Thursday, June 29, 2017

TC Heartland Does Not Qualify as Intervening Change of Law Excusing Waiver of § 1400(b) Venue Challenge​

Following the recent Supreme Court decision in TC Heartland LLC v. Kraft Foods Group Brands LLC, 137 S. Ct. 1514 (2017), the court denied defendant's motion to dismiss or transfer plaintiff's patent infringement action for improper venue two months before trial because TC Heartland was not an intervening change in law. "[Defendant's] argument . . . appears to be that following the decision in [VE Holding Corp. v. Johnson Gas Appliance Co., 917 F.2d 1574 (Fed. Cir. 1990)] in 1990 up until the Supreme Court decided TC Heartland in May of 2017, the highest authority available had deemed [Fourco Glass Co. v. Transmirra Products Corp., 353 U.S. 222 (1957)] overridden by congressional action, and accordingly the Supreme Court’s reaffirming of Fourco constituted a change of law. . . . [E]xcept where congressional abrogation of a Supreme Court decision is express, 'only [the Supreme] Court may overrule one of its precedents' -- whether through its own opinion or recognition of congressional override -- and until that occurs, Fourco is and still was the law. . . . The intervening twenty-seven years may have created reliance on VE Holding by litigants, including [defendant], but that 'does not change the harsh reality' that a party could have 'ultimately succeeded in convincing the Supreme Court to reaffirm Fourco, just as the petitioner in TC Heartland did.'”

iLife Technologies, Inc. v. Nintendo of America, Inc., 3-13-cv-04987 (TXND June 27, 2017, Order) (Lynn, USDJ)

Wednesday, June 28, 2017

Failure to Challenge Venue Prior to TC Heartland Does Not Waive Venue Objection​

Following the Supreme Court decision in TC Heartland LLC v. Kraft Foods Group Brands LLC, No. 16-341 (May 22, 2017), the court granted defendants' motion to modify their pending motion to dismiss under Rule 12(b)(6) to add a ground of improper venue and found there was no waiver by failing to raise the issue in their original motion. "[Plaintiff] contends an argument for an improper venue was available to Defendants, and has been since 1957 when the Supreme Court announced [Fourco Glass Co. v. Transmirra Products Corp., 353 U.S. 222 (1957)]. A defendant waives the defense of improper venue if it was available but the defendant omitted it from its responsive pleading or from a motion made before its responsive pleading. . . . TC Heartland abrogated approximately 27 years of patent law precedent. . . . For the first time in 27 years, a defendant may argue credibly that venue is improper in a judicial district where it is subject to a court’s personal jurisdiction but where it is not incorporated and has no regular and established place of business. Defendants could not have reasonably anticipated this sea change, and so did not waive the defense of improper venue by omitting it from their initial pleading and motions."

Westech Aerosol Corporation v. 3M Company et al, 3-17-cv-05067 (WAWD June 21, 2017, Order) (Leighton, USDJ)

Tuesday, June 27, 2017

New Trademark, Copyright and Antitrust Docket Reports Now Available (Free Through 2017)!

Docket Navigator is pleased to announce the release of new Docket Reports covering federal Trademark, Copyright and Antitrust litigation. Like the Patent Docket Report, the new Docket Reports will include professionally written summaries of all new cases and significant decisions with free links to the underlying pleadings, court orders, and docket sheets. You can also create alerts for individual cases to track new filings and perform searches on a limited scope of data in our new search engine, Compass, which is in beta.

The new Docket Reports are free through the end of 2017. This extended preview period allows plenty of time to evaluate before deciding whether to budget for a subscription. It also allows us time to receive feedback and make changes, if necessary, before we begin charging for the service in 2018. Of course, there is no obligation to subscribe after the free preview, and there will be no "surprise" auto-billing of any kind.

To receive any of the new Docket Reports, please click here.

Defendant’s Authorization to Conduct Business in Texas, Listing Texas Distributors on Website, and Selling Products in Texas Insufficient to Establish Texas Venue​

Following the Supreme Court decision in TC Heartland LLC v. Kraft Foods Group Brands LLC, 137 S.Ct. 1514 (2017), the court granted defendants' motion to dismiss plaintiff's patent infringement action for improper venue because plaintiff failed to present sufficient evidence that defendants had a regular and established place of business in the forum. "'The fact that [defendants] are authorized to do business in Texas is not controlling and will not establish the [§ 1400(b)] requirement.' Nor does defendants' website allowing viewers to access a list of San Antonio/Austin distributors provide venue under the patent infringement statute. Finally, the fact that defendants sell their activity trackers to distributors in Texas Western will not establish venue. . . . Therefore, the kind and degree of defendants’ contacts do not support a finding that defendants have a permanent and continuous presence which shows a regular and established place of business in the Western District of Texas."

