Opinion
04-CV-629 (ARR)(ASC).
July 19, 2004
David Toren, Sidley Austin Brown Wood LL, New York, NY Counsel for plaintiffs.
Peter D. Murray Wendy E. Miller, CooperDunham LLP, New York, NY Counsel for Defendant.
OPINION AND ORDER
Plaintiffs Hilti Aktiengesellschaft ("HAG") and Hilti, Inc. ("Hilti") filed this action seeking a declaratory judgment regarding their non-infringement under federal trademark law, 15 U.S.C. § 1051 et seq., of defendant Milwaukee Electric Tool Corporation's claimed trade dress mark on February 13, 2004. By motion dated April 30, 2004, defendant moves to transfer venue to the Northern District of Mississippi pursuant to 28 U.S.C. § 1404(a). For the reasons stated below, defendant's motion is granted.
BACKGROUND
For purposes of this order, familiarity with the relevant facts is assumed and they will be only briefly recited here. Plaintiff HAG, a corporation organized under the laws of Lichtenstein and with its corporate headquarters there, manufactures power tools. Plaintiff Hilti is an Oklahoma corporation with its principal place of business in Tulsa; it is the sole U.S. distributor and seller of HAG's products and manufactures some such products under license. Defendant, also a tool manufacturer, is a Delaware corporation whose chief corporate officers are stationed in Brookfield, Wisconsin; as discussed in greater detail infra, it maintains that its principal place of business is in Mississippi.
Defendant's power tools have long been predominantly red in color with gray and/or black accents and defendant argues that its use of these colors has, since at least 1969, constituted an inherently distinctive trade dress (the "color combination mark."). Plaintiffs claim that their predominantly red, black-accented powder-actuated tools and power tools have been marketed in this country for over forty-five years (that is, since at least 1959), and that their color scheme constitutes a color combination mark. The instant dispute arose when, in 1999, defendant filed applications for trademark registrations for color marks including red with black and/or gray accents. Plaintiffs and at least one other competitor have opposed this registration before the Trademark Trial and Appeal Board ("the TTAB").
Correspondence submitted by plaintiffs shows that as of April, 2000, defendant's parent company, Atlas Copco, and plaintiff HAG had been in negotiation for at least several months in an attempt to find an "amicable solution" to defendant's perception that Hilti and HAG's products infringed its color combination mark.See Decl. of Kelly Beaver, May 21, 2004, Ex.2, at 1. Defendant was concerned in particular that plaintiff's "recent" practice of direct retail sales to the public at large through Home Depot stores threatened to create consumer confusion, even if its prior sales to professional customers did not. Defendant notified plaintiffs that if no amicable solution could be reached, it would "take whatever steps are necessary" to protect its claimed trademark rights. Id. at 2. The negotiations included four meetings, one of which took place in New York at defendant's counsel's office (located within the Southern District) and the balance of which were in Chicago. The negotiations were fruitless and ceased in October, 2002.
On January 6 of this year, defendant sued another competitor, the Robert Bosch Tool Corp., in the Northern District of Mississippi ("the Northern District" or "the proposed transferee court."). That action is currently pending in the Greenville Division before the Hon. W. Allen Pepper, Jr. In that action defendant brings claims for unfair competition, false designation of origin, and infringement of its color combination mark and for trademark dilution, as well as pendent state claims. As the complaint in that action makes clear, the basis of these claims is defendant's alleged protectible interest in its color combination mark. See Decl. of Wendy E. Miller, Esq., Apr. 30, 2004, Ex. A, ¶¶ 6-18; 37; 39. Defendant alleges that Bosch "recently" began to make and market tools infringing on its color combination mark. Id. ¶ 21. The TTAB has stayed action on the protests to defendant's trademark application pending resolution of that suit.
On February 13, 2004, plaintiffs filed this declaratory judgment action, seeking (1) a declaration that they have not infringed on defendant's trademark because it has no exclusive trademark ownership rights in the alleged color combination mark, and (2) injunctive relief barring defendants from interfering with plaintiffs' distribution and sale of their goods. (Compl. ¶ 27.)
