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ILife Technologies Inc v. Nintendo Of America Inc

United States District Court, N.D. Texas, Dallas Division

June 27, 2017

ILIFE TECHNOLOGIES, INC., Plaintiff,
v.
NINTENDO OF AMERICA, INC., Defendant.

          MEMORANDUM OPINION AND ORDER

          BARBARA M. G. LYNN CHIEF JUDGE

         Before the Court is Nintendo of America, Inc.'s Motion to Dismiss or Transfer for Improper Venue Under 28 U.S.C. § 1406(a) [ECF No. 206]. On June 23, 2017, the Court heard oral argument on the Motion. As stated on the record at the hearing, the Motion is DENIED. The Court now issues this Memorandum Opinion and Order describing its reasons for denying the Motion.

         1. Background

         iLife filed this patent infringement suit on December 23, 2013. Nintendo filed its Answer on April 28, 2014. In ¶ 7 of the Answer, Nintendo stated:

Defendant admits that venue is proper in this District pursuant to 28 U.S.C. §§ 1391 and 1400(b). Defendant denies that the Northern District of Texas is a convenient venue for this dispute and reserves the right to transfer pursuant to 28 U.S.C. § 1404.

         Answer ¶ 7.

         On April 29, 2014, Nintendo filed a Motion to Transfer Venue pursuant to § 1404(a).

         Nintendo broadly argued that the convenience factors under § 1404(a) supported a transfer to the Western District of Washington, where Nintendo's headquarters are located in Redmond, Washington. In the alternative, Nintendo asked for the case to be transferred to the Northern District of California. Neither the motion nor the reply mentioned § 1406. After oral argument on the § 1404 Motion, the Court denied Nintendo's Motion to Transfer. The Court noted that Nintendo's headquarters were in Redmond, Washington, but that most of Nintendo's witnesses would be travelling from Japan, and the difference in distance between Washington and Texas for foreign witnesses was not significant for venue purposes. Nintendo moved for reconsideration of the denial, which the Court denied.

         On November 28, 2014, Nintendo moved to file its Amended Answer to assert an affirmative defense of inequitable conduct. The Court granted Nintendo's motion; the Amended Answer contained the same paragraph on venue as Nintendo's first Answer:

Defendant admits that venue is proper in this District pursuant to 28 U.S.C. §§ 1391 and 1400(b). Defendant denies that the Northern District of Texas is a convenient venue for this dispute and reserves the right to transfer pursuant to 28 U.S.C. § 1404.

         Am. Answer [ECF No. 61] ¶ 7.

         On May 22, 2017, the Supreme Court decided TC Heartland LLC v. Kraft Foods Group Brands LLC, 137 S.Ct. 1514 (2017), holding that for purposes of the patent venue statute, a corporation “resides” only in its state of incorporation. Nintendo moves to dismiss or transfer this case to the Western District of Washington under § 1406(a), contending that in light of TC Heartland, venue is improper in the Northern District of Texas. Jury selection and the pretrial conference for this case is scheduled for August 14, 2017. Trial is scheduled to begin the week of August 21, 2017.

         2. Legal Background

         Section 1400(b), the patent venue statute, provides that:

Any civil action for patent infringement may be brought in the judicial district where the defendant resides, or where the defendant has committed acts of infringement and has a regular and established place of business.

         28 U.S.C. § 1400(b); see also Act of June 25, 1948, ch. 646, 62 Stat. 869, 936.

         In Fourco Glass Co. v. Transmirra Products Corp., 353 U.S. 222, 226 (1957), the Supreme Court considered the relationship between § 1400(b) and the general venue statute, § 1391. The Supreme Court had earlier considered a similar question in Stonite Products. Co. v. Melvin Lloyd Co., 315 U.S. 561 (1942), specifically whether Section 48 of the Judicial Code, governing venue in patent litigation, was supplemented by Section 52, the general venue provision that predated Section 48.[1] In Stonite, the Court held that Section 52 did not alter the scope of Section 48, which was “the exclusive provision controlling venue in patent infringement proceedings, ” and enacted as “a restrictive measure, limiting a prior, broader venue.” Id. at 566. “Congress did not intend the Act of 1897 to dovetail with the general provisions relating to the venue of civil suits, but rather that it alone should control venue in patent infringement proceedings.” Id. at 565.

         In 1948, the current version of the patent venue statute, § 1400(b), was enacted. Act of June 25, 1948. Ch. 646, 62 Stat. 869, 936. The general venue statute was amended in the same enactment, and consisted of one sentence which read:

(c) A corporation may be sued in any judicial district in which it is incorporated or licensed to do business or is doing business, and such judicial district shall be regarded as the residence of such corporation for venue purposes.

Id. at 935.

         The Supreme Court in Fourco was again called upon to consider the interplay between the patent venue statute and the general venue statute. When discussing the significance of recent changes made to § 1391 and § 1400(b), the Supreme Court held that for purposes of § ...


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