LoganTree v. Garmin International, Inc. et al, 5-17-cv-00098 (TXWD June 22, 2017, Order) (Biery, USDJ)

Monday, June 26, 2017

Assignment Requiring Plaintiff to Pay Transferor 100% of Gross Proceeds From Litigation Does Not Deprive Plaintiff of Standing

The court denied defendant's motion to dismiss plaintiff's patent infringement action for lack of standing because plaintiff obtained substantial rights to the patents-in-suit through its assignment from the prior owner even though it had to surrender 100% of litigation and licensing proceeds to the prior owner. "[Plaintiff's] Agreement is nearly identical to the [prior owner's] Agreement. The only difference is that the transferee must pay 100% of the gross proceeds from litigation and licensing to the transferor, rather than 50% in the [prior owner's] Agreement. Again, this is compensation for the transfer that does not reserve any control for the assignor over the Asserted Patents or their use. . . . Defendant argues that Plaintiff has no economic interest because he must surrender the gross proceeds from the litigation to [the prior owner]. However, this does not diminish Plaintiff’s rights to the Asserted Patents for the purpose of standing. Any infringement of Plaintiff’s exclusive right to make and sell the patented products would still cause Plaintiff to suffer a justiciable injury, regardless of whether he retains any damages awarded for that injury."

Agarwal v. Buchanan d/b/a Jeff Buchanan Tree Services d/b/a Buchanan Industries d/b/a Wood Chipper Safety Shield, 2-17-cv-02182 (CACD June 22, 2017, Order) (O'Connell, USDJ)

Friday, June 23, 2017

Eve of Trial Supplement to Damages Expert Report Justifies Monetary Sanctions Award​

The court sanctioned plaintiffs for producing an unsolicited addendum to their damages expert report which required defendants to file a motion to strike. "The Court has now three times granted Defendants’ Daubert Motions on the issue of [the expert's] estimation of indirect sales in the United States to prove damages for indirect infringement. . . . Given that the Court’s orders have been entirely clear and [plaintiff] has provided no justifiable explanation for why [the expert] impermissibly supplemented his report without leave of Court on the eve of trial, thereby forcing [defendants] to file the instant emergency motion, the Court finds that fees for the motion are appropriately awarded to [defendants]."

Eidos Display, LLC et al v. AU Optronics Corporation et al, 6-11-cv-00201 (TXED June 21, 2017, Order) (Love, MJ)

Thursday, June 22, 2017

Failure to Timely Challenge Venue Before TC Heartland Waives Challenge Despite Reservation of Rights​

The court denied defendants' motion to transfer venue based on the recent Supreme Court decision in TC Heartland LLC v. Kraft Foods Group Brands LLC, 137 S. Ct. 1514 (2017), because defendants waived their objection to venue. "[N]either [defendant] affirmatively sought dismissal or transfer because of the lack of 'resid[ence]' or the lack of a 'regular and established place of business' under § 1400(b) as interpreted by [Fourco Glass Co. v. Transmirra Prod. Corp., 353 U.S. 222], until . . . less than two months from trial. . . .The Court need not reach Defendants’ argument that a change in law constitutes an exception to waiver under Rule 12(h)(1)(A) because the Supreme Court’s decision in TC Heartland does not qualify. . . . 'TC Heartland does not qualify for the intervening law exception to waiver because it merely affirms the viability of Fourco.' [One defendant] argues that Defendants 'each expressly reserved their rights to challenge venue in the event TC Heartland changed the law,' but a defendant cannot state that it does not dispute venue while reserving the ability to later contest it. To conclude otherwise would undermine the purpose of Rule 12(g) and (h) to promote efficiency and finality."

Elbit Systems Land and C4I Ltd. et al v. Hughes Network Systems LLC et al, 2-15-cv-00037 (TXED June 20, 2017, Order) (Payne, MJ)