Data Scape Limited v. Dell Technologies, Inc. et al

Western District of Texas, txwd-6:2019-cv-00129

REPLY to Response to Motion, filed by Dell Inc., Dell Technologies, Inc., EMC Corporation, re [36] Opposed MOTION to Transfer Case Intra-District to the Austin Division filed by EMC Corporation, Dell Technologies, Inc., Dell Inc.

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0 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF TEXAS WACO DIVISION DATA SCAPE LIMITED, Plaintiff, v. C.A. No. 6:19-cv-00129-ADA DELL TECHNOLOGIES INC., DELL INC., and EMC CORPORATION, Defendants. DEFENDANTS' REPLY IN SUPPORT OF DEFENDANTS' MOTION FOR INTRA-DISTRICT TRANSFER OF VENUE 0 TABLE OF CONTENTS Page I. INTRODUCTION ...............................................................................................................1 II. DATA SCAPE'S CLAIM OF A "HOME TOWN" ADVANTAGE IS SPECULATIVE AND IGNORES CONTROLLING LAW ...............................................1 III. DATA SCAPE'S ARGUMENTS ON THE RELEVANT TRANSFER FACTORS IGNORE AND ARE UNSUPPORTED BY CONTROLLING LAW .............3 IV. CONCLUSION ....................................................................................................................5 i 0 TABLE OF AUTHORITIES Page(s) CASES Cadle Co. v. Keyser, No. 14-CV-00758, 2015 WL 764256 (W.D. Tex. Feb. 23, 2015) ....................................................................................................................................2 Carruth v. Michot, No. 15-CA-00189, 2015 WL 6506550 (W.D. Tex. Oct. 26, 2015) ....................................................................................................................................4 In re Acer America Corp., 626 F.3d 1252 (Fed. Cir. 2010).............................................................2 In re Apple, Inc., 581 F. App'x 886 (Fed. Cir. 2014) ......................................................................2 In re HP Inc., No. 2018-149, 2018 WL 4692486 (Fed. Cir. Sept. 25, 2018) ..................................2 In re Microsoft Corp., 630 F.3d 1361 (Fed. Cir. 2011) ...................................................................2 In re Nintendo Co., 589 F.3d 1194 (Fed. Cir. 2009)........................................................................2 In re Radmax, Ltd., 720 F.3d 285 (5th Cir. 2013) ...................................................................1, 2, 3 In re Toyota Motor Corp., 747 F.3d 1338 (Fed. Cir. 2014).............................................................3 In re TS Tech USA Corp., 551 F.3d 1315 (Fed. Cir. 2008) .............................................................2 Kimberly-Clark Worldwide, Inc. v. First Quality Baby Products, LLC, No. 309- CV-00488, 2009 WL 2634860 (N.D. Tex. Aug. 26, 2009) .................................................4 Mimedx Group, Inc. v. Texas Human Biologics, Ltd., No. 14-CV-00464, 2014 WL 12479284 (W.D. Tex. Aug. 12, 2014) ......................................................................3, 5 TC Heartland LLC v. Kraft Foods Group Brands LLC, 137 S. Ct. 1514 (2017) ............................1 Uniloc USA, Inc. v. Apple Inc., No. 18-CV-00992, 2019 WL 2035583 (W.D. Tex. Apr. 8, 2019) ....................................................................................................................2, 3 In re Volkswagen of America, Inc., 545 F.3d 304 (5th Cir. 2008)...................................................4 ZitoVault, LLC v. Amazon.com, Inc., No. 15-CV-00152, 2015 WL 11089482 (E.D. Tex. Dec. 7, 2015) ......................................................................................................2 ii 0 I. INTRODUCTION Data Scape's opposition to Dell's transfer motion confirms what was already apparent: this case has no connection to Waco and should not have been filed there. Data Scape claims that the "short trip from Waco to Austin" cannot possibly be inconvenient enough to warrant transfer. (ECF 37 at 1.) But the Fifth Circuit held precisely the opposite in Radmax, emphasizing that the