Eclipse IP, LLC v. ECCO USA, Inc.
Filing
34
MEMORANDUM OPINION AND ORDER GRANTING 27 DEFENDANT'S MOTION FOR TRANSFER OF VENUE. Signed by Senior Judge Frederick P. Stamp, Jr. on 10/30/2013. (copy to counsel of record via CM/ECF) (nmm)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF WEST VIRGINIA
ECLIPSE IP, LLC,
Plaintiff,
v.
Civil Action No. 5:12CV160
(STAMP)
ECCO USA, INC.,
Defendant.
MEMORANDUM OPINION AND ORDER
GRANTING DEFENDANT’S MOTION FOR TRANSFER OF VENUE
I.
Background
The plaintiff, Eclipse IP, LLC, filed the above-styled civil
patent action with this Court alleging that the defendant, ECCO
USA, Inc., infringed on one or more of its patents.
The plaintiff
asserts a total of five different patent infringement claims.
The
alleged infringements are based on the defendant’s use of its
electronic order, purchase, and product return status messaging and
information systems.
As relief, the plaintiff seeks monetary
damages, including interest from the date of infringement, and all
other remedies available based on the defendant’s alleged willful
infringement.
Further, the plaintiff seeks attorneys’ fees and
costs.
After answering the complaint, the defendant filed a motion
for transfer of venue to the United States District Court for
District
of
New
Hampshire
pursuant
to
28
U.S.C.
§
1404(a).
Thereafter, the plaintiff responded and the defendant replied.
Thus, the motion is fully briefed and ripe for review.
For the
reasons set forth below, the defendant’s motion to transfer venue
is granted.
II.
Applicable Law
A motion to transfer a case to another venue is subject to the
provisions of 28 U.S.C. §§ 1404(a) and 1391(a).
Pursuant to 28
U.S.C. § 1404(a), “a district court may transfer any civil action
to any other district or division where it might have been brought”
where such transfer is made “[f]or the convenience of parties and
witnesses, in the interest of justice.” 28 U.S.C. § 1404(a). This
rule is intended to allow a court to transfer venue in order to
“make trial of a case easy, expeditious and inexpensive.” Gulf Oil
Corp. v. Gilbert, 330 U.S. 501, 508 (1947) (superceded by statute
on other grounds).
The decision to transfer venue is left to the sound discretion
of the trial court.
(4th Cir. 1956).
Southern Ry. Co. v. Madden, 235 F.2d 198, 201
In making this determination, a court should
consider:
(1) ease of access to sources of proof; (2) the
convenience of parties and witnesses; (3) the cost of
obtaining the attendance of witnesses; (4) the
availability of compulsory process; (5) the possibility
of a view; (6) the interest in having local controversies
decided at home; and (7) the interests of justice.
In re Campbell Transp. Co., Inc., 368 F. Supp. 2d 553, 555-56 (N.D.
W. Va. 2005) (citing Alpha Welding & Fabricating Co. v. Todd
Heller, Inc., 837 F. Supp. 172, 175 (S.D. W. Va. 1993)).
2
The
movants typically bear the burden of demonstrating that transfer is
proper. Versol B.V. v. Hunter Douglas, Inc., 806 F. Supp. 582, 592
(E.D. Va. 1992).
The Supreme Court of the United States has
further stated that “unless the balance is strongly in favor of the
defendant,
the
disturbed.”
plaintiff’s
choice
forum
should
rarely
be
Gulf Oil, 330 U.S. at 508.
III.
A.
of
Discussion
Transfer of Venue
The parties in this action do not contest that the plaintiff
“might have brought” this action in the United States District
Court for the District of New Hampshire.
Thus, the issue is
whether the interests of justice and the convenience to the parties
weigh in favor of transferring venue.
The defendant argues that
based on the factors outlined above, justice and convenience both
weigh in favor of transferring venue.
The plaintiff contests this
argument, and instead, asserts that such factors require that this
Court deny the defendant’s motion for transfer of venue.
1.