DISCUSSION
Section 1404(a) of Title 28 provides that "[f]or the convenience of the parties and witnesses, in the interests 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). The goal of the provision "is to prevent 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). The statute "reposes considerable discretion in the district court to adjudicate motions for transfer according to an 'individualized, case-by-case consideration of convenience and fairness.'" Red Bull Associates v. Best Western Intern., Inc., 862 F.2d 963, 967 (2d Cir. 1988) (quoting Stewart Org., Inc. v. Ricoh Corp., 487 U.S. 22, 29 (1988) (further internal quotation omitted)). "In determining whether to transfer venue, courts examine: (1) whether the action could have been brought in the proposed transferee forum; and (2) whether the transfer would promote the convenience of parties and witnesses and would be in the interests of justice." MasterCard International, Inc. v. Lexcel Solutions, Inc., No. 03-CV-7157, 2004 WL 1368299, *6 (S.D.N.Y. June 16, 2004); see also James W. Moore, et al., 17Moore's Federal Practice § 111.11 (3d ed. 2003).
A. Whether the action could have been brought in the Northern District of Mississippi
Plaintiffs object that the Northern District of Mississippi lacks personal jurisdiction over plaintiff HAG under a constitutional "minimum contacts" analysis, and that transfer to that district is therefore improper under § 1404(a) because the lawsuit could not have been brought there. This argument is baseless. The question is not whether plaintiffs could be haled into the proposed transferee court as defendants, but whether plaintiffs could have brought the same declaratory judgment action in the transferee court. Hoffman v. Blaski, 363 U.S. 335, 344 (1960).
The party seeking transfer has the burden of establishing that the case could be brought in the transferee district. Volkswagen de Mexico, S.A. v. Germanischer Lloyd, 768 F.Supp. 1023, 1028-29 (S.D.N.Y. 1991); 17 Moore's Federal Practice § 111.12[3]. Defendant asserts in its moving papers that venue would be proper in that district "because a substantial part of the events or omissions giving rise to the claims occurred there" in that defendant maintains manufacturing and distribution operations within the district and plaintiff Hilti sells some of its allegedly infringing products there. (Def. Mem. at 8; see also Def. Reply Mem. at 3 ("Plaintiff clearly could have brought the present action against [defendant] in Mississippi in view of [defendant's] substantial presence in Mississippi.").) While it is far from clear that the manufacture and distribution of defendant's products in the proposed transferee district is an "event or omission" giving rise to plaintiff's claim for a declaration of the non-infringing nature of its own products, the sale of some of plaintiffs' products within the Northern District makes venue technically proper under § 1391(b)(2). See generally Fugazi Int'l Travel Group v. Fugazy Exec. Travel, No. 00-CV-5927, 2001 WL 50936 (S.D.N.Y. Jan. 22, 2001) (noting general rule that "[i]n trademark infringement cases, the focus of the venue inquiry is on the identification of districts in which the consumer deception occurred" and that they "often may be laid in a broad range of districts, as infringing material often is broadly disseminated"; collecting cases).
Defendant repeatedly asserts that venue is proper under 28 U.S.C. § 1391 (a), which governs actions brought on diversity grounds exclusively. See id. (specifying districts where a "civil action wherein jurisdiction is founded only on diversity of citizenship" may be brought) (emphasis added). Plaintiffs' declaratory judgment action raises questions of federal law. The error is of no importance since the relevant standard under the correct provision, 28 U.S.C. § 1391(b)(2), is identical.
Defendant must show not only that venue is proper in the proposed transferee district but that if the suit were commenced there the transferee court would have personal jurisdiction over it. Hoffman, 363 U.S. at 344; Anglo American Ins. Group, PLC v. Calfed, Inc., 916 F. Supp. 1324, 1330 (S.D.N.Y. 1996). Personal jurisdiction over the defendant must exist as a matter of law independent of the defendant's voluntary amenability to suit there. Hoffman, 363 U.S. at 343-44; Reina v. Morgan Drive Away Inc., No. 94-CV-6495, 1995 WL 66585, *1 (S.D.N.Y. Feb. 15, 1995). In a federal question case such as this one, personal jurisdiction is limited both by the familiar constitutional due process requirement of a sufficient nexus between the defendant and the forum and by the strictures of Fed.R.Civ.P. 4, which requires a "basis for the defendant's amenability to service of summons." Omni Capital International Co. v. Rudolf Wolff Co. Ltd., 484 U.S. 97, 104 (1987).
