Case: 22-130 Document: 11 Page: 1 Filed: 04/22/2022
NOTE: This order is nonprecedential.
United States Court of Appeals
for the Federal Circuit
______________________
In re: CANON INC., CANON U.S.A., INC.,
Petitioners
______________________
2022-130
______________________
On Petition for Writ of Mandamus to the United States
District Court for the Western District of Texas in No. 6:20-
cv-00980-ADA, Judge Alan D. Albright.
______________________
ON PETITION
______________________
Before DYK, REYNA, and CHEN, Circuit Judges.
DYK, Circuit Judge.
ORDER
Canon Inc. and Canon U.S.A., Inc. (“CUSA”) (collec-
tively, “Canon”) petition this court for a writ of mandamus
directing the United States District Court for the Western
District of Texas (“WDTX”) to transfer the case to the
United States District Court for the Eastern District of
New York (“EDNY”). We deny the petition.
BACKGROUND
WSOU Investments d/b/a Brazos Licensing and Devel-
opment (“Brazos”) filed this patent infringement lawsuit
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2 IN RE: CANON INC.
against Canon Inc. and CUSA in the Waco division of
WDTX alleging infringement of
U.S. Patent No. 7,054,346.
It is undisputed that Canon Inc. (a Japanese corporation)
is not provided venue protections in WDTX under
28 U.S.C.
§ 1400(b). See Brunette Mach. Works, Ltd. v. Kockum In-
dus., Inc.,
406 U.S. 706, 714 (1972). Brazos’s complaint
premises venue over CUSA (organized and run in New
York) in WDTX based on in-district home offices of CUSA
employees and in-district offices of its wholly-owned sub-
sidiary, Canon Solutions America, Inc.
Of particular significance here, Canon Inc. brought into
the action as a third-party defendant NXP USA, Inc.
(“NXP”) (an Austin-based company), alleging an obligation
to indemnify, defend, and hold harmless Canon Inc. based
on certain agreements relating to chips supplied by NXP
(and its predecessor-in-interest) and incorporated into the
accused products. NXP moved to sever the third-party
claims and for a separate trial, which was opposed by
Brazos and Canon Inc. 1 In its opposition to NXP’s motion,
Canon Inc. argued that “NXP provided [Canon Inc.] with
the very technology [Brazos] accuses of infringement,” ECF
No. 118 at 1, and that many of NXP’s contract defenses are
“inextricably intertwined” with Brazos’s underlying in-
fringement allegations. Id. at 5. Canon Inc. further argued
that it would be “severely prejudiced if its claim against
NXP [were to be] severed from the underlying action.” Id.
at 4. The district court agreed, denying NXP’s motion to
sever based on “the interests of judicial economy, stream-
lining discovery, and prejudice to [Brazos] and Canon
[Inc.].” ECF No. 128 at 11–12.
Canon moved to transfer to EDNY: CUSA moved under
28 U.S.C. §§ 1400(b), 1406(a) for improper venue, and both
CUSA and Canon Inc. moved under
28 U.S.C. § 1404(a) for
1 ECF citations are to the docket entries in WSOU
Invs. LLC v. Canon, Inc., No. 6:20-cv-980-ADA (W.D. Tex.).
Case: 22-130 Document: 11 Page: 3 Filed: 04/22/2022
IN RE: CANON INC. 3
transfer for convenience. On February 11, 2022, the court
denied Canon’s motion. The district court first determined
that the in-district home offices of CUSA employees did not
establish a “regular and established place of business”
within the meaning of § 1400(b), but agreed with Brazos
that Canon Solutions America, Inc. was an alter ego of
CUSA based on “blurring of corporate lines [ ] through the
commingling of the leadership, the office space, the location
of employees, and the products.” Appx 15–17. As a result,
the court concluded venue in WDTX was proper over
CUSA.
The district court then turned to Canon’s request to
transfer for convenience under § 1404(a). As to whether
EDNY is a district where the patent infringement claims
“might have been brought,” the court agreed with Canon
that it was a proper forum. Appx 18; see Appx 74 (“Because
[Canon Inc.] is a foreign corporation and CUSA is head-
quartered in EDNY, this suit could have been brought in
EDNY.”). No party addressed the relevance of the third-
party claims against NXP to that threshold requirement
for transfer, and the district court assumed those claims
would remain in WDTX. See Appx 28–29 (“[T]he third-
party action against NXP remains in this Court . . . .”); see
also ECF No. 99 at 3 (NXP Motion to Sever: “[T]here is no
dispute that venue for the indemnity claim should be de-
cided in the Western District of Texas . . . .”).