Ease of Access to Sources of Proof
First, concerning the ease of access to sources of proof, the
defendant asserts that the relevant proof is located in the
District of New Hampshire.
Specifically, it asserts that all of
the documents concerning its online sales system, which is the
system involved in the plaintiff’s patent infringement claims,
reside at the defendant’s corporate headquarters in New Hampshire.
3
The plaintiff, however, asserts that to the extent that relevant
proof is located in New Hampshire, this fact should be accorded
little weight if any, as the documents can be transported easily or
transferred electronically.
While the plaintiff is correct that
the cost of transferring documents to this district would not be
substantial and may even be done electronically, this Court still
finds that this factor weighs at least somewhat is favor of the
defendant.
2.
Convenience of Parties and Witnesses
Second, as to the convenience of the parties and witnesses,
the defendant argues that its key witnesses live and work in or
near New Hampshire.
Further, the defendant alleges that the
plaintiff has no presence in West Virginia and no key witnesses in
that area.
or
other
The plaintiff argues that the convenience of officers
witnesses
with
interests
closely
aligned
with
the
defendant should be accorded little weight. Further, the plaintiff
argues that the defendant failed to describe the substance of their
testimony so as to provide this Court with enough information to
weigh the importance of witness convenience against other factors.
Initially,
this
Court
finds
that
the
defendant
provided
sufficient information regarding its potential witnesses.
“The
party asserting witness inconvenience has the burden to proffer, by
affidavit or otherwise, sufficient details respecting the witnesses
and their potential testimony to enable the court to assess the
4
materiality of evidence and the degree of inconvenience.”
Koh v.
Microtek Int’l, Inc., 250 F. Supp. 3d 627, 636 (E.D. Va. 2003).
Here, the defendant provided this Court by way of affidavit with a
list of three party witnesses, who are employees of the defendant,
and two non-party witnesses, which are outside consulting firms.
The
defendant
asserts
that
all
three
employees
live
in
New
Hampshire, and one of the two consulting firms has offices in New
Hampshire.
The other consulting firm is alleged to be located in
Massachusetts.
While the defendant does not outline the exact
substance of the testimony, it still provides either the employee’s
job description or the firm’s role in the defendant’s online sales
system.
Thus, based on these descriptions, this Court is able to
infer the basic substance of the testimony, its materiality, and
also the degree of inconvenience to those witnesses.
The plaintiff is correct in noting that courts, in considering
the
convenience
to
witnesses,
“draw[]
a
distinction
between
party-witnesses and non-party witnesses and afford[] greater weight
to the convenience of non-party witnesses.”
Lycos, Inc. v. TiVo,
Inc., 499 F. Supp. 2d 685 (E.D. Va. 2007) (citation omitted).
The
defendant, however, has provided this Court with both witnesses
that are employees of the defendant and also witnesses that are
outside consulting firms.
The plaintiff has provided this Court
with two examples of its witnesses, a manager of the plaintiff and
the alleged inventor of the patent. Neither of these two witnesses
5
reside in this district.
The plaintiff asserts that its manager
maintains a residence in nearby Hermitage, Pennsylvania, and the
inventor originates from Wheeling, West Virginia, and regularly
travels to the area.
As the inventor is allegedly a non-party
witness because he no longer owns the patents, the plaintiff
asserts his convenience should be accorded great weight.
This
Court notes that while the inventor may regularly travel to the
area, this does not make it a convenient forum for him, as the
trial cannot be scheduled around his visits. Thus, the convenience
alleged by the plaintiff as to the inventor is minimal.
Further,
as to the plaintiff’s manager, again this Court cannot schedule a
trial around the manager’s visits to his maintained home, which
this Court notes is located over 100 miles from this point-ofholding court. As such, based on the witnesses that this Court was
provided with and its evaluation of the parties’ arguments, this
Court finds that this factor weighs in favor of transfer.
3.
Cost of Obtaining the Attendance of Witnesses
Third, concerning the cost of obtaining the attendance of the
witnesses in this action, the defendant asserts that it would be
far less expensive to have this action heard in the District of New
Hampshire, as most of the key witnesses reside in New Hampshire.