transfer factors "apply as much to transfers between divisions" and ordering transfer from Marshall to Tyler (a distance of sixty- two miles, less than the distance at issue here). In re Radmax, Ltd., 720 F.3d 285, 288-90 (5th Cir. 2013). Data Scape's discussion of the relevant transfer factors similarly ignores controlling Fifth Circuit and Federal Circuit law. Both courts have repeatedly transferred cases to a defendant's "hometown," where the transfer factors warrant it. As Radmax confirms, the essential inquiry is the relative convenience between the two forums. Id. at 288-90. Where the only relevant connections are to one division—as is the case here—the case must proceed in that division. Id. at 290. Transfer is thus required. II. DATA SCAPE'S CLAIM OF A "HOME TOWN" ADVANTAGE IS SPECULATIVE AND IGNORES CONTROLLING LAW Data Scape has not identified a single relevant fact connecting this case to Waco. Instead, its primary argument for keeping venue in Waco is a purported desire "to avoid being 'home towned.'" (ECF 37 at 1.) Data Scape cites nothing to support its speculation that it would not receive a fair trial in Austin. If a speculative claim of hometown advantage were sufficient to defeat a motion for transfer, no case would ever proceed in a defendant's primary place of business. That is decidedly not the law. As the Supreme Court held in TC Heartland, the venue statute requires a patent infringement case to proceed where the defendant resides or has an established place of business. TC Heartland LLC v. Kraft Foods Grp. Brands LLC, 137 S. Ct. 1514, 1520 (2017). And as the Fifth Circuit held in Radmax, where the only relevant connections in a case are to one division, the case must proceed in that division. 720 F.3d at 290. 0 Consistent with these principles, countless patent cases have been transferred to the defendant's "hometown"—including for large, well-known companies like Microsoft, Apple, Amazon, HP, and Nintendo. See, e.g., In re Microsoft Corp., 630 F.3d 1361 (Fed. Cir. 2011) (granting mandamus and ordering transfer to W.D. Washington where Microsoft has its headquarters); Uniloc USA, Inc. v. Apple Inc., No. 18-CV-00992, 2019 WL 2035583 (W.D. Tex. Apr. 8, 2019) (transferring case to N.D. California where Apple has its headquarters). 1 In short, Data Scape's attempt to defend its filing of this lawsuit in Waco is flatly inconsistent with controlling law. Indeed, courts in this District have held that deference to a plaintiff's choice of forum is diminished where, as here, "plaintiff is not a resident of the chosen forum, or the operative facts underlying the case did not occur in the chosen forum." See Cadle Co. v. Keyser, No. 14-CV-00758, 2015 WL 764256, at *2 (W.D. Tex. Feb. 23, 2015). And that "lower deference is lessened even further when the transfer sought is between divisions of the same district." Id. Dell has shown that this case has no connection to Waco and that Austin is clearly the more convenient venue. Transfer is therefore "compelled." Radmax, 720 F.3d at 290. 2 1 See also In re Apple, Inc., 581 F. App'x 886 (Fed. Cir. 2014) (nonprecedential) (granting mandamus and transferring to N.D. California where Apple has its headquarters); In re Acer Am. Corp., 626 F.3d 1252 (Fed. Cir. 2010) (granting mandamus and transferring to N.D. California where five of twelve accused infringers, including Apple, Acer, ASUS, and Gateway, were headquartered); In re HP Inc., No. 2018-149, 2018 WL 4692486 (Fed. Cir. Sept. 25, 2018) (nonprecedential) (affirming transfer to N.D. California where HP has its headquarters); In re Nintendo Co., 589 F.3d 1194 (Fed. Cir. 2009) (granting mandamus and transferring to W.D. Washington where Nintendo has its headquarters); ZitoVault, LLC v. Amazon.com, Inc., No. 15-CV-00152, 2015 WL 11089482 (E.D. Tex. Dec. 7, 2015) (transferring case to W.D. Washington where Amazon has its headquarters). 