Having concluded that EDNY would be a proper forum
for litigating the patent infringement claims, the district
court next evaluated the private and public interest fac-
tors. Relying, in part, on the location of NXP’s headquar-
ters in the district and its relevance to the patent
infringement action, the court determined that the factors
of court congestion, local resolution of local interests, and
practical problems weighed against transfer. On the other
hand, the court determined that the convenience of willing
witnesses weighed in favor of transferring the litigation to
EDNY. The court determined that the remaining factors
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4 IN RE: CANON INC.
favored neither forum. Appx 18–32. On balance, the court
determined that Canon had not shown EDNY to be clearly
more convenient than WDTX and denied transfer.
After transfer was denied, Canon filed this petition.
For transfer under § 1406, CUSA argues the district court
clearly erred by lowering the alter ego standard for estab-
lishing patent venue, solely relying on a typical parent-sub-
sidiary relationship without identifying evidence of any
“plus factor,” such as undercapitalization. Pet. at 23 (quot-
ing Licea v. Curacao Drydock Co., Inc.,
952 F.3d 207, 213
(5th Cir. 2015)). For transfer under § 1404, Canon argues
the district court clearly erred in its evaluation of certain
factors and the correct analysis shows EDNY to be a clearly
more convenient forum than WDTX.
We have jurisdiction pursuant to
28 U.S.C. § 1651(a)
and
28 U.S.C. § 1295(a)(1).
DISCUSSION
“[A]ll courts established by Act of Congress may issue
all writs necessary or appropriate in aid of their respective
jurisdictions and agreeable to the usages and principles of
law.”
28 U.S.C. § 1651(a). “As the writ [of mandamus] is
one of the most potent weapons in the judicial arsenal,
three conditions must be satisfied before it may issue.”
Cheney v. U.S. Dist. Ct. for D.C.,
542 U.S. 367, 380 (2004)
(internal quotation marks and citations omitted). First,
the petitioner must show there to be “no other adequate
means to attain the relief he desires,” which “ensure[s] that
the writ will not be used as a substitute for the regular ap-
peals process.”
Id. at 380–81. Second, the petitioner must
show that its “right to issuance of the writ is clear and in-
disputable.”
Id. at 381 (internal quotation marks and cita-
tion omitted). Finally, “the issuing court, in the exercise of
its discretion, must be satisfied that the writ is appropriate
under the circumstances.”
Id.
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IN RE: CANON INC. 5
I.
We first address the district court’s denial of CUSA’s
motion to transfer under
28 U.S.C. §§ 1400(b), 1406(a) for
improper patent venue, which is reviewed under Federal
Circuit law. In re ZTE (USA) Inc.,
890 F.3d 1008, 1013–14
(Fed. Cir. 2018). “Ordinarily, mandamus relief is not avail-
able for rulings on [improper venue] motions under
28
U.S.C. § 1406(a)” because postjudgment appeal is often an
adequate alternative means for attaining relief. In re
Volkswagen Grp. of Am., Inc.,
28 F.4th 1203, 1207 (Fed.
Cir. Mar. 9, 2022) (“Volkswagen III”) (citing In re HTC
Corp.,
889 F.3d 1349, 1352–53 (Fed. Cir. 2018)).
Although we have recognized certain “narrow circum-
stances” where immediate judicial intervention by way of
mandamus review of an improper venue determination is
nonetheless appropriate, such as when there are a “signif-
icant number of district court decisions that adopt conflict-
ing views on the basic legal issues presented in the case,”
Volkswagen III, 28 F.4th at 1207 (cleaned up), CUSA has
not made such a showing. CUSA argues that the district
court erroneously failed to hold Brazos to an appropriately
exacting burden to establish Canon Solutions America, Inc.
as an alter ego of CUSA. But CUSA does not point to dis-
agreement among a significant number of district courts on
this issue that might warrant this court’s immediate re-
view. At most, CUSA’s arguments suggest that the district
court’s decision is an outlier capable of postjudgment re-
view. We accordingly conclude that Canon has failed to
show entitlement to the extraordinary remedy of manda-
mus on this ground.
II.
We now turn to the district court’s denial of Canon’s
motion to transfer to a more convenient forum under
28
U.S.C. § 1404(a), which is reviewed under regional circuit
law. In re Samsung Elecs. Co.,
2 F.4th 1371, 1375 (Fed.
Cir. 2021). Unlike venue decisions, it is well settled that
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6 IN RE: CANON INC.
mandamus review of orders resolving motions for transfer
under section 1404(a) is appropriate because a postjudg-
ment appeal is not an adequate remedy. See In re TS Tech
Corp.,
551 F.3d 1315, 1322 (Fed. Cir. 2008); In re
Volkswagen of Am., Inc.,
545 F.3d 304, 318–19 (5th Cir.
2008) (en banc) (“Volkswagen II”). However, we conclude
that, in this case, Canon has failed to show a clear and in-
disputable right to transfer to EDNY.
