Data Scape Limited v. Dropbox, Inc.

Western District of Texas, txwd-6:2019-cv-00023

REPLY to Response to Motion, filed by Dropbox, Inc., re {{32}} MOTION to Change Venue filed by Defendant Dropbox, Inc.

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IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF TEXAS WACO DIVISION DATA SCAPE LTD., Civil Action No. 6:19-cv-00023-ADA Plaintiff, v. DROPBOX, INC., Defendant. DROPBOX'S REPLY IN SUPPORT OF ITS MOTION TO TRANSFER VENUE TO THE NORTHERN DISTRICT OF CALIFORNIA Data Scape's brief in opposition to Dropbox's motion to transfer rings hollow to anyone who has tried a patent infringement case, as this Court has many times. Data Scape's primary argument is that there are potential trial witnesses that Dropbox's motion does not address. But other than Data Scape's sole U.S. employee (in New York), the individuals Data Scape identifies as relevant witnesses are exceedingly unlikely to testify in a patent infringement trial, unlike the Northern District of California-based witnesses Dropbox identified in its motion. Indeed, one of the purported witnesses in Austin that Data Scape identifies is deceased. The convenience of these witnesses is therefore irrelevant to the transfer analysis. Tellingly, Data Scape makes no argument that the facts of this case are distinguishable from those at issue in the decisions of Judges Yeakel and Sparks, and the Federal Circuit, discussed in Dropbox's motion (see Mot. at 7-8). They are not. The opposition also wholly fails to address the fact that Data Scape filed seven cases involving the same patents in California in recent months, and thus cannot credibly claim that the Northern District of California is inconvenient or that judicial economy considerations favor this District. Indeed, when examined, Data Scape's opposition further underscores that the Northern District of California is a clearly more convenient venue and that transfer under 28 U.S.C. § 1404(a) is warranted. 1. San Francisco is Clearly More Convenient and Less Expensive for Witnesses Likely to Testify at Trial Data Scape's primary argument in opposition is that there are trial witnesses for whom Waco would be a more convenient and less expensive forum than San Francisco, see Opp. at 6- 11; 15-16. Data Scape's assertions lack merit because the individuals it identifies are not going to be trial witnesses. First, Data Scape identifies six current and former Dropbox employees in Austin whose LinkedIn profiles contain the word "sync." See Opp. at 7-11. As an initial matter, were such a LinkedIn search a reliable way to identify relevant trial witnesses (it's not), it would 1 show that the Northern District of California is clearly more convenient. As compared to the six that Data Scape identified in Austin, there are 43 LinkedIn profiles of current and former Dropbox employees in the San Francisco Bay Area whose profiles include the word "sync." Second Declaration of Gregory H. Lantier ("Lantier Decl.") at ¶ 3, Ex. 1. More importantly, none of the individuals Data Scape identifies has any reasonable likelihood of testifying at trial: Mr. Roeder untimely died in an accident over a year ago; Mr. Aguillon is a customer support agent who, in any event, is moving to San Francisco next week; Mr. Carp hasn't worked at Dropbox in nine months and was just one of many members of the Smart Sync development team1; Ms. Belkin, Mr. Betzer, and Ms. Sayers are or were account executives with no specific responsibility for Smart Sync.2 Lantier Decl. at ¶¶ 4-7. In contrast, the Northern California witnesses Dropbox identified in its Motion are the people most likely to testify at trial. In addition to the fact that the entire current engineering team responsible for Smart Sync is based in San Francisco and Seattle, San Francisco-based engineers Drew Haven, Isaac Goldberg, and Damien DeVille were all on the development team for Smart Sync and therefore the current Dropbox employees in the best position to discuss the feature. See Mot. at 4. Former employee Ben Newhouse was the person who proposed adding the accused feature in the first instance. See id. at 5; Lantier