Odom v. Microsoft, 6:08cv331 (Jan. 30, 2009)
Judge: John Love
Holding: Defendant's Motion to Transfer Venue GRANTED
It took exactly one month for the first Eastern District venue opinion in a patent case reflecting the Federal Circuit's recent opinion in In re TS Tech to come out, and fortunately for practitioners it provides a thorough analysis of the application of both In re VW II and In re TS Tech to patent cases (in the line of older Eastern District cases like Network-1 v. D-Link, Mohamed v. Mazda and TI v. Micron, which sought to explain the issues and the relevant law, as well as resolve specific motions). In this case, the plaintiff is an Oregon inventor (better known to many as Patent Hawk) claiming that Microsoft, the sole defendant, infringes his patent via its Office software. Microsoft sought a transfer to Oregon (next to Washington, where Microsoft is located). I won't go into the factual background of the case, which involves Odom's relationship with Microsoft and the Klarquist Sparkman firm in Oregon prior to suit being filed, but those facts become important later.
Judge Love's opinion not only cites but analyzes both In re VW II and In re TS Tech, the first to do both since the latter came out. Judge Love distinguished this case from In re TS Tech in that this is a case dealing with software code, unlike the prior cases dealing with physical evidence, so the location of the original code does not mean any benefit in convenience for anyone, as opposed to, for example, the cars or car parts at issue in both VW and TS Tech. Neither case, Judge Love points out, dealt with electronic information, as opposed to physical information.
On the issue of cost of attendance of witnesses, Judge Love noted that the Federal Circuit did not explicitly address in TS Tech what showing was necessary on this factor, or the relative importance of party versus nonparty status. Movants are generally required to list the relevant witnesses and outline the substance of their testimony so the Court can evaluate the importance of the claimed witnesses, but VW II made clear that affidavits are not required for this showing - in that case a simple list with an explanation was sufficient. In this case, the parties argued over what showing was necessary on this factor, but Judge Love concluded that although the specific showing in each case varies depending on the facts, in this case the defendant's showing was sufficient. In short, the Court held that although there was still some factual dispute as to who the witnesses were and where they were located, there was not really a dispute that they were located in the Washington/Oregon area. Importantly, Judge Love observed that "This is not a case where witnesses are spread out all over the country or the world" citing Network-1 Sec. Solutions, Inc. v. D-Link Corp., 433 F. Supp. 2d 795, 800, mandamus denied, 183 Fed. Appx. 967 (Fed. Cir. 2006) (finding this factor neutral where witnesses were located in Connecticut, New York, California, Taiwan, and Israel). For readers unfamiliar with the Network-1 case, the Federal Circuit in that case denied a petition for writ of mandamus compelling Judge Davis to transfer a case where witnesses were spread through the U.S. and in fact, the world. (Network-1, by the way, provides the best explanation extant for how patent cases differ from other cases, and how the venue factors apply in such cases, and I highly recommand it). This case. Judge Love wrote, was in fact quite similar to the facts in TS Tech, not Network-1.
On the local interest factor, Judge Love acknowledged that TS Tech held that, in patent cases, when a defendant sells products all over the country, no specific venue has a dominant interest in resolving the issue of patent infringement, so "in most patent cases" this factor will be neutral. But not in this case, however. Due to the extensive ties Oregon has to the underlying case via the contracts, etc., Judge Love concluded that there was in fact a local interest in the case in Oregon, and none in Texas. That also influenced the familiarity with the law applicable law factor, since this case, unlike most patent cases, involved contract claims requiring application of Oregon law.
Accordingly, after weighing the relevant factors, Judge Love concluded:
The Court finds that Defendant has shown that transfer to the District of Oregon would be clearly more convenient. See Volkswagen II, 545 F.3d at 315.