Petition denied 4/20/15.CAFC Opinion, No CAFC ArgumentEON Corp. IP Holdings, LLC v. Apple, Inc., No. 14-978Questions Presented:Under controlling law in the court below, motions to transfer venue pursuant to 28 U.S.C. § 1404(a) are governed by an application of the “Gilbert” factors used in forum non conveniens determinations as established in Gulf Oil Corp. v. Gilbert, 330 U.S. 501 (1947). The questions presented are:Is a writ of mandamus appropriate to review a trial court's exercise of discretion to deny a transfer motion pursuant to 28 U.S.C. § 1404(a)?
The outcome of a successful venue motion can help set the tone of the litigation and may drastically alter the settlement calculus. But although venue motions should typically be filed quite early on in the proceedings, there is an inherent tension between the need to move promptly and the need to develop a factual record sufficient to satisfy the applicable burden in the district court—and if necessary, in the Federal Circuit.Legal Framework Venue in patent cases is governed by the general federal venue statute, 28 U.S.C. § 1391, and by the patent-specific venue statute, 28 U.S.C. § 1404(b).[ii] Section 1404(b) provides that an action for patent infringement “may be brought in the judicial district where the defendant resides, or where the defendant has committed acts of infringement and has a regular and established place of business.”
Co. v. U.S. District Court for the Western District of Texas, 187 L. Ed. 2d 487 (2013). Specifically, the Court held that when a defendant seeks to enforce a forum-selection clause pointing to a federal court other the one in which suit has been brought, by filing a motion to transfer venue, under 28 U.S.C. § 1404(a), “a district court should transfer the case unless extraordinary circumstances unrelated to the convenience of the parties clearly disfavor a transfer.” This high standard also applies where the defendant seeks to enforce a forum-selection clause pointing to a state court by filing a motion to dismiss the action for forum non conveniens.BackgroundAlthough Atlantic Marine did not arise in the employment context, a brief summary of the facts is helpful.
By Robert Milligan and Jeffrey OhIn today’s dynamic environment of interstate commerce, including internet transactions, deciding on the proper venue for a trade secret misappropriation dispute can be a complicated process involving a number of different factors particularly if the parties are domiciled and/or transact business in different states.In the case of GLT Technovations, LLC v. Fownes Brothers & Co., 2012 WL 1380338 (N.D.Cal.), District Judge Ronald M. Whyte of the U.S. District Court for the Northern District of California granted the Defendant’s Motion to Transfer pursuant to 28 U.S.C. § 1404(a) and sent the case to theSouthern District of NewYork where a related case was already pending. Section 28 U.S.C. § 1404(a) provides that"[f]or the convenience of parties and witnesses, in the interest of justice, a district courtmay transfer any civil action to any other district or division where it might have been brought or to any district or division to which all parties have consented."
Stuebing also alleged that venue was proper as to defendant Gavronsky because he maintained a residence in Ohio. Defendants brought a motion under 28 U.S.C. § 1404(a) to transfer the case to the Southern District of Texas, arguing that it was a more convenient forum, for multiple reasons—including that both defendants resided in the Southern District of Texas, Lerma operated Matamoros in that district, and any alleged patent infringement occurred in that district. The court denied this motion in December 2016.
The Supreme Court’s decision in Atlantic Marine is significant for two reasons: (i) the Supreme Court clarified the procedural mechanism for obtaining the dismissal or transfer of an action where the parties to the action also have an agreement with a valid forum-selection clause and (ii) the Supreme Court reiterated that such forum-selection clause are generally (albeit not always) enforceable. As to the procedural mechanism, the Supreme Court explained that, when a particular federal forum is specified or permitted in the parties’ forum-selection agreement, the remedy when a lawsuit is filed in the “wrong” federal forum is a 28 U.S.C. §1404(a) motion to transfer the action to the “right” forum. However, in cases where the forum-selection agreement requires resolution of disputes in a state court or in the courts of a foreign country, the remedy when a lawsuit is filed in the “wrong” forum is a motion to dismiss under the common-law doctrine of forum non conveniens.
§1406(a) and Federal Rule of Civil Procedure 12(b)(3). Other courts have held that the appropriate mechanism to enforce a forum selection provision is the discretionary transfer procedure under 28U.S.C. §1404(a). If the discretionary transfer statute is used, a further question arises: Is the forum selection provision entitled to determinative weight, or is it just one of the numerous public and private factors the court may consider in making a discretionary transfer decision?
001 makes out-of-state forum selection clauses voidable at a contractor’s option, J-Crew argued that AMC’s motion to dismiss/transfer was moot because the federal court was required to enforce Texas public policy. In the alternative, even if Texas law did not control, J-Crew argued the judge should exercise his discretion under 28 U.S.C. § 1404 to keep the lawsuit in Texas notwithstanding the forum selection clause, given that § 1404 permits a court to consider “the convenience of parties and witnesses” and “the interest of justice” in deciding whether to transfer a case. Under a § 1404 analysis, the forum selection clause specifying venue in Virginia would be just one of many factors to be considered, along with the fact that all the work occurred in Texas, J-Crew and its subcontractors were located in Texas, and, as noted above, Texas public policy disfavors litigation anywhere else.
On April 1, the U.S. Supreme Court agreed to review a decision from the U.S. Court of Appeals for the Fifth Circuit that denied a mandamus petition against a district court that held that when a forum-selection clause designates a specific federal forum or allows the parties to select the federal courts of a different forum, the federal change of venue statute, 28 U.S.C. § 1404(a),—as opposed to Rule 12(b)(3) and 28 USC §1406—is the proper procedural mechanism for the clause’s enforcement. Atl. Marine Constr.
On August 8, 2012, the California case was transferred to the Northern District of Georgia based on the "first-to-file" rule. In the declaratory judgment action, IGS moved to dismiss for lack of personal jurisdiction or, alternatively, to transfer to the Central District of California under 28 U.S.C. § 1404. Atlantis moved to conduct jurisdictional discovery, and also moved to stay the action pending a PTO reexamination of the '324 and '428 patents.