In Re Katz Interactive Call Processing Patent Litigation , 481 F. Supp. 2d 1353 ( 2007 )

481 F.Supp.2d 1353 (2007)

In re KATZ INTERACTIVE CALL PROCESSING PATENT LITIGATION

No. MDL-1816.

Judicial Panel on Multidistrict Litigation.

March 20, 2007.

Before WM. TERRELL HODGES,^[*] Chairman, D. LOWELL JENSEN,^[*] J. FREDERICK MOTZ,^[*] ROBERT L. MILLER, Jr., KATHRYN H. VRATIL DAVID R. HANSEN and ANTHONY J. SCIRICA, Judges of the Panel.

TRANSFER ORDER

MILLER, Acting Chairman.

This litigation presently consists of the 25 actions listed on Schedule A and pending in two districts as follows: twenty actions in the Eastern District of Texas and five actions in the District of Delaware. The patents involved in these actions relate to the integration of telephone systems with computer databases and/or live operator call centers to provide "interactive call processing" or "interactive voice response." Now before the Panel are two motions, pursuant to 28 U.S.C. § 1407, seeking centralization of all or a subset of these 25 actions.^[1]

In the first motion, the Target defendants^[2] seek centralization under Section 1407 of all actions in the Central District of California before Judge R. Gary Klausner, who has judicial experience with several patents involved in these MDL-1816 actions. Eleven groups of affiliated defendants support the motion; some of these defendants alternatively suggest selection of either the District of Delaware or the Eastern District of Texas as transferee district. The patent holder plaintiff Ronald A. Katz Technology Licensing, L.P. (RAKTL) opposes centralization. If the Panel deems centralization appropriate, RAKTL opposes inclusion of the Texas Citibank action in Section 1407 proceedings, but RAKTL supports selection of either the Texas or Delaware districts as transferee forum for the remaining actions. Twelve groups of affiliated defendants also oppose centralization; if the Panel deems centralization appropriate, some of these defendants oppose inclusion of the Texas Citibank and Discover actions in any MDL-1816 proceedings and/or alternatively support centralization in one of the three suggested transferee fora.

In the second motion, a defendant in one Texas action, Global Crossing Telecommunications, Inc. (Global Crossing), seeks centralization of only two MDL-1816 actions — the "teleconferencing" actions now pending respectively in the District of Delaware and Eastern District of Texas — and any other actions the Panel deems necessary, in the District of Delaware. Global Crossing alternatively supports centralization of all actions in the Central District of California. One Texas co-defendant joins in this motion. Plaintiff RAKTL and eleven groups of affiliated Delaware or Texas defendants also oppose this second motion.

On the basis of the papers filed and hearing session held, the Panel finds that the actions in this litigation involve common questions of fact and that centralization in the Central District of California will serve the convenience of the parties and witnesses and promote the just and efficient conduct of the litigation. Each of the 25 MDL-1816 actions involves allegations of infringement and invalidity of one or more interactive call processing patents, sometimes referred to as the "Katz family of patents" (after the last name of the inventor of the patents). All actions can thus be expected to share factual and legal questions concerning such matters as the technology underlying the patents, prior art, claim construction and/or issues of infringement involving the patents. Centralization under Section 1407 is necessary in order to eliminate duplicative discovery, prevent inconsistent pretrial rulings, and conserve the resources of the parties, their counsel and the judiciary.

Opponents argue that unique questions of fact relating to each defendant's allegedly infringing system will predominate over common factual questions among these actions. We are not persuaded by this argument. Transfer under Section 1407 does not require a complete identity or even a majority of common factual or legal issues as a prerequisite to transfer. Centralization will permit all actions to proceed before a single transferee judge who can structure pretrial proceedings to consider, all parties' legitimate discovery needs, while ensuring that common parties and witnesses are not subjected to duplicative discovery demands. The transferee court will be able to formulate a pretrial program that allows any unique discovery in these actions to proceed concurrently on separate tracks with discovery on common issues, In re Joseph F. Smith Patent Litigation, 407 F.Supp. 1403, 1404 (Jud.Pan. Mult.Lit.1976). The Panel is also aware that proceedings in some MDL-1816 actions are further advanced than other actions. It may well be that some actions may be ready for trial in advance of other MDL-1816 actions. If such is the case, nothing in the nature of this Section 1407 centralization will impede the transferee court, whenever it deems appropriate, from recommending Section 1407 remand. See Rule 7.6, R.P.J.P.M.L., 199 F.R.D. at 436-38; In re Acacia Media Technologies Corp. Patent Litigation, 360 F.Supp.2d 1377 (J.P.M.L.2005).

