Opinion
CIVIL ACTION NO: 02-2055, SECTION: "R"(2)
October 4, 2002
ORDER AND REASONS
Before the Court is defendant's motion to transfer pursuant to 28 U.S.C. § 1404(a). For the following reasons, the Court denies defendant's request to transfer this lawsuit to the Central District of California.
I. Background
Plaintiff, Jam Strait, Inc., and defendant, American Products Company, Inc., ("APC") both sell aftermarket accessories for automobiles. Plaintiff asserts that its President, Bruce Wesson, invented a kind of LED automotive bulb in 1999 and assigned his interest in the invention to Jam Strait in May of 2000. Jam Strait began manufacturing and selling the invention in 2000, always labeling the product "patent pending" or "patents pending." Plaintiff asserts that despite these labels numerous manufacturers and distributors, including APC, have copied the invention. The United States Patent and Trademark Office issued a patent to assignee Jam Strait on April 16, 2002. On July 3, 2002, Jam Strait filed suit in this Court alleging that APC infringed upon this patent.
Before answering Jam Strait's complaint, APC filed a parallel complaint in the Central District of California seeking a declaration of non-infringement and alleging various state law causes of action. Soon thereafter, APC answered plaintiff's complaint before this Court, brought counterclaims nearly identical to those it introduced in the parallel lawsuit, and moved this Court to transfer this lawsuit to the Central District of California. APC asserts that Brian Horowitz, APC's founder and CEO, conceived APC's automotive LED replacement bulbs in 1999.
II. Discussion
This Court has jurisdiction over plaintiff's complaint for patent infringement pursuant to 28 U.S.C. § 1331 and 1338(a). Venue is proper pursuant to 28 U.S.C. § 1391(c) and 1400(b) because APC is doing business and is deemed to reside in this district. Defendant nevertheless moves the Court to transfer this lawsuit pursuant to § 1404(a), which provides as follows:
"For the convenience of parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought."28 U.S.C. § 1404(a). Plaintiff concedes that it could have brought this lawsuit in the Central District of California. See 28 U.S.C. § 1391(c). Therefore, the question facing this Court is whether transfer is convenient for the parties and witnesses and in the interest of justice.
The defendant bears the burden of demonstrating why the case should be transferred to an alternate forum. See Time, Inc. v. Manning, 366 F.2d 690, 698 (5th Cir. 1966). Because the decision to transfer requires an "`individualized, case-by-case consideration of convenience and fairness,'" such a decision ultimately falls within the district court's sound discretion. Stewart Organization, Inc. v. Ricoh Corporation, 487 U.S. 22, 29, 108 S.Ct. 2239, 2244 (1988) (quoting Van Dusen v. Barrack, 376 U.S. 612, 622, 84 S.Ct. 805, 812 (1964)); see also Peteet v. Dow Chemical Co., 868 F.2d 1428, 1436 (5th Cir. 1989). In deciding whether to transfer a case pursuant to § 1404(a), courts consider the private and public interest factors articulated by the Supreme Court in Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 508, 67 S.Ct. 839, 843 (1947). Private factors relate to the convenience of the litigants and include: (1) the plaintiff's choice of forum; (2) the relative ease of access to sources of proof; (3) the cost of obtaining attendance of witnesses and other trial expenses; (4) the place of the alleged wrong; and (5) the possibility of delay and prejudice if transfer is granted. Id. Public interest factors, on the other hand, include (1) the administrative difficulties resulting from court congestion; (2) the relationship to the litigation of the community from which jurors will be drawn; (3) the local interest in having localized controversies decided at home; and (4) choice of law issues. Id. "[U]nless the balance is strongly in favor of the defendant, the plaintiff's choice of forum should rarely be disturbed." Id.; see also Peteet, 868 F.2d at 1436.
Defendant asserts that private factors weigh in favor of transfer. First, defendant asserts that plaintiff's choice of forum is not entitled to deference because Jam Strait did not select the forum closest to its corporate headquarters. Although headquartered in Newton, Mississippi, plaintiff chose to file this lawsuit 200 miles away in the Eastern District of Louisiana. Although plaintiff's choice of forum is "neither conclusive nor determinative," it is nevertheless "clearly a factor to be considered." In re Horseshoe Entertainment, 2002 WL 31012809, *5 (5th Cir. 2002). It remains a factor to be considered even though plaintiff did not select what might appear to be its most convenient forum. Indeed, courts recognize that when a "plaintiff has not brought suit on its `home turf,' the convenience to the plaintiff of litigating in its chosen forum is not as great as it would be were it litigating at or near its principal place of business," meaning that "the quantum of inconvenience to defendant needed to tip the balance in favor of transfer is concomitantly reduced." Sports Eye, Inc. v. Daily Racing Form, Inc., 565 F. Supp. 634, 637 (D.Del. 1983) (internal citations omitted). Accordingly, the Court now turns to a consideration of convenience.