The defendant further asserts that it is unaware of any key
witnesses who reside or conduct business in West Virginia.
In
opposition, the plaintiff asserts that the Northern District of
6
West Virginia is centrally located and a convenient forum for the
parties and potential non-party witnesses.
Specifically, the
plaintiff asserts that this district is 500 miles closer to the
defendant’s headquarters than to the plaintiff’s headquarters.
This Court finds that this factor weighs in favor of transfer, as
the fact that this district is 500 miles closer to the defendant’s
headquarters does not speak to the cost of having witnesses attend
the trial here.
While the mileage may be less, accommodations and
other travel expenses also must be taken into account.
These
expenses do not change as a result of this district being 500 miles
closer
to
the
defendant’s
headquarters
than
it
is
to
the
plaintiff’s headquarters.
4.
Availability of Compulsory Process
Fourth, as to the availability of compulsory process, the
plaintiff asserts that the documents and witnesses reside outside
of this Court’s subpoena power.
In opposition, the plaintiff
argues that because the witnesses provided by the defendant are
party witnesses, the defendant has not shown that the witnesses
would not willingly appear for trial, and therefore this factor
does not weigh in the defendant’s favor.
It is true that “[w]hen
the appearance of witnesses can be secured regardless of the
forum’s location through court order or persuasion by an employer
who is a party to the action, this factor becomes less important.”
Samsung Electronics Co., Ltd. v. Rambus, Inc., 386 F. Supp. 2d 708,
7
719 (E.D. Va. 2005) (citation and internal quotations omitted).
The defendant, however, has provided two outside consulting firms
whose representatives would act as possible witnesses and the
plaintiff has provided two witnesses, neither of who seem to be
within this Court’s subpoena power.1
Accordingly, as none of the
witnesses, whether party witnesses or non-party witnesses, appear
to be within this Court’s subpoena power, this Court finds that
this factor also weighs in favor of transfer.
5.
Possibility of a View
Fifth, as to the possibility of a view, neither party asserts
that such a view is required.
Although, the defendant does assert
that to the extent a jury will need to personally view any sites
relevant to the dispute, such sites are in New Hampshire.
plaintiff does not contest this argument.
The
This Court, however,
finds that this factor does not weigh in favor of transfer.
The
defendant admits that it does not believe a view will be required;
thus, it would neither be more or less convenient to transfer the
venue to the District of New Hampshire based on this factor if no
such view is likely to occur.
1
Federal Rule of Civil Procedure 45(b)(2) places limits on a
district court’s subpoena power. A subpoena may be served at the
boundaries of the court’s district, or outside of the district, but
within 100 miles of the place specified for the deposition,
hearing, trial, production, or inspection. The other two options
provided by Rule 45(b)(2) do not apply in this circumstance.
8
6.
Interest in Having Local Controversies Decided at Home
Sixth, concerning the interest in having local controversies
decided at home, the defendant argues that this is not a dispute
that is local to West Virginia.
Specifically, the defendant
asserts that neither party employs any citizen of this district and
it is also not alleged that any citizen of this district suffered
harm. Further, the defendant asserts that its online sales in West
Virginia represent only a minute fraction of its revenue.
The
plaintiff does not make any allegations concerning whether or not
this is a local dispute.
After a review of the record in this
matter, this Court finds that the Northern District of West
Virginia has little to no connection with this dispute. Therefore,
this
Court
cannot
find
that
local
interests
are
involved.
Accordingly, this factor weighs in favor of transfer to the
District of New Hampshire, which actually has a local interest due
to the defendant’s headquarters and operations being located within
that district.
7.
Interests of Justice
Seventh, the defendant argues that the interests of justice
favor the District of New Hampshire over the Northern District of
West Virginia.
The defendant argues that while courts give weight
to the plaintiff’s choice of forum, this weight diminishes when the
plaintiff has not chosen its home forum.
Further, the defendant
argues that the District of New Hampshire enjoys a lighter docket
9
and is equally capable of handling a patent infringement action.