While any of the suggested districts would be an appropriate transferee district for this litigation, we are persuaded that this litigation should be centralized in the Central District of California before Judge Klausner, who has prior judicial experience with some of the patents involved in this docket, and is thus already familiar with the technology underlying these patents.

IT IS THEREFORE ORDERED that, pursuant to 28 U.S.C. § 1407, the actions listed on Schedule A are transferred to the Central District of California and, with the consent of that court, assigned to the Honorable R. Gary Klausner for coordinated or consolidated pretrial proceedings.

SCHEDULE A

MDL-1816 — In re Katz Interactive Call Processing Patent Litigation

District of Delaware

Ronald A. Katz Technology Licensing, LP v. Reliant Energy Inc., et al., C.A. No. 1:06-543

Ronald A. Katz Technology Licensing, LP v. TD Banknorth, Inc., et al., C.A. No. 1:06-544

Ronald A. Katz Technology Licensing, LP v. Ahold USA, Inc., et al., C.A. No. 1:06-545

Ronald A. Katz Technology Licensing, LP v. Time Warner Cable, Inc., et al., CA. No. 1:06-546

Ronald A. Katz Technology Licensing, LP v. American International Group, Inc., et al., CA. No. 1:06-547

Eastern District of Texas

Ronald A. Katz Technology Licensing, LP v. American Airlines, Inc., et al., C.A. No. 2:06-334

Ronald A Katz Technology Licensing, LP v. Aetna, Inc., et al., E.D. Texas, CA. No. 2:06-335

Ronald A. Katz Technology Licensing, LP v. Citibank, N.A., et al., C.A. NO. 5:05-142

Ronald A. Katz Technology Licensing, LP v. Discover Financial Services, Inc., et al., C.A. No. 5:06-182

Ronald A. Katz Technology Licensing, LP v. Genesys Conferencing, Inc., et al., C.A. No. 5:06-187

Ronald A. Katz Technology Licensing, LP v. American Electric Power Co., Inc., et al., C.A. No. 5:06-188

Ronald A Katz Technology Licensing, LP v. Alltel Corp., et al., CA. No. 9:06-177

Ronald A. Katz Technology Licensing, LP v. Chevron Corp., et al., C.A. No. 9:06-178

Ronald A. Katz Technology Licensing, LP v. Cox Communications, Inc., et al., C.A. No. 9:06-191

Ronald A. Katz Technology Licensing, LP v. DirecTV Group, Inc., et al., CA. No. 9:06-192

Ronald A. Katz Technology Licensing, LP v. Earthlink, Inc., CA. No. 9:06-193

Ronald A. Katz Technology Licensing, LP v. Tracfone Wireless, Inc., CA. No. 9:06-194

Ronald A Katz Technology Licensing, LP v. Ford Motor Co., et al., CA. No. 9:06-195

Ronald A. Katz Technology Licensing, LP v. Cullen/Frost Bankers, Inc., et al., C.A. No. 9:06-196

Ronald A. Katz Technology Licensing, LP v. General Electric Capital Corp., et al., C.A. No. 9:06-197

Ronald A Katz Technology Licensing, LP v. General Motors Corp., et al., CA No. 9:06-198

Ronald A. Katz Technology Licensing, LP v. Humana, Inc., C.A. No. 9:06-199

Ronald A. Katz Technology Licensing, LP v. Regions Financial Corp., et al., CA. No. 9:06-201

Ronald A Katz Technology Licensing, LP v. Safeco Insurance Co. of America, et al., C.A. No. 9:06-202

Ronald A. Katz Technology Licensing, LP v. U.S. Bancorp, et al., C.A. No. 9:06-203

NOTES

[*] Judges Hodges, Jensen and Motz took no part in the decision of this matter.

[1] An additional action — Ronald A. Katz Technology Licensing, LP v. PNC Financial Services Group, Inc., et al., E.D. Texas, C.A. No. 9:06-200 — was included on the initial Section 1407 motion. The Panel has been notified that this action has been settled and dismissed. Accordingly, the question of inclusion of this action in MDL-1816 proceedings is moot.

The Panel also has been notified that a potentially related action has been filed in the District of Delaware. In light of the Panel's disposition of this docket, this action will be treated as a potential tag-along action. See Rules 7.4 and 7.5, R.P.J.P.M.L., 199 F.R.D. 425, 435-36 (2001).

[2] Target Corp., Target Bank, and Target National Bank.