2 As the Federal Circuit observed, "Fifth Circuit precedent clearly forbids treating the plaintiff's choice of venue as a distinct factor in the § 1404(a) analysis," because this "deference" is already embodied in the multi-factor transfer analysis. In re TS Tech USA Corp., 551 F.3d 1315, 1320 (Fed. Cir. 2008). 2 0 III. DATA SCAPE'S ARGUMENTS ON THE RELEVANT TRANSFER FACTORS IGNORE AND ARE UNSUPPORTED BY CONTROLLING LAW Data Scape also claims that the relevant § 1404 factors do not support transfer. But, here too, its arguments again are directly contrary to well-established Fifth Circuit and Federal Circuit law. As the Fifth Circuit emphasized in Radmax, the relevant inquiry is relative convenience, not absolute. 720 F.3d at 288-90 (ordering intra-district transfer because Tyler was relatively more convenient than Marshall); see also In re Toyota Motor Corp., 747 F.3d 1338, 1341 (Fed. Cir. 2014) ("[N]othing favors the transferor forum, whereas several factors favor the transferee forum. The analysis may not show that the transferee forum is far more convenient. But that is not what is required."). The fact that Dell also has relevant operations in California, Massachusetts, and Israel is beside the point. Between Austin and Waco, there can be no question that Austin is a substantially more convenient forum. 1. Relative ease of access to sources of proof. Data Scape claims that this factor only favors transfer when the "bulk" or "majority" of evidence is in the transferee district. (ECF 37 at 3.) But it has not cited a single case requiring such a showing. Rather, as Radmax confirms, the relevant inquiry is the relative ease of access, as compared between the two forums. See Radmax, 720 F.3d at 288. 3 Dell presented uncontroverted evidence of relevant sources of proof in Austin, including sales, marketing, and financial information related to the accused products. There are no such sources in Waco. (ECF 36-1, ¶¶ 5, 7). This factor thus strongly supports transfer. 2. Cost of attendance for willing witnesses. Data Scape complains that Dell "cherry- pick[ed]" only witnesses in Austin and failed to identify their relevance to the case. (ECF 37 at 6.) Not 3 Data Scape goes even further, arguing that Dell must establish that documents are "uniquely available" in the transferee district (although it does not explain what this means). (ECF 37 at 4.) Again, Data Scape's arguments are unsupported and contradicted by controlling case law. See Radmax, 720 F.3d at 288; Mimedx Grp., Inc. v. Texas Human Biologics, Ltd., No. 14-CV-00464, 2014 WL 12479284, at *3 (W.D. Tex. Aug. 12, 2014); Uniloc, 2019 WL 2035583, at *3. 3 0 so. Dell presented a list of Austin employees who might serve as potential witnesses in this case and explained that these employees have "knowledge of Dell's marketing and sales of the accused products and their financial performance"—key issues Data Scape cites in its complaint as a basis for infringement and damages. (ECF 36-1, ¶ 5.) In contrast, there are no such witnesses in Waco. As Dell confirmed, it "has no employees located in the Waco Division who have any responsibilities related to its Data Domain or RecoverPoint products." (ECF 36-1, ¶¶ 4-5.) This factor thus strongly supports transfer. 4 3. Availability of compulsory process. Data Scape claims that this factor supports its choice of forum because a Waco court would have compulsory process over any Dell employees located in Dallas. But it has not identified a single relevant witness in Dallas other than Blake Dugan—who, as stated in Dell's declaration, is in the process of moving to Austin. (ECF 37 at 7.) Mere attorney conjecture that there might be others does not suffice to show this factor weighs against transfer. See Kimberly-Clark Worldwide, Inc. v. First Quality Baby Prods., LLC, No. 309- CV-00488, 2009 WL 2634860, at *6 (N.D. Tex. Aug. 26, 2009) (finding factor neutral where party had "not specifically identified a single witness by name and address"). And this conjecture is ultimately beside the point because the compulsory process factor focuses on unwilling, non-party witnesses. See Carruth v. Michot, No. 15-CA-00189, 2015 WL 6506550, at *9 (W.D. Tex. Oct. 26, 2015) ("Because party witnesses do not typically require compulsory process, the Court focuses on non-party witnesses."). As stated in Dell's motion, this factor accordingly remains neutral. 