Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

MEC Resources, LLC v. Apple Inc.

United States District Court, D. Delaware

September 15, 2017

MEC RESOURCES, LLC
v.
APPLE, INC.

          MEMORANDUM

          KEARNEY, JUDGE.

         A California citizen asks we transfer venue of this patent infringement case filed by a Texas citizen and now being pursued by a North Dakota citizen based on convenience when none of the witnesses or documents have Delaware connections. Parsing through sworn facts, we carefully consider whether another venue is more appropriate to timely resolve a dispute over property created in California or Taiwan between citizens from states other than Delaware. While this Court welcomes the chance to resolve complex patent disputes with proper venue, when a Californian asks to transfer venue in a case brought by a Texan, we carefully evaluate the facts and apply our court of appeals' guidance. Having applied this guidance and rejecting the claim the California citizen waived the convenience of venue argument by waiting until after we ruled on dispositive motions, we enter the accompanying Order granting the California citizen's motion to transfer to the far more convenient district court in the Northern District of California.

         I. Facts relating to venue.

         Before selling its rights to MEC Resources LLC, Prowire LLC owned United States Patent No. 6, 137, 390 titled "Inductors with Minimized EMI Effect and the Method of Manufacturing the Same." ('"390 patent").[1] Prowire alleged Apple, Inc. infringes on the '390 patent by "making, using, importing, selling, and offering for sale" products, such as the iPad 4 tablet computer containing an inductor incorporating Claim 1 and Claim 11 of the '390 patent.[2]Prowire is a Texas limited liability company but we do not know its principal place of business other than it is not in Delaware.[3] The last known contact information for the inventors of the '390 patent is Hsinchu, Taiwan.[4] The prosecuting attorney for the '390 patent is in Honolulu, Hawaii.[5] Prowire obtained the '390 patent from a Taiwanese company called Fuco Technology Co., LTD.[6]

         After suing, Prowire "transferred all right, title, and interest" in the '390 patent to MEC Resources, LLC and we substituted MEC for Prowire.[7] MEC describes itself as "a small patent-holding company."[8] MEC is a North Dakota limited liability company with no presence in Delaware.[9] MEC's chief executive officer is Clarence O'Berry and its chief operating officer is Frank Driscoll.[10] Mr. Driscoll and Mr. O'Berry swear MEC's principal office is in New Town, North Dakota and physical papers, including patent documents and MEC's organizational documents, are located in New Town.[11] Mr. Driscoll swears MEC had no revenue in the calendar year of 2016 and no revenue to date in calendar year 2017.[12] Mr. Driscoll swears he lives in Waterford, Michigan and it would more convenient for him to travel to Delaware than San Francisco, California.[13] Mr. O'Berry swears he lives in Minot, North Dakota. He anticipates being MEC's Fed.R.Civ.P. 30(b)(6) representatives and it would more convenient for him to travel to Delaware than San Francisco, California.[14]

         Apple is a California corporation with its principal place of business in Cupertino, California.[15] Apple is a large, multibillion dollar company with retail stores through the United States.[16] Michael Jaynes, an Apple Finance Manager, swears its "management and primary resource and development facilities" along with 30, 000 of its employees are located in the Northern District of California.[17] Mr. Jaynes also swears Apple does not manufacture the alleged infringing inductors but purchases them from a third party located in Taiwan.[18] After reasonable investigation, Mr. Jaynes located three employees with knowledge about the alleged infringing inductors all located in Cupertino, California.[19] Mr. Jaynes swears the three employees stated the other employees with knowledge about inductors and the documents are located in California, and no documents or knowledgeable employees are located in Delaware.[20]Mr. Jaynes swears Apple only has one retail store in Delaware which sells the iPad 4 containing the alleged infringing inductors.[21] Mr. Jaynes swears he is not aware of any employees with knowledge of the inductors or any relevant documents located in Delaware.[22]

         II. Analysis

         Apple moves to transfer venue to the Northern District of California. As we held in our August 9, 2017 memorandum, venue over this patent infringement claim is proper in this District give sale of iPad 4 devices in Apple's Delaware retail store.[23] MEC does not dispute venue is also proper in the Northern District of California. We may transfer venue under 28 U.S.C. § 1404(a) if we find it appropriate "[f]or the convenience of parties and witnesses, in the interests of justice." Because we do not "lightly disturb" Prowire's choice of venue, Apple bears the burden of establishing venue in the Northern District of California better serves the interests of justice and is the more convenient venue.[24]

         A. Applying Jumara factors warrants transfer.

         In Jumara v. State Farm Ins. Co., our court of appeals defined the relevant private and public interests we must consider when exercising our discretion under 1404(a). Private interests are "the plaintiffs choice of forum; the defendant's preference; whether the claim arose elsewhere; the convenience of the parties; the convenience of the expected witnesses; and the location of the books and records. The relevant public interests are: 'the enforceability of the judgment; practical considerations that could make the trial easy, expeditious, or inexpensive; the relative administrative difficulty in the two fora resulting from court congestion; the local interest in deciding local controversies at home; [and] the public policies of the fora.'".[25]Applying these factors to the sworn facts, we are compelled to transfer venue.

         1.Jumara private interest factors weigh in favor of transfer.

         The private interest factors weigh in favor of transfer.

         a. Prowire's forum of preference.

