STMicroelectronics Inc v. Sandisk Corporation, No. 4:05-cv-00044 (E.D. Tex. Apr. 27, 2005)

Before the Court is Defendant’s Motion to Transfer (Docket #23). Having considered motion, Plaintiff’s response, and Defendant’s reply, the Court is of the opinion that Defendant’s Motion to Transfer should be denied.

This is a patent infringement case relating to “ flash memory” chips and related products. Plaintiff, a Delaw are corporation w ith its principal place of business in Carrollton, Texas accuses Defendant, a Delaw are corporation w ith its principal place of business in Sunnyvale, California, of infringing U.S. Patent No. 4,592,802 (" ' 802 patent" ), ow ned by Plaintiff.

The relationship betw een the parties began on April 16, 2004, w hen Plaintiff’s vice president, Lisa Jorgenson, sent a letter to Defendant’s CEO, Eli Harari, requesting a meeting to discuss the possibility of a broad cross-license agreement. Harari responded w ith a letter indicating that Defendant w ould need time to review the patents listed by Jorgenson, but w ould be in touch w ithin a few w eeks. After no meeting w as scheduled, Jorgenson sent a second letter on July 12, 2004, reiterating her request for a meeting to begin licensing discussions. Defendant’s chief intellectual property counsel responded and invited Jorgenson to attend a meeting on August 5, 2004 in California. On August2 27, 2004, the parties met again in Texas. Negotiations continued through September and early October, and on October 15, 2004, Defendant filed an action against Plaintiff in the Northern District of California claiming infringement of one patent and seeking a declaration that fourteen of Plaintiff’s patents w ere invalid and not infringed. The action w as dismissed for lack of subject matter jurisdiction, w hich dismissal is currently being appealed by Defendant.

Plaintiff filed the present action on February 4, 2005, alleging infringement of the ' 802 patent. On the same day, Plaintiff filed suit in the Eastern District of Texas alleging infringement of six other patents, three of w hich w ere at issue in the previously mentioned California litigation. Defendant filed another action against Plaintiff in the Northern District of California on March 28, 2005, but the ' 802 patent is not at issue in that action. Defendant now moves the Court to transfer the present action to the Northern District of California.

When the selected venue for an action is proper, a motion to transfer venue from one district or division to another is governed by 28 U.S.C. § 1404(a), w hich provides that “ [f]or the convenience of parties and w itnesses, in the interest of justice, a district court may transfer any civil action to any other district or division w here it might have been brought.” 28 U.S.C. § 1404(a); see In re Volksw agen AG, 371 F.3d 201, 203 (5th Cir. 2004); Action Indus., Inc. v. United States Fid. & Guar. Co., 358 F.3d 337, 340 (5th Cir. 2004); In re Horseshoe Entm’t, 337 F.3d 429, 433 (5th Cir.), cert. denied, 124 S. Ct. 826 (2003); Casarez v. Burlington Northern/Santa Fe Co., 193 F.3d 334, 339 (5th Cir. 1999); Hanby v. Shell Oil Co., 144 F. Supp. 2d 673, 676 (E.D. Tex. 2001). The3 purpose of this statute “ is to prevent the w aste of time, energy, and money, and to protect litigants, w itnesses, and the public against unnecessary inconvenience and expense.” Van Dusen v. Barrack, 376 U.S. 612, 616 (1964); Shoemake v. Union Pac. R.R. Co., 233 F. Supp. 2d 828, 829 (E.D. Tex. 2002).

Under § 1404(a), the movant has the burden of demonstrating that a change of venue is w arranted. See Peteet v. Dow Chem. Co., 868 F.2d 1428, 1436 (5th Cir.), cert. denied, 493 U.S. 935 (1989); Time, Inc. v. Manning, 366 F.2d 690, 698 (5th Cir. 1966); Shoemake, 233 F. Supp. 2d at 829; LeDoux v. Isle of Capri Casinos, Inc., 218 F. Supp. 2d 835, 837 (E.D. Tex. 2002); Hanby, 144 F. Supp. 2d at 676. In order to prevail, the moving party must demonstrate that the balance of convenience and justice w eighs heavily in favor of a transfer of venue. See Shoemake, 233 F. Supp. 2d at 829; Mohamed v. Mazda Motor Corp., 90 F. Supp. 2d 757, 768 (E.D. Tex. 2000). Thus, the Court, w hen analyzing the merits of a 1404(a) motion, must determine if a transfer w ould make litigation of the case substantially more convenient for the parties. See Gardipee v. Petroleum Helicopters, Inc., 49 F. Supp. 2d 925, 928 (E.D. Tex. 1999).

