavily in favor of transfer.
C.

Conclusion
After careful consideration of the private and public interest

factors, the Court finds that all of the private and public factors
either weigh in favor of transfer or are neutral.

Defendant has

established that the Southern District of New York is clearly a
more convenient forum for the parties and witnesses and, therefore,
in the interest of justice this cause will be transferred to the
Southern District of New York.
IV. Order
For the foregoing reasons, it is
ORDERED that Defendant Balenciaga America,
Transfer Venue Pursuant to 28 U.S.C.

§

1404(a)

Inc.'s Motion to

(Document No. 24) is

GRANTED and this case is TRANSFERRED to the United States District
Court for the Southern District of New York.
The Clerk will

enter this

Order and mail a

copy of

this

Memorandum and Order to the Clerk of the United States District

15

Court for the Southern District of New York, and shall send copies
to all counsel of record.

SIGNED at Houston, Texas, on

this~~ of February,

2017.

G WERLEIN,
~TES DISTRICT JUDGE

16