The defendant also indicates that the plaintiff has not been
reluctant to initiate patent infringement suits across the country.
Thus, the defendant argues that if the plaintiff has been able to
litigate in such districts as the Central District of California
and the Eastern District of Texas, moving this litigation to New
Hampshire
plaintiff.
should
not
impose
any
meaningful
burden
upon
the
In response, the plaintiff argues that its choice of
forum favors retention of this case. Further, the plaintiff argues
that this Court should consider the fact that the defendant is a
“worldwide conglomerate” “making hundreds of millions of dollars
per year” and the plaintiff is “a small company.”
“The ‘interest of justice’ category is designedly broad.” Bd.
of Tr., Sheet Metal Workers Nat. Fund v. Baylor Hearing & Air
Conditioning, Inc., 702 F. Supp. 1253, 1260 (E.D. Va. 1988).
The
category is “meant to encompass all those factors bearing on
transfer that are unrelated to the other factors.”
JTH Tax, Inc.
v. Lee, 482 F. Supp. 731, 738 (E.D. Va. 2007) (citation omitted).
However, the defendant’s “status as a corporation with sufficient
resources to defend in a foreign forum is not a factor that [a]
court considers in a transfer analysis.”
Id. (citing Precision
Franchising, LLC v. Coombs, No. 1:06CV1148, 2006 WL 3840334, at *5
(E.D.
Va.
Dec.
27,
2006);
Intranexus,
Inc.
v.
Siemens
Med.
Solutions Health Servs. Corp, 227 F. Supp. 2d 581, 584 (E.D. Va.
10
2002)).
Further, while the plaintiff’s choice of forum should
ordinarily be given substantial weight, “a plaintiff’s chosen venue
is not given such substantial weight when the plaintiff selects a
forum other than its home forum and the claims bear little or no
relation to the chosen forum.”
Koh, 250 F. Supp. 2d at 633; see
Klay v. Axa Equitable Life Ins. Co., No. 5:08CV118, 2009 WL 36759,
at *3 (N.D. W. Va. Jan. 6, 2009) (finding that venue should be
transferred where plaintiff’s domicile was located elsewhere and
there was little connection between the plaintiff’s claims and the
judicial district).
In this action, the plaintiff’s chosen venue is accorded
little weight.
The Northern District of West Virginia is not the
plaintiff’s home forum, as the plaintiff’s headquarters are located
in Florida. Further, the patent infringement claims bear little to
no relation to this district, as the defendant indicates that
online
sales
in
the
State
of
West
Virginia
are
minimal.
Additionally, the base of the defendant’s online operations, which
are at issue, is in New Hampshire.
The financial conditions of either party is also not given any
weight.
Thus, regardless of the plaintiff asserting that it is a
“small company,” such assertion does not factor into this Court’s
analysis of whether the transfer of venue is proper.
Further, as
the defendant notes, the plaintiff seems to have filed suits in
numerous other districts far from its headquarters.
11
Thus, even if
the
financial
conditions
were
taken
into
account,
this
fact
diminishes its relevance.
As the defendant indicates, the District of New Hampshire is
fully capable of handling the plaintiff’s claims, as the law
governing the claims is federal, and courts in either district
would look to the law of the Federal Circuit.
While the defendant
argues that the docket conditions in New Hampshire are lighter than
those in this district, this fact is only somewhat relevant.
Tax, 482 F. Supp. at 739.
JTH
The most relevant fact to this Court in
this interests of justice analysis is the fact that there seems to
be little or no connection to this district.
The interests of
justice do not favor requiring a defendant to defend an action in
a district that has little to no connection with the underlying
claims merely because one witness originates and visits this area
and another witness maintains a home over 100 miles from the pointof-holding court.
Thus, weighing all of the factors, this Court finds that the
transfer of venue to a district with more appropriate contacts is
the proper course of action.
Based on all of the above findings,
this Court finds that the United States District Court for the
District of New Hampshire provides a more suitable forum in this
case.
12
B.