The decision to grant or deny a motion to transfer is committed to the sound discretion of the district court. See Van Dusen, 376 U.S. at 616; Volksw agen, 371 F.3d at 203; Casarez, 193 F.3d at 339; Peteet, 868 F.2d at 1436; Balaw ajder v. Scott, 160 F.3d 1066, 1067 (5th Cir. 1998), cert. denied, 526 U.S. 1157 (1999); Shoemake, 233 F. Supp. 2d at 830; LeDoux, 218 F. Supp. 2d at 836. “ [T]he trial court must exercise its discretion in light of the particular circumstances of the case.” Hanby, 144 F. Supp. 2d at 676 (citing Radio Santa Fe v. Sena, 687 F. Supp. 284, 287 (E.D. Tex. 1988));4 accord Shoemake, 233 F. Supp. 2d at 829; Robertson v. Kiamichi R.R. Co., L.L.C., 42 F. Supp. 2d 651, 655 (E.D. Tex. 1999).

In applying the provisions of 1404(a), the Court must first examine w hether the judicial district to w hich the transfer is sought w ould have been a district in w hich the claim could have been properly filed. In re Horeshoe, 337 F.3d at 433; Volksw agon, 371 F.3d at 203. The Court finds that, based upon the pleadings, the Northern District of California is an appropriate forum. Defendant, a Delaw are corporation, has its principal place of business in Sunnyville, California, w ithin the Northern District of California. See 28 U.S.C. §§ 1391(b)(1)&(c), 1400(b). Furthermore, it appears that the alleged infringing products w ere sold all around the country, including in the Northern District of California, thus rendering venue proper in that district. See 28 U.S.C. 1400(b).

If jurisdiction is proper in the district to w hich transfer is sought, the first step in a 1404(a) analysis is to determine w hich forum best caters to the convenience of the parties and w itness. “ The determination of convenience turns on a number of private and public interest factors, none of w hich are given dispositive w eight.” Volksw agon, 371 F.3d at 203 (citations omitted). “ The private concerns include: (1) the relative ease of access to sources of proof; (2) the availability of compulsory process to secure the attendance of w itnesses; (3) the cost of attendance for w illing w itnesses; and (4) all other practical problems that make trial of a case easy, expeditious, and inexpensive.” Id.

The first factor is the relative ease of access to sources of proof. Neither party seems to take serious issue w ith the location of documentary evidence, and w hile the5 Court considers the location of documentary evidence in its analysis, the Court is more concerned w ith the location of key w itnesses, as the relative convenience of the w itnesses is often recognized as the most important factor to be considered w hen ruling on a motion under § 1404(a). See Isbell v. DM Records, Inc., 2004 WL 1243153, at * 14 (N.D. Tex. June 4, 2004); LeDoux, 218 F. Supp. 2d at 837. Defendant argues that many key w itnesses are located in the Northern District of California. Defendant has provided the names of certain of its employee w itnesses w ho may testify and briefly listed topics about w hich such employees are know ledgeable. Although the convenience of employee w itnesses, w hose attendance may be compelled by their employer, is entitled to less w eight than the convenience of other w itnesses, the Court gives the convenience of such w itnesses its due consideration. See AMS Staff Leasing v. Starving Students, Inc., 2003 WL 21436476, at * 3 (N.D. Tex. June 18, 2003); Cont’l Airlines, Inc. v. Am. Airlines, Inc., 805 F. Supp. 1392, 1397 (S.D. Tex. 1992). Plaintiff has identified a number of w itnesses located nearby in the Northern District of Texas, and both parties claim to have w itnesses w ho w ill travel from other continents. Therefore, as to the issue of convenience of w itnesses, the Court determines “ it’s a draw .”

The Court next considers the availability of compulsory process to secure the attendance of non-party w itnesses. Neither party has specifically identified non-party w itnesses w ho w ill be called to testify. The Court thus considers this to be a neutral factor w eighing in favor of neither venue.

As to the cost of attendance for w illing w itnesses, the Court does not envision this to be a factor w eighing in favor of either party. Whether the case remains in the Eastern6 District of Texas or is transferred to the Northern District of California, the Court realizes that one party’s w itnesses w ill be more significantly burdened than the other party’s w itnesses. As a transfer w ould merely result in a mere shifting of burdens, the Court finds this to be a neutral factor. See Gardipee v. Petroleum Helicopters, Inc., 49 F. Supp. 2d 925, 929-30 (E.D. Tex. 1999).

