In Re Emc Corp. , 501 F. App'x 973 ( 2013 )

Case: 13-142 Document: 32 Page: 1 Filed: 01/29/2013
NOTE: This order is nonprecedential.
United States Court of Appeals
for the Federal Circuit
______________________
IN RE EMC CORP., DECHO CORP., IOMEGA
CORP., AND CARBONITE, INC.,
Petitioners.
_____________________
Miscellaneous Docket No. 142
______________________
On Petition for Writ of Mandamus to the United States
District Court for the Eastern District of Texas in case no.
10-CV-0435, Magistrate Judge Amos L. Mazzant.
______________________
ON PETITION
______________________
Before RADER, Chief Judge, DYK, and MOORE, Circuit
Judges.
DYK, Circuit Judge.
ORDER
This is petitioners EMC Corporation, Decho Corpora-
tion, Iomega Corporation and Carbonite Corporation’s
second request for a writ of mandamus in this case; as we
noted before, this matter arose out of a single complaint
filed by respondent Oasis Research LLC (“Oasis”) charg-
ing a total of eighteen companies with offering online
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2 IN RE EMC CORP
backup and storage for home or business computer users
that allegedly infringed its patents. In re EMC Corp., 677
F.3d 1351 (Fed. Cir. 2012). The United States District
Court for the Eastern District of Texas denied EMC and
Carbonite’s requests to sever the claims against them in
separate motions filed shortly after the complaint. In its
view, Rule 20 of the Federal Rules of Civil Procedure—
which governs joinder of claims arising out of the same
transaction or occurrence—was met because the defen-
dants’ accused services and products were “not dramati-
cally different.” Oasis Research LLC v. ADrive LLC, No.
4:10-CV-435, 2011 WL 3099885, at *2 (E.D. Tex. May 23,
2011). Given its conclusion that all eighteen claims
belonged in the same action, the district court also denied
EMC and Carbonite’s motions to transfer venue to the
United States District Courts for the Districts of Utah
and Massachusetts, respectively, on the ground that
transfer would divide a single action into several “differ-
ent lawsuits scattered across the country.” Id. at *4.
On petition this court reversed. We held that claims
against independent defendants cannot be joined under
the transaction-or-occurrence test “unless the facts under-
lying the claim of infringement asserted against each
defendant share an aggregate of operative facts.” EMC,
677 F.3d at 1359. Because application of the improper
joinder test could preclude a proper transfer analysis and
prevent the defendants from having a “meaningful oppor-
tunity to present individualized defenses on issues such
as infringement, willfulness, and damages,” we granted
the petition to the limited extent that we directed the
district court to apply the correct test. Id. at 1354-55. We
did not express any opinion on the issue of transfer of
venue.
After our opinion, the district court severed the mat-
ter into four separate cases, including creating a separate
Case: 13-142 Document: 32 Page: 3 Filed: 01/29/2013
IN RE EMC CORP 3
action against Carbonite and a separate action against
EMC, Decho, and Iomega, consolidated the cases for pre-
trial proceedings, and again denied the petitioners’ mo-
tions for transfer in separate orders. In its denial of
transfer orders, the district court concluded that in each
case the petitioners had failed to show that the transferee
venues were clearly more convenient. In so finding, the
district court acknowledged that at least one party in each
case had maintained significant operations relating to an
accused product in the transferee venues and that the
petitioners had identified five potential witnesses who
reside in Utah and two potential witnesses who reside in
Massachusetts. However, the court concluded that the
petitioners had not met their burden of demonstrating the
need for transfer, particularly in light of the fact that
some potential witnesses were located in or closer to the
Eastern District of Texas, and several witnesses and
sources of proof were located in various other states,
including New York, Virginia, Colorado, and Washington,
D.C. The district court, moreover, concluded in each case
that judicial economy weighed heavily against transfer.
In that regard, the district court noted that if it were to
transfer the cases other courts “would have to spend
significant resources to familiarize [themselves] with the
patents, prosecution history, claim construction, and
other issues in th[ese] case[s].” Taking particular issue
with that analysis, the petitioners now seek a writ of
mandamus with regard to those orders.
The petitioners’ request for a writ directing the dis-
trict court to transfer these cases runs up against a highly
deferential standard of review. The question before us on
mandamus is not whether the transferee venues are more
convenient and fair; nor is it even whether in our view it
was an abuse of discretion for the trial court to have
denied transfer, which is the applicable standard of
review on direct appeal. See In re TS Tech USA Corp.,
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4 IN RE EMC CORP
551 F.3d 1315, 1319 (Fed. Cir. 2008). Instead, the ques-
tion is whether the denial of transfer was such a “‘clear’
abuse of discretion” that refusing transfer would produce
a “patently erroneous result.” Id. (quoting In re Volks-
wagen of Am., Inc., 545 F.3d 304, 310 (5th Cir. 2008) (en
banc)). Under this highly deferential standard, we must
leave the district court’s decision undisturbed unless it is
clear “that the facts and circumstances are without any
basis for a judgment of discretion.” Volkswagen, 545 F.3d
at 317 n.7 (quoting McGraw-Edison Co. v. Van Pelt, 350
F.2d 361, 363 (8th Cir. 1965)). Here, we cannot say that
standard has been met.