Plaintiff’s Request for Limited Discovery
The plaintiff requests that if this Court believes based on
the facts alleged by the defendant that it should transfer venue,
the plaintiff requests that this Court allow discovery on this
issue prior to ruling on the motion.
The plaintiff argues that
such discovery will enable the plaintiff and this Court to better
understand the defendant’s contacts with West Virginia and this
district.
In support of this request, the plaintiff cites Wine Markets
Int’l v. Bass, 939 F. Supp. 178 (E.D. N.Y. 1996).
That case,
however, is clearly distinguishable from the instant action.
The
court in Wine Markets denied the defendant’s motion to transfer
venue without ordering or authorizing any pre-ruling discovery.
Id. at 185.
The court only permitted the defendant to renew such
motion later in the litigation following the normal discovery
process.
Id.
Here, the plaintiff is requesting that this Court
defer a ruling on this motion and allow limited discovery on the
topics associated with venue.
Ordinarily, district courts have broad discretion in granting
limited discovery to explore jurisdictional facts, including venue.
Virginia Innovation Sciences, Inc. v. Samsung Electronics Co.,
Ltd., 928 F. Supp. 2d 863, 874 (E.D. Va. 2013).
In this case,
however, this Court finds no reason to allow such limited discovery
prior to making its ruling on the defendant’s motion to transfer
13
venue.
If the plaintiff filed this action in accordance with Rule
11 of the Federal Rules of Civil Procedure, then plaintiff should
“have some reason to believe that the allegations and other factual
contentions in the [complaint] have evidentiary support.” Saleh v.
Titan Corp., 361 F. Supp. 2d 1152, 1170 (S.D. Cal. 2005) (finding
that allowing discovery prior to ruling on the defendants’ motion
to transfer was inappropriate where the plaintiffs should have had
information in their possession to substantiate the allegations
made against defendants).
Under the heading “jurisdiction and
venue” in the plaintiff’s complaint, the plaintiff alleges that
“this
Court
has
personal
jurisdiction
over
ECCO
because
it
transacts regular business in this judicial district; is operating
and/or supporting products or services that fall within one or more
claims of Eclipse’s patents in this judicial district; and has
committed
district.”
the
tort
of
patent
infringement
in
this
judicial
Thus, if the plaintiff made this claim in accordance
with Rule 11, it represented that it possessed evidentiary support
for the allegation that the claims are connected to this district.
The plaintiff, however, has not provided such support to this
Court.
The defendant, on the contrary, specifically denies these
allegations, and through the briefing of this motion has provided
this Court with specific facts regarding its connection, or rather
lack of connection with this district and the lack of connection
that the plaintiff’s claims have to this district.
14
“Where a party’s request for jurisdictional or venue-related
discovery rests on bare allegations made in the face of specific
denials, the Court need not permit even limited discovery if such
discovery will be a fishing expedition.”
Virginia Innovation
Sciences, 928 F. Supp. 2d at 874 (internal quotations omitted)
(citing Carefirst of M.D., Inc. v. Carefirst Pregnancy Ctrs., Inc.,
334 F.3d 390, 403 (4th Cir. 2003)).
This Court finds that, here
the plaintiff’s request for discovery on issues dealing with venue
amounts to nothing more than an effort to find contrary facts to
those specific denials alleged by the defendant.
The plaintiff’s
bare allegations concerning venue being proper in this instance are
not sufficient for this Court to believe that any limited discovery
will aid the plaintiff in establishing a connection between its
claims and this district.
Thus, it need not permit discovery into
the requested topics prior to making its ruling on the defendant’s
motion to transfer venue.
IV.
Conclusion
For the above stated reasons, the defendant’s motion to
transfer the case to the United States District Court for the
District of New Hampshire is GRANTED.
IT IS SO ORDERED.
The Clerk is DIRECTED to transmit a copy of this memorandum
opinion and order to counsel of record herein and to the Clerk of
the United States District Court for the District of New Hampshire.
15
DATED:
October 30, 2013
/s/ Frederick P. Stamp, Jr.
FREDERICK P. STAMP, JR.
UNITED STATES DISTRICT JUDGE
16
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