         While we accord deference to Prowire's choice, "deference given to the plaintiffs choice is reduced when the chosen venue is not the plaintiffs home forum."[26] In MoneyCat Ltd v. PayPal, Inc., an Israeli company which did not do business in the United States and had no apparent ties to Delaware law sued a company incorporated with its principal place of business in San Jose, California.[27] Plaintiff argued Delaware is more convenient because it is a shorter trip from Israel to Delaware than to California.[28] The court granted defendant's motion to transfer venue and gave the plaintiffs forum preference less deference because "whatever marginal additional inconvenience will be inflicted on [plaintiff] by having to litigate in California is outweighed by transferring this case to the place where the bulk of the evidence exists."[29]

         MEC (having recently substituted in for Prowire) cites numerous cases is asking we defer to Prowire's choice of venue where the plaintiff is a foreign corporation or where Delaware is not the plaintiffs home turf. Our review shows every case cited by MEC involves a party with ties to Delaware. No cited case addresses our situation where neither party is incorporated or has a principal place of business in Delaware.[30] MEC relies on Simms and Cypress Semiconductor to argue we should afford deference to Prowire's choice if it has rational, legitimate reasons for its choice; Simms involved a plaintiff residing in Delaware and Cypress Semiconductor involved a plaintiff incorporated in Delaware.[31] Prowire has no ties to Delaware and is formed in Texas. MEC has no ties to Delaware and its place of formation, North Dakota, is geographically closer to the Northern District of California than here. The bulk of the evidence is likely located in the Northern District of California and Taiwan. Prowire's initial preference (now adopted by MEC) for Delaware weighs minimally against transferring venue.

         b. Apple's forum preference.

         Apple prefers to litigate in the Northern District of California where it is incorporated and has its principal place of business. Apple's preference weighs in favor of transferring venue but we accord its preference less weight than Prowire's or MEC's preference (which we accord less deference than usual).[32]

         c. Whether the claim arose elsewhere.

         Under 35 U.S.C. § 271(a), Apple's claims arose "wherever someone has committed acts of infringement" but courts hold "infringement claims, however, have even deeper roots in the forum where the accused products were developed."[33] Apple sells its allegedly infringing products to customers from its retail store in Delaware so claims do arise here.[34] Apple declares, and MEC does not dispute, the alleged infringing inductors are manufactured in Taiwan and the design, research, and employees who designed the iPad4 which contains the allegedly infringing inductors are in Cupertino, California. This factor weighs in favor of transfer because MEC's claims have "deeper roots" in the Northern District of California where Apple designed and decided to incorporate the alleged infringing inductors from Taiwan.[35]

         d. The convenience of the parties.

         We consider the "(1) the parties' physical location; (2) the associated logistical and operational costs to the parties' employees in traveling to Delaware (as opposed to the proposed transferee district) for litigation purposes; and (3) the relative ability of each party to bear these costs in light of its size and financial wherewithal."[36]

         Neither party is formed or has a principal place of business in Delaware. MEC is located in North Dakota which is geographically closer to the Northern District of California than this District, with one employee located in Michigan and another located in North Dakota. MEC's two employees will travel to trial whether it is here or in the Northern District of California. MEC's two employees argue Delaware is more convenient than the Northern District of California but do not explain why.

         Apple's relevant employees are located in Cupertino, California. The associated logistical and operational costs for Apple's employees to travel to Delaware would be complicated and more expensive than trial in the Northern District of California.

         MEC argues Apple as a multibillion corporation is not burdened by litigating in Delaware. The parties' financial wherewithal is a neutral consideration because litigation in Delaware is not a burden on Apple and Prowire already choose to litigate in a place where it is not located accepting the costs of travel. MEC bought these rights knowing it of this suit in this District.

         Overall, this factor weighs in favor of transfer because the parties' physical locations are not convenient to Delaware and MEC's litigation costs will likely remain the same because its two employees must travel even if we do not transfer venue.

         e. The convenience of the witnesses.

         We consider the convenience of the witnesses "but only to the extent that the witnesses may actually be unavailable for trial in one of the fora."[37] We do not consider witnesses employed by the parties but necessary third party witnesses outside the parties' control.[38]

         Apple argues this factor weighs in favor of transfer because none of the inventors of the patents-in-suit reside in Delaware; they reside in Taiwan and the attorney for the patent-in-suit is in Hawaii. Apple argues the Northern District of California is closer and more convenient for the witnesses traveling from Taiwan and Hawaii. MEC argues Apple does not show any of these witnesses would not attend trial. We do not "require such a clear statement-it is enough that likely witnesses reside beyond the court's subpoena power and that there is reason to believe that those witnesses will refuse to testify absent subpoena power."[39] Neither district enjoys subpoena power over the third party witnesses.

         This factor is neutral.

         f. The location of books and records.

         We consider the location of books and records "limited to the extent that the files could not be produced in the alternative forum."[40] In infringement cases, the '"bulk of relevant evidence' using comes from the accused infringer, such that the location of the [accused infringer's] documents can favor transfer."[41] While technology reduces the importance of this factor, the Court of Appeals for the Federal Circuit cautions "it is improper to ignore them entirely."[42]

         Apple designed and developed the product containing the allegedly infringing inductor in Cupertino, California which is also its principal place of business so "it is reasonable to presume that much of the evidence will be found there."[43] Relevant documents from the patent inventors are likely located in Taiwan or Hawaii. Neither party argues there are relevant documents in this District. This factor weighs in favor of transfer.

         2.Jumara public interest factors weigh in favor ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.