Rule 4(f) allows for service of process either within the forum district court's home state or outside of that state as provided by statute or by the Federal Rules themselves. Where the defendant is a corporation, Rule 4(h) provides that service may be effected upon a duly, designated agent for service of process or as provided in Rule 4(e)(1), which in turn refers to the forum state's rules for service in its own courts of general jurisdiction. Defendant has put forward evidence, in affidavit form, of its extensive manufacturing and distribution centers in the proposed transferee district. (Declaration of Harry E. Peterson, Apr. 27, 2004, at ¶¶ 4-13, 17, 19.) Under Mississippi law, such activity indubitably constitutes the "transact[ion] of business" requiring a certificate of authority from the Secretary of State, and the issuance of such a certificate is conditioned on the maintenance at all times of an agent for service of process within the state. Miss. Code Ann. §§ 79-4-15.01(a), 15.10 (West 2004); see also Wiley Electric Co. of Jackson et al. v. Electric Storage Battery Co., 147 So. 773, 777 (Miss. 1933) (warehousing of products in-state by foreign corporation for redistribution constitutes "doing business" under then-applicable statute). While defendant has failed to introduce any specific evidence on this point, it is likely that defendant has obtained a certificate of authority as required and ipso facto has an agent duly authorized to receive service of process within the state. Defendant has thus made the prima facie showing of personal jurisdiction that the law of the proposed transferee district requires. See WNS, Inc. v. Farrow, 884 F.2d 200, 203 (5th Cir. 1989) (where court decides whether personal jurisdiction is established based on paper record, only prima facie evidence is required and inferences should be drawn favorably to the party seeking to establish jurisdiction).
The court is aware of no federal statute that would allow for nationwide service in this case. Thus to be amenable to service of process defendant must either be able to be served within the forum state, see Alpha Tau Omega Fraternity v. Pure Country, Inc., 185 F.Supp. 2d 951, 956 (S.D.Ind. 2002) ("the Lanham Act does not prescribe nationwide service of process"), or must be within the reach of the state's long-arm statute as provided in Rule 4(e)(1).
B. Whether transfer promotes convenience and justice
Defendant, as the moving party, bears the burden of establishing by clear and convincing evidence that transfer is appropriate. Excelsior Designs, Inc. v. Sheres, 291 F.Supp. 2d 181, 185 (E.D.N.Y. 2003). In analyzing whether transfer is warranted, courts consider factors including: (1) the convenience of the parties; (2) relative means of the parties; (3) the convenience of the witnesses; (4) where the operative facts occurred and the relative ease of access of to sources of proof; (5) the availability of process to compel the attendance of unwilling witnesses; (6) the plaintiff's choice of forum; (7) the forums' relative degree of familiarity with the governing law; (8) trial calendar congestion; and (9) trial efficiency and the interests of justice. MasterCard International, Inc. v. Lexcel Solutions, Inc., No. 03-CV-7157, 2004 WL 1368299, *6 (S.D.N.Y. June 16, 2004); United States Fidelity Guar. Co. v. Republic Drug Co., Inc., 800 F.Supp. 1076, 1080 (E.D.N.Y. 1992). "There is no rigid formula for balancing these factors and no single one of them is determinative." Citigroup, Inc. v. City Holding Co., 97 F.Supp. 2d 549, 561 (S.D.N.Y. 2000). In this case, very few of the factors weigh heavily in favor of one venue or the other. Those few that are not neutral weigh in favor of transfer to the Northern District of Mississippi.
1. Convenience of the parties
Neither party maintains a significant corporate presence in New York. Defendant, a Delaware corporation headquartered in Wisconsin, argues that Mississippi is more convenient because its most extensive manufacturing and distribution operations and the majority of its employees are located there. Defendant argues that a "significant number" of its party-representatives would not have to travel were this suit to be transferred there. While defendant does not specify how many party-representatives would come from the transferee district and how many would come from its Wisconsin headquarters, this factor weighs in favor of transfer, since no party-representatives on either side are stationed in or near this district. See Republic Drug, 800 F.Supp. at 1080 (where plaintiff would have to travel to either forum, convenience to defendant weighs in favor of transfer).
