Judge Sleet grants defendants’ motion to transfer to Northern District of California

Chief Judge Gregory M. Sleet recently granted defendants’ joint motion to transfer venue to the Northern District of California in this patent infringement action. Linex Technologies, Inc. v. Hewlett-Packard Company, et al., C.A. No. 11-400-GMS (D. Del. Jan. 7, 2013). Plaintiff was a Delaware corporation “with small offices in Florida, New Jersey, Massachusetts, and Texas.” Id. at 2. One defendant was a California corporation, the remaining four were Delaware corporations, and all five had their principal places of business in the Northern District of California. Id.

Plaintiff’s forum preference was entitled “to at least somewhat heightened deference” because it had filed the action in its state of incorporation, which was “part of its home turf.” Id. at 5 (internal quotation marks omitted). However, the forum preference received “something less than . . . paramount consideration” because the plaintiff had filed its action in a district in which it was not physically located. Id. at 5 (citing, inter alia, In re Link_A_Media Devices Corp., 662 F.3d 1221, 1223 (Fed. Cir. 2011)).

All other Jumara factors weighed in favor of transfer or were neutral. The physical location of the defendants and relevant evidence in California influenced the Court’s analysis of several factors. The Court acknowledged that key witnesses and books and records were in or near the Northern District of California in its conclusion that these two factors weighed in favor of transfer, albeit only “slightly” for books and records. Id. at 9-11. The “practical considerations” within Jumara’s public interest factors weighed in favor of transfer “[f]or largely the same reasons that the court found the [books and records and convenience of witnesses] factors to weigh in favor of transfer.” Id. at 12.

As to the convenience of the parties, while “not all defendants have chosen to incorporate in Delaware, and the court is cognizant of In re Link_A_Media‘s general warning to avoid weighing a defendant’s state of incorporation too heavily in the transfer analysis,” here “the decisions of [four defendants] to incorporate in Delaware do suggest that the inconvenience of litigating here is somewhat less than the court would ordinarily presume it to be. As such, the court [found] that this factor [was] neutral.” Id. at 8-9.

On the other hand, these “same underlying facts [i.e., the physical location of the defendants in California] in its assessment of [the] ‘practical considerations’ factor” favored transfer: “[a]s a matter of form, the fact that [all but one of the defendants were] incorporated in Delaware did affect the private interest, party convenience analysis. The public interest factor at issue here, however, calls for the court to examine practical considerations rather than ones of form, and there is little reason to believe a California-based firm actually reduces its costs of litigating in this district merely by incorporating in Delaware. Put simply, the concern that prevented the court from concluding that the ‘convenience of the parties’ factor favored transfer is inapplicable here, and the court believes that the parties’ aggregate litigation costs will be reduced by litigating in California.” Id. at 12.

Linex Technologies, Inc. v. Hewlett-Packard Company, et al., C.A. No. 11-400-GMS (D. Del. Jan. 7, 2013) by YCSTBlog

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