5 4 Furthermore, for witnesses outside of the Western District of Texas, Dell explained that Austin would be preferable to Waco "because of the convenience Dell's Round Rock headquarters provides" (ECF 36 at 7). Data Scape's reference to arbitrary hotel prices in the two cities is unhelpful to the analysis, as this factor takes into consideration many other costs beyond merely lodging (including interferences with a witness's job). See In re Volkswagen of Am., Inc., 545 F.3d 304, 317 (5th Cir. 2008). 5 Data Scape misstates Dell's position regarding this factor. (ECF 37 at 6.) Dell stated in its opening brief that this factor is neutral. (ECF 36 at 10.) 4 0 4. Other practical problems. Data Scape acknowledges that, "where the other transfer factors clearly favor transfer, the existence of co-pending litigation, by itself, should not preclude transfer." (ECF 37 at 9.) That is the exact scenario presented in this case, where all the factors strongly favor litigating in Austin or are neutral. Furthermore, while Data Scape emphasizes the three other cases pending in Waco to support its claims of judicial economy (two of which have transfer motions pending, and the third of which is stayed), it completely ignores the at least ten other cases it has filed in other district courts and the International Trade Commission. Data Scape's concern that transfer would "requir[e] another court to address overlapping issues, and would create a risk of inconsistent rulings" cannot be taken seriously. (ECF 37 at 8.) And in any event, both parties have assented to this Court retaining control of the proceedings, eliminating any risk of judicial waste or inefficiency associated with transfer. 5. Local interest in having localized interests decided at home. Data Scape claims that Austin cannot have an interest in this litigation because Dell asserted in another case that California has an interest in Dell's Data Domain products. (ECF 37 at 9.) There is certainly no dispute that California also has an interest in this case—as explained in Dell's declaration, Dell has relevant operations in Austin, California, Massachusetts, and Israel. (ECF 36-1, ¶¶ 5-7.) But there is no rule that only a single forum can have a local interest in deciding a case. Instead, the local interest factor, like all § 1404 factors, is concerned with the relative convenience/interests between the transferee and transferor forums. See Mimedx, 2014 WL 12479284, at *3 ("The ultimate outcome of this suit likely affects local San Antonio interests more acutely than local Austin interests." (emphasis added)). Once again, the critical point is that Waco has no interest in this litigation. The local interest factor thus strongly favors transfer. IV. CONCLUSION The Court should transfer this case to Austin for further proceedings. 5 0 Dated: May 15, 2019 Respectfully submitted, /s/ Shirley Cantin Deron Dacus Texas Bar No. 790553 THE DACUS FIRM, P.C. 821 ESE Loop 323, Suite 430 Tyler, TX 75701 Telephone: (903) 705-1117 Fax: (903) 581-2543 ddacus@dacusfirm.com Cynthia D. Vreeland Texas Bar No. 20625150 Shirley X. Li Cantin Massachusetts Bar No. 675377 WILMER CUTLER PICKERING HALE AND DORR LLP 60 State Street Boston, MA 02109 Telephone: (617) 526-6000 Fax: (617) 526-5000 Cynthia.Vreeland@wilmerhale.com Shirley.Cantin@wilmerhale.com E. Ross Cohen D.C. Bar No. 1542122 WILMER CUTLER PICKERING HALE AND DORR LLP 1875 Pennsylvania Avenue NW Washington, DC 20006 Telephone: (202) 663-6000 Fax: (202) 663-6363 Ross.Cohen@wilmerhale.com Attorneys for Dell Technologies Inc., Dell Inc., and EMC Corporation 6 0 CERTIFICATE OF SERVICE I hereby certify that a true and correct copy of the above and foregoing document has been served on all counsel of record via the Court's ECF system on May 15, 2019. /s/ Shirley Cantin Shirley Cantin 7