The Court also considers private factors such as the Plaintiff’s choice of forum and the convenience of the parties. See Fletcher v. S. Pac. Transp. Co., 648 F. Supp. 1400 (E.D. Tex. 1986). While Plaintiff’s choice of forum is no longer accorded the decisive w eight that it enjoyed under forum non conveniens, the choice of forum is clearly a factor to be considered, though it is neither decisive nor determinative. See Piper Aircraft Co. v. Reyno 454 U.S. 235, 253-56; Radio Santa Fe, Inc. v. Sena, 687 F. Supp. 284, 287 (E.D. Tex. 1988); In re Horeshoe Entm’t, 337 F.3d at 434; see Shoemake, 233 F. Supp. 2d at 830-31. How ever, the Plaintiff’s choice of forum is “ given less w eight w hen the Plaintiff brings suit outside its home district.” Isbell, 2004 WL 1243153 at * 13; Hanby v. Shell Oil Co., 144 F. Supp. 2d 673, 677 (E.D. Tex. 2001).

While Plaintiff argues that its office is located w ithin four miles of the Eastern District of Texas, the Court notes that its office is nonetheless located in the Northern District of Texas. The choice of forum w ould have been more persuasive if Plaintiff had chosen its home district, the Northern District of Texas. And w hile the Court acknow ledges that the Eastern district is an appropriate venue, as alleged infringing products w ere sold here, the Court also notes that this factor is of reduced significance w here, as here, the alleged infringing products w ere sold in virtually every district in the7 country.

The Court finds the convenience of the parties to be a factor w eighing in favor of neither venue. Whether the case is tried in California or Texas, one party w ill have to travel significant distances and pay for lodging and travel expenses. The Court w ill not transfer venue based upon a factor that w ill merely result in a shifting of burdens. See Gardipee, 49 F. Supp. 2d at 930.

“ The public concerns include: (1) the administrative difficulties flow ing from court congestion; (2) the local interest in having localized interests decided at home; (3) the familiarity of the forum w ith the law that w ill govern the case; and (4) the avoidance of unnecessary problems of conflict of law s of the application of foreign law .” Volksw agon 371 F.3d at 203. The first factor likely w eighs in Plaintiff’s favor. Statistics maintained by the Administrative Office of the United States Courts reflect that in 2004, there w ere 373 cases pending in the Eastern District of Texas per judgeship and 519 cases pending in the Northern District of California per judgeship. FEDERA L COURT MGM T. STA TISTICS: DISTRICT COURTS (2004), at http://w w w .uscourts.gov/cgi-bin/cmsd2004.pl. Furthermore, the median time from filing to trial w as seven months longer for civil cases in the Northern District of California than in the Eastern District of Texas. Id. Thus, despite the Eastern District of Texas’ heavy criminal caseload, it is likely that the present controversy w ill be resolved more quickly in the Eastern District of Texas than in the Northern District of California.

The second public factor is the interest of the citizens of the district. Citizens of the Northern District of California have an interest in the resolution of this matter.8 According to Defendant, all of the alleged infringing products w ere designed and developed w ithin the Northern District of California or overseas. Plaintiff only alleges that certain products w ere marketed and sold in the Eastern District of Texas, but, as noted above, such argument is of reduced significance w hen the products at issue w ere marketed and sold in virtually every district nationw ide. Furthermore, Plaintiff apparently has offices w ithin the Northern District of California. As Plaintiff is not even a resident of the Eastern District of Texas, the Court finds that this factor w eighs in Defendant’s favor.

Under these facts, the Court considers the third and fourth public interest factors to be of little significance. Both forums are very familiar w ith federal law , and conflict of law s is simply not an issue.

In this instance, the Defendant struck first. How ever, its preemptive strike w as thw arted by a finding that there w as no justiciable controversy. Now the Plaintiff has filed suit. Defendant does not challenge Plaintiff’s case or venue choice on a motion to dismiss, but on a discretionary motion to transfer. Although some factors w eigh in favor of venue in the Northern District of California, Defendant has not met its heavy burden. Therefore, in consideration of the above listed factors, the Court is of the opinion that the case should remain in the Eastern District of Texas.

IT IS THEREFORE ORDERED that Defendant’s Motion to Transfer is DENIED.