The parties vigorously dispute what legal test should govern the determination of defendant's "principal place of business," citing to authority relating not to venue analysis but to the quite different question of determining diversity of parties for the purpose of establishing subject matter jurisdiction. See, e.g., J.A. Olson Co. v. City of Winona, Miss., 818 F.2d 401, 412 (5th Cir. 1987); Pinnacle Consultants, Ltd. v. Leucadia Nat. Corp., 923 F.Supp. 439, 448 (S.D.N.Y. 1995) (noting that competing tests for "that single location where a corporation carries out its central purpose" are designed to fulfill the "express intent of Congress [to] . . . reduce the case load of the federal courts and to remedy abuses of diversity jurisdiction."). For purposes of deciding which is the more appropriate venue, the fact of defendant's extensive business operations in the transferee district may be relevant whether or not, as a matter of law, those operations entail that the transferee district hosts its "principal place of business" for diversity purposes. See Republic Drug, 800 F.Supp. at 1080 (noting that location of satellite offices is relevant to venue determination because those offices "may play an important part in the trial of this action" though principal place of business is elsewhere).
2. Relative Means of Parties
The parties agree that their means are comparable and that this factor is therefore neutral.
3. Convenience of the witnesses
Defendant asserts that five of the eight witnesses it presently anticipates calling at trial are located in Mississippi, and the other three in Wisconsin. Four of the five Mississippi witnesses are managers of assembly or distribution plants, and one is a vice president of operations. The five are all expected to testify to the "manufacture and sale" of Milwaukee products bearing the alleged color mark; two will testify as to quality control; and one will testify as to distribution. Two of the plant managers are believed to have knowledge of manufacture, sale, and distribution dating back at least 25 years. The three Wisconsin witnesses, executives in marketing and engineering, are expected to testify to sales, marketing, and distribution of the products; competitor use of color combinations; the history of advertising the products; and their engineering. One of the three witnesses is believed to have knowledge of defendant's use of its alleged color mark and sales of its products going back 30 years.
It is evident that the five Mississippi witnesses' expected testimony will overlap to a large extent and will be partly cumulative of testimony provided by Wisconsin witnesses. To the extent that witness testimony overlaps or is duplicative, the court should regard the witnesses for balancing purposes as one witness. NBA Properties, Inc. v. Salvino, Inc., No. 99-CV-11799, 2000 WL 323257, *2-3 (S.D.N.Y. Mar. 27, 2000). It is also clear that the Mississippi witnesses' non-cumulative testimony — about the manufacture and quality control of defendant's product since roughly 1979 — is far less material to the instant dispute than the testimony of the Wisconsin executives regarding the marketing, advertising, manufacture and sale of these products over a longer period and their engineering. In order to defeat plaintiffs' claim that defendant has no protectible interest in the color mark, defendant will have to show that its use of the alleged color mark is not functional and that it has acquired a "secondary meaning" as that term is used in trademark law.Qualitex Co. v. Jacobson Products Co., 514 U.S. 159, 163, 165 (1995). For this purpose, testimony regarding the marketing and advertising of the product, competitors' use of color, and the general volume and distribution of retail sales is far more relevant than testimony regarding their manufacture and quality control. See generally Bristol-Myers Squibb Co. v. McNeil-P.P.C., Inc., 973 F.2d 1033, 1041 (2d Cir. 1992) ("Among the factors that we have found relevant to [secondary meaning] inquiry in the past are advertising expenditures, consumer studies, sales success, unsolicited media coverage, attempts to plagiarize and length and exclusivity of use."). The Mississippi witnesses thus add comparatively little, and the court should discount them in its balancing analysis. American Alliance Ins. Co. v. Sunbeam Corp., No. 98-4703, 1999 WL 38183, *6 (S.D.N.Y. Jan. 28, 1999) ("In determining whether to grant a transfer motion, it is well-established that the court must look beyond the quantity of witnesses and assess the quality of the testimony to be offered." (collecting cases)); 17 Moore's Federal Practice § 111.13[1][f][v] (witness convenience should be weighed in proportion to materiality of the testimony).