“The preliminary question under § 1404(a) is whether
a civil action ‘might have been brought’ in the destination
[forum].” Volkswagen II, 545 F.3d at 312. As the § 1404
movant, Canon bore the burden of demonstrating that the
transferee forum, EDNY, is a district where the “civil ac-
tion” “might have been brought.” See In re Medtronic, Inc.,
No. 2022-107,
2021 WL 6112980, at *3 (Fed. Cir. 2021) (cit-
ing Volkswagen II, 545 F.3d at 314).
Here, the district court agreed with Canon that the pa-
tent infringement claims against it “might have been
brought” in EDNY, but Canon has clarified in its petition
that it “moved to transfer the entire ‘case,’” “which neces-
sarily includes [its] third-party claims” against NXP. Pet.
at 25–26 (citation omitted). Canon’s argument is con-
sistent with its defeat of NXP’s motion to sever, but Canon
did not address whether the entire “civil action,” including
its claims against NXP, “might have been brought” in
EDNY. In fact, Canon’s motion to transfer did not mention
NXP and its reply brief in support of that motion did not
identify any connection between NXP and EDNY. The dis-
trict court’s decision is similarly devoid of an apparent con-
nection between NXP and EDNY: NXP is headquartered in
Austin, it is incorporated in Delaware, and the relevant
agreements are governed by California law. Appx 2; ECF
No. 128 at 2, 4; see also Pet. at 28, 35 (arguing that there is
a general lack of record evidence regarding the location of
relevant NXP activities).
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IN RE: CANON INC. 7
Nor has Canon shown a clear and indisputable right to
disregard NXP, as a third-party defendant, from all aspects
of § 1404(a)’s “might have been brought” analysis. The
Fifth Circuit has evaluated the contacts of third-party de-
fendants with the transferee forum, see In re Volkswagen
AG,
371 F.3d 201, 203 (5th Cir. 2004) (“Volkswagen I”) (re-
viewing third-party defendants’ relationship to transferee
forum); Volkswagen II, 545 F.3d at 307 (noting third-party
defendant lived in transferee district); see also Blue Spike,
LLC v. Tex. Instruments, Inc., No. 12-cv-499,
2014 WL
11858192, at *3 (E.D. Tex. Mar. 18, 2014) (“The movants
bear the burden of establishing [that the civil action ‘might
have been brought’ against] all defendants—including
third-party Defendants—in the transferee forum”), and
has opined that a “third-party defendant is protected
against an inconvenient forum . . . by the requirement that
the court have personal jurisdiction over him,” Gundle Lin-
ing Constr. Corp. v. Adams Cnty. Asphalt, Inc.,
85 F.3d 201,
209–10 (5th Cir. 1996) (internal quotation marks and cita-
tion omitted). Canon has identified no contrary authority.
Canon notes in the petition that NXP did not oppose its
motion to transfer, but that is not so clear, see ECF No. 99
at 3 (NXP Motion to Sever: “[T]here is no dispute that
venue for the indemnity claim should be decided in the
Western District of Texas . . . .”), and, in any event, we can-
not see how that would alter the outcome. The Supreme
Court in Hoffman v. Blaski,
363 U.S. 335, 344 (1960) held
long ago that the “might have been brought” analysis looks
to whether “the plaintiff has a right to sue [in the trans-
feree forum,] . . . independent[] of the wishes of defendant.”
And while Congress has since expanded § 1404(a) to allow
a district court to transfer a civil action alternatively to
“any district or division to which all parties have con-
sented,” Brazos has not consented to having the action
transferred to EDNY.
Finally, “courts may sever defendants for purposes of
transfer,” In re Nintendo of Am., Inc.,
756 F.3d 1363, 1364
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8 IN RE: CANON INC.
(Fed. Cir. 2014), but “we look with extreme disfavor,” Po-
lara Eng’g Inc. v. Campbell Co.,
894 F.3d 1339, 1352 (Fed.
Cir. 2018) (citation omitted), on Canon’s suggestion that
the third-party claims in this case can be severed to effec-
tuate transfer. See Pet. at 26 n. 4; Reply at 10 n.1. Canon
now characterizes NXP as “a mere third party,” Pet. at 34,
involved in “an ancillary third-party claim seeking indem-
nity,” Pet. at 26 (citation omitted), but it took the opposite
position before the district court to successfully defeat
NXP’s motion to sever. See, e.g., ECF No. 118 at 1 (“NXP
is not an insurer whose only obligation and relevance in
this case is to provide payment to [Canon Inc.] to cover a
liability.” (internal quotation marks omitted));
id. at 5
(“[Canon Inc.] will be severely prejudiced if its claim
against NXP is severed from the underlying action.”). Tak-
ing Canon at its own word, it would be improper to grant
mandamus to order severance.
Accordingly,
IT IS ORDERED THAT:
The petition is denied.
FOR THE COURT
April 22, 2022 /s/ Peter R. Marksteiner
Date Peter R. Marksteiner
Clerk of Court
