In re: VTech Communications

NOTE: This order is nonprecedential.
United States Court of Appeals for the Federal Circuit
Miscellaneous Docket No. 909
IN RE VTECH COMMUNICATIONS, INC.
and VTECH TELECOMMUNICATIONS, LTD.,,
Petitioners.
On Petition for Writ of Mandamus to the United States District Court for the Eastern
District of Texas in case no. 5:07-CV-00171, Chief Judge David Folsom.
ON PETITION FOR WRIT OF MANDAMUS
Before MICHEL, Chief Judge, LINN and PROST, Circuit Judges.
LINN, Circuit Judge.
ORDER
VTech Communications et al. (VTech) petition for a writ of mandamus directing
the United States District Court for the Eastern District of Texas to vacate its orders
denying VTech’s motion to transfer venue, and to direct the court to transfer the case to
the United States District Court for the District of Oregon. Motorola, Inc. opposes.
VTech moves for leave to file a reply with reply attached. Motorola opposes.
This petition stems from a patent infringement suit filed in the Eastern District of
Texas by Motorola, a telecommunications company based in Illinois, against VTech, a
company domestically headquartered in Oregon, having significant foreign operations in
Hong Kong, and operating a research and development entity out of British Columbia.
VTech moved the Texas court to transfer the case to the District Court for the District of
Oregon pursuant to 28 U.S.C. §1404(a), which authorizes a change of venue “for the
convenience of parties and witnesses, in the interest of justice.”
Finding only the convenience of the witnesses factor to strongly favor transfer,
the district court held that VTech had not met its burden of demonstrating that the
Oregon district court was clearly more convenient. The trial court explained that
transfer would waste the time, energy, and money of the parties and the judicial system
because the court had become intimately familiar with the matter by completing claim
construction. The court also noted that although there were some sources of proof in
Oregon, there were sources of proof in Texas, Hong Kong, British Columbia and other
locations. The trial court also explained that despite more witnesses residing in Oregon
than Texas, the Oregon witnesses were party witnesses and could be compelled by
their employer to testify at trial. VTech filed this petition seeking a writ of mandamus to
vacate the trial court’s order and direct that the case be transferred to Oregon.
The use of mandamus power to correct an erroneous denial of transfer has been
approved under Fifth Circuit law, which applies here. See, e.g., In re Genentech, Inc.,
566 F.3d 1338 (Fed. Cir. 2009); In re TS Tech USA Corp., 551 F.3d 1315 (Fed. Cir.
2008); In re Volkswagen of Am., Inc., 545 F.3d 304 (5th Cir. 2008) (en banc) (granting
mandamus and directing the district court to transfer to a clearly more convenient
forum). Without mandamus, defendants such as VTech may be left with the inadequate
remedy of waiting until final judgment to correct indisputable errors. TS Tech, 551 F.3d
at 1322. With that said, however, mandamus relief in § 1404(a) cases is solely
reserved for circumstances where the petitioner can demonstrate that the denial of
transfer was a “clear” abuse of discretion such that refusing transfer produced a
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“patently erroneous result.” Volkswagen, 545 F.3d at 310. * A suggestion that the
district court abused its discretion, which might warrant reversal on a direct appeal, is
not a sufficient showing for mandamus relief. Id. Unless it is clear that the facts and
circumstances are without any basis for a judgment of discretion, we will not proceed
further in a mandamus petition to examine the district court’s decision. Volkswagen,
545 F.3d at 317 n.7 (citing McGraw-Edison Co. v. Van Pelt, 350 F.2d 361, 363 (8th Cir.
1965)). In other words, we will deny a petition “[i]f the facts and circumstances are
rationally capable of providing reasons for what the district court has done.”
Volkswagen, 545 F.3d at 317 n.7; see also In re Cordis Corp., 769 F.2d 733, 737 (Fed.
Cir. 1985) (noting that “if a rational and substantial legal argument can be made in
support of the rule in question, the case is not appropriate for mandamus”).
VTech takes issue with the trial court’s conclusion that transfer is improper
because of the trial court’s familiarity with the case and the completion of claim
construction. VTech contends that the familiarity is due solely to the trial court’s delay in
deciding the transfer motion, which VTech asserts is contrary to the Fifth Circuit’s ruling
in In re Horseshoe Entertainment, 337 F.3d 429 (5th Cir. 2003).
*
Under Fifth Circuit law, mandamus may issue only upon a showing that
the facts and circumstances underlying the district court’s application of the public and
private forum non conveniens factors1 are not rationally capable of providing reasons for
the district court’s decision, i.e., the district court reached a “patently erroneous” result
or committed a “clear” abuse of discretion. Volkswagen, 545 F.3d at 312. The “private”
interest factors include: (1) the relative ease of access to sources of proof; (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 a trial
easy, expeditious and inexpensive. Piper Aircraft Co. v. Reyno, 454 U.S. 235, 241 n.6
(1981). The “public” interest factors to be considered are: (1) the administrative
difficulties flowing from court congestion; (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 of unnecessary problems of conflicts of law or in the
application of foreign law. Volkswagen, 545 F.3d at 315.
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VTech's contention that the district court's familiarity with the case is of its own
doing is to no avail. It was incumbent upon VTech to actively and promptly pursue its
motion to transfer venue before the district court invested considerable time and
attention on discovery and completing claim construction.
Although there may have been some delay, we do not read Horseshoe as
precluding the district court from considering its investment and familiarity with the case
when determining the prudence of transfer. Horseshoe stands for the proposition that
vague generalities related to the possibility of delay caused by granting a transfer are
not proper considerations. Id. at 433-34. Contrastingly, the advanced stage of
discovery and the completion of claim construction are proper considerations that weigh
against transfer in the circumstances of this case.
VTech also contends that this case is like Genentech, in which we rejected the
district court’s central proximity rationale and instead directed the court to transfer to a
venue that was far more convenient for a substantial amount of the witnesses and
sources of proof. In Genentech, however, there was absolutely no relevant connection
between the case and the Eastern District of Texas. In this case, on the other hand, the
district court explained that there was at least one identified non-party witness who was
a resident of the Eastern District of Texas. Although VTech challenges the likelihood of
this witness actually testifying, Motorola has not ruled out calling the witness at trial. In
Genentech, there were no witnesses in Texas. Therefore, we cannot say that the
district court clearly and indisputably erred in considering this fact together with the fact
that it had completed claim construction and reached an advanced stage of discovery.
The district court also explained that VTech’s San Antonio, Texas distribution facility
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may likely contain relevant documents regarding the marketing of the accused products
and that some witnesses are closer to Texas than Oregon. In light of the particular
circumstances, the amount of work that the district court has already done on the case,
and the presence of an identified witness in the Eastern District of Texas, the facts are
rationally capable of providing reasons for what the district court has done.
Volkswagen, 545 F.3d at 317, n.7. Thus, VTech has not met the difficult burden to
obtain mandamus relief, which would interfere with the approaching trial date.
Accordingly,
IT IS ORDERED THAT:
(1) The petition is denied.
(2) The motion for leave to file a reply is granted.
FOR THE COURT
January 6, 2010 /s/ Jan Horbaly
Date Jan Horbaly
Clerk
cc: Timothy J. Malloy, Esq.
Jesse J. Jenner, Esq.
Judge, USDC E.D. Tex.
Clerk, USDC E.D. Tex.
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