Plaintiffs, for their part, anticipate that their key witnesses, executives who have knowledge of the advertising, promotion and marketing of Hilti tools, will travel from Lichtenstein. One witness, a district manager in New York, can testify to the long use by Hilti of its color mark and to the sales, marketing and distribution of the tools in the United States. Another witness who resides in Tulsa, Oklahoma, has "extensive" knowledge of the same information regarding use of the color mark dating back to 1971; for the reasons discussed above, this makes that portion of the New York witness' testimony irrelevant to the analysis. An employee from Massachusetts can testify as to the distribution of Hilti tools through the Home Depot retail channel.
Discounting the duplicative and less material testimony of defendant's Mississippi witnesses and plaintiffs' New York witness, each party has at best one witness residing in or near its preferred venue. With or without a transfer, it is plain that the most central witnesses for both parties — all employees — will have to travel a significant distance. The parties have submitted conflicting evidence regarding the comparative cost and time involved in travel from the various corporate headquarters to this district and to Mississippi. As noted above, the parties concede that their means are comparable; the court does not find it useful to compare the relative cost and inconvenience in increments of half-hours and tens of dollars based on ever-shifting airline schedules and fares. Cf. Effron v. Sun Line Cruises, Inc., 67 F.3d 7, 10 (2d Cir. 1995) ("In recent years, the courts of this circuit have emphasized that [a] forum is not necessarily inconvenient because of its distance from pertinent parties or places if it is readily accessible in a few hours of air travel.") (internal quotation omitted). Because key witnesses in roughly equal numbers will have to travel to either venue, this factor is neutral.
4. Locus of Operative Fact and Access to Sources of Proof
As noted above, the key decisions regarding the design, advertising and marketing of each brand were made in neither this district nor the proposed transferee district, but at the respective corporate headquarters in Wisconsin and Tulsa and/or Lichtenstein. The foundation for venue in this district, as plaintiffs concede, is the sale of allegedly non-infringing products here. In 2003 plaintiffs' sales in New York City represented some 1.6% of total U.S. sales, an unknown portion of which took place in this district. Its sales in Mississippi constituted roughly 0.34% (again, there is no information particular to the relevant district). Defendant concedes that venue here is proper, but it is proper on the same basis in the Northern District. Where the plaintiff has selected venue that bears at best a de minimis relation to the subject of the suit, it should not be heard to complain that another district with a similarly minimal connection on the same grounds is inappropriate. Fugazi, 2001 WL 50936 at *1 ("trademark infringement cases . . . often may be laid in a broad range of districts, as infringing material often is broadly disseminated"; collecting cases); Toy Biz, Inc. v. Centuri Corp., 990 F.Supp. 328, 331 (S.D.N.Y. 1998) (where alleged infringing products were sold nationally, including in New York, Southern District of New York had "significant connection" with trademark infringement dispute (collecting cases)); cf. 5 McCarthy on Trademarks and Unfair Competition § 32:65 n. 15 (4th ed. 2002) (hereinafter "McCarthy") (under pre-1990 version of venue statute, sales equaling 2% or less of national sales in chosen venue considered insufficient to support venue (collecting cases)). The court finds the 'locus of operative fact' factor neutral as between this district and the Northern District of Mississippi.
Plaintiff's additional arguments that the operative facts occurred here because (a) one meeting relating to the instant dispute took place at counsel's office in the Southern District of New York, and (b) plaintiff Hilti was formerly headquartered near this district and has employees, outlets and distribution centers in the region — the great majority of them apparently outside of this district — do not merit further discussion.
Defendant also argues that roughly 34,000 documents relating to its marketing, advertising, sale, shipping and inspection of its goods "have already been copied, numbered and located in Mississippi for the Bosch litigation." While it is unclear how many of these documents would actually be needed in the instant litigation, or that it would be unduly burdensome to reproduce and ship further copies of those that were needed, see Distefano v. Carozzi North America, Inc., No. 98-CV-7137, 2002 WL 31640476, *4 (E.D.N.Y. Nov. 16, 2002), there is no indication that any relevant documentary evidence or business records are located within this district. This factor therefore slightly favors transfer.