Decl. at ¶ 8, Ex. 2. And the current and former product managers for the accused feature, Emily Silberstein and Kelly Marren, see id. at 4-5, are far more likely to testify about customer demand for this and other product features than a sales manager or account executive. Second, Data Scape identifies third-party witnesses who are either (1) lawyers that 1 Data Scape's assertion that Mr. Carp is also "likely to possess relevant and material knowledge of the datacenter infrastructure supporting Dropbox's products" (opp. at 10) is both unsupported and irrelevant because (1) the data center is not the Western District and (2) Data Scape does not claim, and in fact cannot claim, that the Texas data center has any connection to the accused feature in this case. 2 Contrary to Data Scape's assertion that "a significant component" of marketing of the accused feature occurs in Austin (opp. at 18), all of Dropbox's marketing activities are based in San Francisco. Haven Decl. ¶ 6. 2 prosecuted the asserted patents or (2) lawyers that wrote assignment documents. But as any experienced trial lawyer who has handled patent infringement actions knows, it is exceedingly unlikely that these individuals would testify at trial.3 Indeed, in all six patent infringement trials that Data Scape's counsel have handled, such individuals have been called to testify at trial zero times. Lantier Decl. at ¶ 9, Ex. 3-4. By contrast, in each of those trials, defendants' engineers and high level executives testified. Id. Third, Data Scape argues that Dropbox has customers in the Western District. See Opp. at 11. But Data Scape makes no claim that any of Dropbox's Texas (or other) customers is likely to testify in this case, because none is. The law is clear that the presence of customers in a forum – especially where the defendant provides its service nationally over the Internet – is not a basis to find against a convenience transfer. See OpenSpend, Inc. v. Salon Target, Inc., No. A-18-CV- 585-LY, 2019 WL 1313468, at *3 (W.D. Tex. Jan. 22, 2019), report and recommendation adopted, No. A-18-CV-00585-LY, 2019 WL 1313451 (W.D. Tex. Feb. 28, 2019). Finally, Data Scape's sole U.S. employee's bald statement that Waco is more convenient for him (Padian Decl. at ¶ 4) ignores that the travel time from New York to either San Francisco or to Waco is comparable (see Lantier Decl. at ¶¶ 10-11, Ex. 5-6) and that Data Scape has chosen California for seven other lawsuits on the same patents. See Mot. at 3. 2. San Francisco is Clearly More Convenient for Accessing Source Code and Documents As noted above, Data Scape remarkably makes no attempt to distinguish the numerous Western District and Federal Circuit decisions discussed in Dropbox's motion. Instead, citing a single Eastern District decision, Data Scape next argues that the location of source code is irrelevant to the transfer analysis. Odom v. Microsoft Corp., 596 F. Supp. 2d 995, 1000 (E.D. 3 Dropbox's answer does not allege that the asserted patents were procured through inequitable conduct. 3 Tex. 2009) (Magistrate Judge Love.). See Opp. at 13. That's not correct in this District. Odom is contrary to Judge Yeakel's holding in Uniloc that source code is more conveniently accessed where it resides. 2018 WL 2729202, at *2. And Data Scape's more general argument that the location where documents are created and kept is irrelevant is contrary to Fifth Circuit and Western District law. See TS Tech, 551 F.3d at 1321. See also Uniloc, 2018 WL 2729202, at *2; DataQuill, 2014 WL 2722201, at *3. The fact is, relevant source code and documents reside in the Northern District of California and not this District. 3. The Availability of Compulsory Process Supports Transfer Citing only decisions from outside the Western District, Data Scape next argues that Dropbox "bears the burden to demonstrate and identify unwilling third-party witnesses." (Opp. at 14) (emphasis added). Once again, that is not the law in this District. To the contrary, in Uniloc, Judge Yeakel explained that "[t]he focus of this factor is not whether a witness may become an unwilling witness, or whether a court may need to invoke its subpoena power; rather, the focus is on the availability of process to secure attendance of a witness if need be." 2018 WL 2729202, at *3 (emphasis added).4 Further, whether these third parties are willing or unwilling, their convenience strongly supports transfer as discussed above. 