This case is a prime example of the importance of ad-
dressing motions to transfer at the outset of litigation. As
the Fifth Circuit stated in In re Horseshoe Entm’t, “in our
view disposition of [a] motion [to transfer] should have
taken a top priority in the handling of this case by the . . .
District Court. 1 ” 337 F.3d 429, 433 (5th Cir. 2003).
Congress’ intent “to prevent the waste of time, energy and
money and to protect litigants, witnesses and the public
against unnecessary inconvenience and expense,” Van
Dusen v. Barrack, 376 U.S. 612, 616 (1964) (internal
quotation marks omitted), may be thwarted where, as
here, defendants must partake in years of litigation prior
to a determination on a transfer motion.
1 Similarly, the Third Circuit has concluded that
“[j]udicial economy requires that [a] district court should
not burden itself with the merits of the action until it is
decided [whether] a transfer should be effected” and thus
“it is not proper to postpone consideration of the applica-
tion for transfer under § 1404(a) until discovery on the
merits is completed.” McDonnell Douglas Corp. v. Polin,
429 F.2d 30, 30 (3d Cir. 1970).
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IN RE EMC CORP 5
Here, the district court based its denial of the peti-
tioners’ motions to transfer venue in part on considera-
tions of judicial economy. Petitioners protest that there is
no “legitimate judicial economy factor” here because the
district court’s familiarity with the case arises only from
its earlier error in refusing to sever and transfer claims
against them. Petition at 11. Petitioners are correct that
the district court could not properly rely on judicial econ-
omy involved in retaining the very cases that were the
subject of the transfer motion. Motions to transfer venue
are to be decided based on “the situation which existed
when suit was instituted.” Hoffman v. Blaski, 363 U.S.
335, 343 (1960) (quoting Paramount Pictures, Inc. v.
Rodney, 186 F.2d 111, 119 (3d Cir. 1950) (Hastie, J.,
dissenting)). Any subsequent familiarity gained by the
district court is therefore irrelevant.
It does not follow, however, that the district court’s
judicial economy rationale was wholly misplaced. While
considerations of judicial economy arising after the filing
of a suit do not weigh against transfer, a district court
may properly consider any judicial economy benefits
which would have been apparent at the time the suit was
filed. For example, we have held that a district court’s
experience with a patent in prior litigation and the co-
pendency of cases involving the same patent are permis-
sible considerations in ruling on a motion to transfer
venue. In re Vistaprint, Ltd., 628 F.3d 1342, 1346-47 &
n.3 (Fed. Cir. 2010). The latter consideration is applicable
here. The district court could properly consider the
benefits to judicial economy arising from having the same
judge handle both Oasis’s suits against the petitioners
and Oasis’s suits against other parties involving the same
patents and technology as to which there was no issue of
transfer. Petitioners complain that Oasis’s claims against
other defendants have since been dismissed, but, as
discussed above, the relevant inquiry is the state of affairs
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6 IN RE EMC CORP
at the time “when suit was instituted.” Hoffman, 363
U.S. at 343. Because the dismissal of Oasis’s suits as to
the other defendants occurred later, it is not relevant to
the venue inquiry. Accordingly, the district court could
properly conclude that considerations of judicial economy
favored retention of the cases.
To be clear, we are not suggesting that the judicial
economy of having the same judge handle multiple suits
involving the same patents should dominate the transfer
inquiry. After all, the MultiDistrict Litigation Procedures
exist to effectuate this sort of efficiency. Here, the peti-
tioners concede that the district court considered all of the
other relevant interest factors in reaching the conclusion
that the transferee venues were not clearly more conven-
ient for trial than the Eastern District of Texas. See
Petition at 9. The district court found not only that
judicial economy weighed against transfer, but also that a
significant number of identified potential sources of proof
and witnesses are located outside of the transferee ven-
ues, including at least one witness in Carbonite’s case and
two witnesses in EMC’s case who reside in the Eastern
District of Texas. Given these facts, we cannot say that,
on the whole, the district court’s determination as to
transfer was so unreasonable as to warrant mandamus
relief.
Accordingly,
(1) The petition for a writ of mandamus is denied.
(2) The motion for a stay is denied as moot.
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IN RE EMC CORP 7
FOR THE COURT
/s/ Jan Horbaly
Jan Horbaly
Clerk
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