5. Unwilling witnesses
Neither party contends that unwilling witnesses' testimony may have to be procured by subpoena. This factor is neutral.
6. Plaintiff's choice of forum
The plaintiff's choice of forum is ordinarily given significant weight and is disturbed only if the balance of convenience and justice weigh heavily in favor of defendant's proposed forum.Toy Biz, Inc., 990 F.Supp. 328 at 330 (collecting cases); 17Moore's § 111.13[c][i] n. 7. The weight given to a plaintiff's choice is greatly diminished, however, where the plaintiff does not reside in the chosen forum and/or where significant operative events did not occur there. Cali v. East Coast Aviation Services, Ltd., 178 F. Supp. 2d 276, 292 (E.D.N.Y. 2001); Republic Drug, 800 F. Supp. at 1082; 17Moore's § 111.13[c][ii], [iii]. The court therefore counts plaintiffs' choice of this district as one factor weighing against transfer without according it special weight.
As noted above, plaintiff's allegation of sales in this district amounting to less than 1.6% of national sales, though concededly a proper basis for venue, is not a strong one.
7. Familiarity with relevant law
Plaintiff's complaint raises issues of federal law, with which this court and the Northern District are equally familiar. Some of Defendant's counterclaims sound in New York, Mississippi and Texas law. In either venue the court might be called on to apply the law of two states with which it is not familiar. This factor is neutral.
8. Docket congestion
Defendant has submitted evidence demonstrating that cases proceed to trial faster in the Northern District than here and that this district has between three and four times as many civil cases that have been pending for three years or more. Courts in this circuit typically accord this factor relatively little weight. See, e.g., DiStefano, 2002 WL 31640476 at *4; Toy Biz, Inc. v. Centuri Corp., 990 F.Supp. at 331. However, where, as here, plaintiff has selected a forum with scant connection to the subject of the action, the court may properly consider that the interests of justice are not served by retention of the case in this relatively busy district to the extent it would "delay adjudication of other cases brought by parties who are compelled to sue [here]." Royal Sunalliance v. British Airways, 167 F.Supp. 2d 573, 579 (S.D.N.Y. 2001) (quoting Kanbar v. U.S. Healthcare, Inc., 715 F.Supp. 602, 606 (S.D.N.Y. 1989)). This factor weighs in favor of transfer.
9. Judicial economy
As noted above, defendant recently brought suit in the Greenville Division of the Northern District against another competitor tool company, Robert Bosch Tool Corp. In that action defendant brings claims for unfair competition, false designation of origin, and infringement of its color combination mark and for trademark dilution, as well as pendent state claims. The basis of these claims is defendant's alleged protectible interest in its color combination mark. See Bosch Compl. ¶¶ 6-18; 37; 39. Defendant argues (and plaintiff concedes, see Pl. Mem. at 8-9) that the instant declaratory judgment action raises the same issue; defendant argues that judicial economy and the risk of inconsistent judgments therefore favors a transfer of this case to the same district. Plaintiffs argue that because Bosch's alleged trade dress infringement is of much more recent origin and because establishing infringement as against it and Bosch will involve different factual inquiries, transfer will not result in an economy of judicial effort. Plaintiffs also argue that they may have a defense of acquiescence that is personal to them and collateral to the dispute between defendant and Bosch.