APC asserts that California is more convenient for the parties since APC's business records are kept there, and a key non-party witness, Mark Rogers, resides nearby. Rogers worked for APC in 1999 and participated in the development of the APC automotive LED bulbs in dispute. Rogers is subject to subpoena in the Central District of California, but not in Louisiana. APC has its only place of business in Corona, California, which is located 20 miles from the courthouse of the Central District of California located in Riverside, California. It is therefore clear that the California venue is more convenient for APC. But it is equally clear that the Louisiana venue is more convenient for Jam Strait. Jam Strait's principal place of business is located 200 miles away from the Louisiana venue, but 2,000 miles away from the California venue. The former is a reasonable drive; the latter requires flying halfway across the country. Jam Strait's business records, including documents pertaining to its patent application, are within a reasonable driving distance of the Louisiana venue. The same is true for many of Jam Strait's witnesses, most notably Bruce Wesson, President of Jam Strait and inventor of Jam Strait's LED bulbs. Other potential Jam Strait witnesses that reside within a reasonable drive of the Louisiana venue are Dr. Gordon Baird and Mr. Seth Nehrbass, the patent attorneys who prepared Jam Strait's patent application, and Herman Shields, Jam Strait's exclusive marketing representative.
Plaintiff's attorneys are located in Metairie, Louisiana, which is within the Eastern District of Louisiana. The Fifth Circuit recently held, however, that location of counsel is "irrelevant and improper for consideration." See Horseshoe, 2002 WL 31012809, at *5.
Jam Strait may also call as a witness Jeff Bendit, the General Manager of a company that showcased a proto-type of the invention in October 1999. Bendit resides in Colombus, Ohio. Although Ohio is closer to Louisiana than it is to California, both trips require lengthy flights. Therefore, the Court cannot conclude that Louisiana is a substantially more convenient forum for Bendit.
While it is true that a Mississippi venue would appear to be more convenient to Jam Strait than the Louisiana venue it selected, it is equally true that the Louisiana venue is substantially more convenient to plaintiff than the California venue urged by defendant. The Court finds that transferring this litigation to California would merely shift the expense and inconvenience of the litigation from defendant to plaintiff. See Johnson v. Tuff N Rumble Management, Inc., 1999 WL 1201891, *10 (E.D.La. 1999). Therefore, the Court does not find that transfer is more convenient to the parties and witnesses.
Defendant points out that a parallel lawsuit is currently pending in the Central District of California. This lawsuit, however, was filed by APC after Jam Strait filed suit before this Court. The general rule, of course, is that the winner of the "race to the courthouse" is entitled to a presumption in favor of his or her choice of forum. See Cadle Company v. Whataburger of Alice, Inc., 174 F.3d 599, 603 (5th Cir. 1999). This holds true in patent infringement suits where, as here, a defendant charged with patent infringement attempts to proceed by selecting a more convenient forum in which to litigate a declaration of noninfringement. See Kerotest Mfg. Co. v. C-O-Two Fire Equipment Co., 342 U.S. 180, 185, 72 S.Ct. 219, 222 (1952). Thus, the pendency of APC's lawsuit in the Central District of California, which remains in its early stages, does not persuade the Court that transfer is in the interest of justice.
Last, defendant asserts that "the preferred forum for an infringement claim is in the district where the alleged infringement occurred." Lencco Racing Co., Inc. v. Arctco, Inc., 953 F. Supp. 69, 71 (W.D.N.Y. 1997). Even assuming this to be true, it is not a dispositive factor. In Lencco, for example, the court granted the defendant's motion to transfer from New York to Michigan for a number of reasons: all of the relevant documents were in Michigan, nearly all of the party witnesses were in Michigan, the case load of the Michigan courts was lower, and the infringement occurred in Michigan. Id. Here, the alleged infringement occurred in California and in Taiwan. This militates in favor of transfer. But each of the other factors, most notably the location of business records and the location of witnesses, indicate that transfer is inappropriate. Further, plaintiff's choice of forum, even after taking into consideration the decision to file outside of its "home turf," weighs against transfer.
Jam Strait asserts that the infringement also occurred in Louisiana, as APC sold its product here. If a defendant's goods are sold in many states, however, "sales alone are not enough to establish a material connection to the forum and override the other factors favoring transfer." Lennco, 953 F. Supp. at 73.
Defendant has therefore failed to carry its burden of establishing that transfer is more convenient for the parties and witnesses and in the interest of justice. The pendency of APC's parallel proceeding does not warrant, and certainly does not compel, transfer. Accordingly, the Court denies defendant's motion.
III. Conclusion
For the foregoing reasons, the Court denies defendant's motion to transfer.