Venue in the Eastern District of Texas (Updated)
Since I posted here on the shift of patent infringement case filings away from the Eastern District of Texas, the Federal Circuit has issued another decision reversing a denial of a motion to transfer venue in a patent case in the Eastern District of Texas (EDTex). See In re Genentech, Misc. Dock. No. 901, 2009 U.S. App. LEXIS 10882 (Fed. Cir. May 22, 2009).
Genentech rejects several grounds cited in recent EDTex decisions denying transfer.
- First, the Court rejected the rationale that the location of witnesses favors transfer only if transfer is more convenient for all witnesses. Many post-TS Tech decisions in the EDTex have routinely rejected transfer if the plaintiff could identify relevant witnesses who lived far away from both Texas and the transferee forum.
In Genentech, fourteen witnesses lived in California, the proposed transferee forum, while the six inventors lived in Europe, a prior art witness lived in Iowa and four of the patent prosecuting attorneys lived on the East Coast. The Federal Circuit held that the District Court had placed too much emphasis on the additional distance that the European witnesses would have to travel to go to California rather than Texas.
Thus, the Court soundly rejected the rationale that “Texas must be more convenient because it’s in the middle of the country” found in several EDTex decisions. Rather, where material witnesses reside in the transferee forum and no witnesses reside in the EDTex, it is clear error to find that the convenience of witnesses weighs against transfer.
- The Federal Circuit also faulted the EDTex for requiring a showing that the witnesses in the transferee forum were “key witnesses.” Since they had relevant information, “it was not necessary for the district court to evaluate the significance of the identified witnesses’ testimony.”
Two other holdings in Genentech will also weigh in favor of transfer in future cases.
- First, despite the storage of most documents electronically, the Court found that it was clear error to discount the burden to transport documents from California to Texas.
- Second, the Court held that it was clear error to consider Genentech’s filing of an unrelated patent infringement suit in Texas in the decision to deny transfer.
One common basis for denying transfer post–TS Tech remains available – the presence of multiple defendants in different forums. In Genentech, both defendants were located in California (though they were in two different court districts). Where defendants are in multiple forums, or where there are relevant defense witnesses in multiple forums, transfer will remain difficult in the EDTex.