4. Denying Transfer Would Not Support Judicial Economy Data Scape's argument that judicial economy weighs against transfer because the Northern District "would need to generate a docket and assign a judge with no familiarity with the patents," does not withstand scrutiny. See Opp. at 16. For one, Data Scape cannot credibly assert an interest in judicial economy when it has filed 17 lawsuits in five different Districts within two months. See Mot. at 3, Ex. 2. But in any event, Data Scape does not even attempt to 4 Even in Casey on Behalf of RVNB Holdings, Inc. Employee Stock Ownership Plan v. Reliance Tr. Co., No. 4:18- CV-00424, 2018 WL7138386, at *3 (E.D. Tex. Dec. 12, 2018), which Data Scape cites, the court found transfer was supported by the defendant's identification of third-party witnesses, even if those witnesses were not shown to be unwilling to attend trial. Id. at *4-5, n.3. 4 address Dropbox's arguments, supported by case law, that patent cases are to be treated separately, this Court has no more expertise in the patents at this early stage than a Northern District of California judge would have, and Data Scape may not create its own judicial economy by filing multiple suits in a single District. See Mot. at 15-16, 18-19. 5. Court Congestion Does Not Weigh Against Transfer Data Scape's contention that court congestion weighs against transfer because the median time to trial in patent cases is greater in the Northern District of California than in the Western District of Texas (opp. at 17-18) should be rejected for three reasons. First, by any measure, the Northern District of California promptly tries patent infringement actions, and Data Scape does not even argue that it is congested. Second, Data Scape has voluntarily filed numerous co- pending infringement actions in jurisdictions with far slower dockets. See Mot., Ex. 2. And third, the average time to trial in patent cases is 31.9 months in the Western District of Texas and a marginally longer 34.4 months in the Northern District of California (see Lantier Decl. at ¶¶ 12-13, Exs. 7-8). That minimal difference is insufficient to overcome all of the other transfer factors. Both Courts have patent-case specific procedures, patent case expertise, and will try the case in a reasonable time. Any fair comparison leads to the conclusion this factor is neutral. 6. San Francisco Clearly Has A Stronger Localized Interest Finally, Data Scape's contention that the local interest factor is neutral (opp. at 18) fails. As Dropbox emphasized in its Motion, this factor favors transfer when, as here, "defendants are headquartered, develop the accused products, and employ a large number of people in the transferee venue." Uniloc, 2018 WL 2729202 at *4 (citation omitted). See Mot. at 17. Dated: May 15, 2019 Respectfully submitted, /s/ J. Stephen Ravel 5 J. Stephen Ravel Texas State Bar No. 16584975 KELLY HART & HALLMAN LLP 303 Colorado St., Ste. 2000 Austin, TX 78701 Telephone: (512) 495-6400 Fax: (512) 495-6401 steve.ravel@kellyhart.com Gregory H. Lantier (Admitted Pro Hac Vice) DC Bar No. 492043 Virginia State Bar No. 65657 New York State Bar No. 4823217 WILMER HALE LLP 1875 Pennsylvania Avenue Washington DC 20006 Tel: (202) 663-6327 Email: gregory.lantier@wilmerhale.com Monica Grewal (Admitted Pro Hac Vice) Massachusetts State Bar No. 659449 Connecticut State Bar No. 414009 WILMER HALE LLP 60 State Street Boston, Massachusetts 02109 Email: monica.grewal@wilmerhale.com Yvonne Lee (Admitted Pro Hac Vice) Massachusetts State Bar No. 687623 WILMER HALE LLP 60 State Street Boston, Massachusetts 02109 Tel: (617) 526-6692 Email: yvonne.lee@wilmerhale.com Alexis Pfeiffer (Admitted Pro Hac Vice) California State Bar No. 312007 WILMER HALE LLP 950 Page Mill Road Palo Alto, California 94304 Tel: (650) 858-6052 Email: alexis.pfeiffer@wilmerhale.com ATTORNEYS FOR DEFENDANT DROPBOX, INC. 6