"The Second Circuit has stated that '[t]here is a strong policy favoring the litigation of related claims in the same tribunal in order that pretrial discovery can be conducted more efficiently, duplicitous litigation can be avoided, thereby saving time and expense for both parties and witnesses, and inconsistent results can be avoided." Raiber v. Dentsply Intern., Inc., No. 99-0743, 1999 WL 335821, *2 (S.D.N.Y. 1999) (quoting Wyndham Assocs v. Bintliff, 398 F.2d 614, 619 (2d Cir. 1968)). See also 17Moore's § 111.13[o]. While this rule is most often applied to cases in which there is a complete identity of parties, it has also been applied where, as here, a threshold legal issue is dispositive of two litigants' rights and obligations with respect to a third. In Fairfax Dental v. S.J. Filhol Ltd., 645 F. Supp. 89, 92 (E.D.N.Y. 1986), a patent infringement action, the court granted the plaintiff's request to transfer venue to the Southern District where the same plaintiff had filed another infringement suit against a different defendant and the invalidity of the plaintiff's patent was likely to be raised as a defense by the defendants in both actions. The court noted that transfer would avoid "duplicative and inconsistent judgments." Id. at 92 (citing Magnavox Co. v. APF Electronics, Inc., 496 F. Supp. 29, 34 (N.D. Ill. 1980) (denying motion to transfer one of three cases involving validity of the same patent; judicial economy served even though each defendant's infringement might raise distinct factual issues)).
Plaintiffs are certainly correct that the two suits raise distinct issues regarding infringement, and although it is difficult to say at this early stage, it appears that it might well be impractical or inadvisable to consolidate the cases fully for trial purposes. "There is no requirement, however, that consolidation be certain before [the court] can consider the fact that a related action is pending in the transferee court."Fairfax Dental, 645 F. Supp. at 92 n. 2; see also 17Moore's 111.13[1][o]. "The interests of justice require that the cases be related, not identical." Manufacturers Hanover Trust Co. v. Palmer Corp,. 798 F.Supp. 161, 167 (S.D.N.Y. 1992). Nor would the transferee court be required to consolidate the cases for all purposes. See Fed.R.Civ.P. 42(a), (b) (court may order "joint hearing or trial of any or all the matters at issue in the actions" and may order separate trials of any number of issues or claims); 8 Moore's § 42.10[2][a], 42.11[d] (Rule 42 consolidation contemplates and may be limited to consolidation for pre-trial purposes, such as discovery). Even if the cases are not consolidated for all purposes, discovery on the issue of the history of defendant's use of the alleged color combination mark, its awareness of competitors' uses, and consumer association of the color mark with defendant's brand is likely to substantially overlap. In order to avoid a judgment of a protectible interest in defendant in one case and an inconsistent judgment of no such interest in the other — divergent judgments which could result in contrary orders to the Patent and Trademark Office regarding registration of defendant's color combination mark, see 5McCarthy § 30:109 — the court might well also find it appropriate to try (or to consider at the summary judgment stage) the issue of the protectibility of defendant's interest in the color mark jointly, while trying the issue of Bosch's and plaintiffs' infringement vel non or any affirmative defenses separately.
The court takes notice of the fact that Bosch has moved to transfer venue to the Northern District of Illinois and that Judge Pepper has not yet decided that motion. Thus it is not certain that transfer of this action will accomplish any overall saving of effort or avoidance of inconsistent judgments. Under these circumstances the "strong policy" of transferring venue to a district where a related case is pending is necessarily less strong. Even discounting for the risk of transfer, however, the court finds that in light of the significant possibility that portions of the two cases may be jointly tried or otherwise decided, this factor weighs in favor of transfer. See Fairfax Dental, 645 F. Supp. at 92 n. 2 (court may consider pendency of related action even where consolidation upon transfer not certain).
Plaintiffs' attempts to distinguish Fairfax Dental are unpersuasive. They point out, first, that it involved patent infringement, rather than trademark infringement, but do not explain why this makes any material difference. Second, they point to the fact that three of the four defendants to the transferred suit stipulated that discovery in the case in the transferee district could be used in their case. While plaintiffs understandably have made no such stipulation in view of the fact that they oppose transfer, they might well find it expedient to participate in depositions of defendant's witnesses if the case is transferred.
CONCLUSION
For the reasons discussed above, the court finds that convenience to the parties, access to proof, docket congestion and, most importantly, judicial economy and the risk of inconsistent judgments weigh in favor of transfer. Together these factors outweigh the sole factor militating against transfer, plaintiff's choice of this district. Because defendant has met its burden of establishing that the action could have been brought in the transferee district and that the relevant factors weigh in favor of transfer, the motion is granted. The case is transferred to the Northern District of Mississippi, with the respectful recommendation that it be assigned to the Hon. W. Allen Pepper, Jr. of the Greenville Division.SO ORDERED.