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Peloton Interactive, Inc. v. Flywheel Sports, Inc.

United States District Court, E.D. Texas, Marshall Division

May 30, 2019

PELOTON INTERACTIVE, INC., Plaintiff,
v.
FLYWHEEL SPORTS, INC., Defendants.

          MEMORANDUM ORDER

          ROY S. PAYNE, UNITED STATES MAGISTRATE JUDGE.

         Defendant Flywheel Sports, Inc. (hereinafter “Flywheel”) filed a Motion to Transfer Pursuant to 28 U.S.C. § 1404(a), which is now before the Court. (Dkt. No. 17.)[1] This Motion seeks to transfer this case from the Eastern District of Texas to the Southern District of New York. Proper venue is not contested, as both parties have regular and established places of business in this district and Plaintiff has more than 100 employees at its “second headquarters” in the district. After consideration of the parties' briefing, the Court finds that Flywheel has not established that venue would be clearly more convenient in the SDNY.

         I. APPLICABLE LAW

         “For the convenience of parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought or to any district or division to which all parties have consented.” 28 U.S.C. § 1404(a). To determine whether venue transfer is appropriate under § 1404(a), the Fifth Circuit has adopted several private and public interest factors. In re Volkswagen of Am., Inc., 545 F.3d 304, 315 (5th Cir. 2008) (“Volkswagen II”). The private interest factors include (1) the availability of compulsory process to secure the attendance of witnesses; (2) the cost of attendance for willing witnesses; (3) the relative ease of access to sources of proof; and (4) all other practical problems that make trial of a case easy, expeditious, and inexpensive. Id. The public interest factors include (1) the administrative difficulties flowing from court congestion; (2) the local interest in having localized interests decided at home; (3) the familiarity of the forum with the law that will govern the case; and (4) the avoidance of unnecessary problems of conflict of laws. Id.

         A plaintiff's choice of venue is not an express factor in the analysis. Seven Networks, LLC v. Google LLC, 2:17-CV-00442-JRG, 2018 U.S. Dist. LEXIS 146375, at *8 (citing Volkswagen II, 545 F.3d at 315). However, a moving defendant must demonstrate that the proposed venue is clearly more convenient that the original venue. Id. (citing Volkswagen II, 545 F.3d at 315). By applying this heightened standard, the plaintiff's choice of forum is given the appropriate deference. Id. (citing Volkswagen II, 545 F.3d at 315).

         Motions to transfer venue “are to be decided based on ‘the situation which existed when suit was instituted.'” Evolutionary Intelligence, LLC v. Apple, Inc., No. 6:12-cv-00783, 2013 U.S. Dist. LEXIS 187467, *11 (E.D. Tex. Aug. 27, 2013) (quoting In re EMC Corp., 501 Fed.Appx. 973, 976 (Fed. Cir. 2013) (quoting Hoffman v. Blaski, 363 U.S. 335, 343 (1960))). However, the analysis may consider circumstances that were “apparent at the time the suit was filed.” In re EMC Corp., 501 Fed.Appx. at 976.

         “‘A district court should assess the relevance and materiality of the information the witness may provide' and where a party has ‘identified witnesses relevant to [the] issues [present in a case], [] the identification of those witnesses weighs in favor of [the identifying party].'” Seven Networks, 2018 U.S. Dist. LEXIS 146375, at *8 (quoting In re Genentech, Inc., 566 F.3d 1338, 1344 (Fed.

         Cir. 2009)). “[T]o properly analyze convenience, specific witnesses should be identified with, at a minimum, a general statement providing the expected relevant and material information to the litigation at hand.” Realtime Data, LLC v. Rackspace US, Inc., 2017 WL 772653, at *10 (E.D. Tex. Feb. 28, 2017).

         II. ANALYSIS

         As an initial matter, the Court notes that this case could have been brought in the S.D.N.Y. Peloton does not contest this point. (Dkt. No. 25 at 2.) Accordingly, the Court focuses its analysis on the convenience factors to see whether SDNY is a clearly more convenient forum than EDTX.

         The parties do not argue that either “the avoidance of unnecessary problems of conflict of laws” or the “familiarity of the forum with the law that will govern the case” factors weigh one way or the other. (Dkt. No. 17 at 14; see Dkt. No. 25 at 11-15 (providing no discussion of these factors when addressing the public interest factors).) The Court therefore finds these factors to be neutral. The Court will address each of the remaining public and private interest factors below.

         a. The availability of compulsory process to secure the attendance of witnesses

         This factor is directed towards unwilling third-party witnesses. Seven Networks, 2018 WL 4026760, at *7 (citing Volkswagen II, 545 F.3d at 316). Flywheel identifies Yu Feng[2] and Christopher Sira, who were inventors of the asserted patents. (Dkt. No. 17 at 8; U.S. Pat. No. 9, 174, 085 at [72]; U.S. Pat. No. 9, 233, 276 at [72].) However, Feng is a party witness as he currently serves as Peloton's Chief Technology Officer. (Dkt. No. 25 at 7 (citing Foley Decl. at ¶ 4).) Further, Sira is willing to attend the trial, making compulsory process unnecessary for him. (Id. (citing Dkt. No. 25-6 at ¶ 4).) Accordingly, the Court concludes that Feng and Sira would be more appropriately considered under other factors and that they do not provide support for this factor.

         Flywheel also identifies Eric Villency and Joseph Coffey of the Villency Design Group (hereinafter “VDG”) as potential witnesses. (Dkt. No. 17 at 9.) However, the Court concludes that Villency and Coffey do not provide any support for a transfer to SDNY.

         VR Optics, LLC., a company owned by Villency and Coffey, is currently asserting U.S. Patent No. 6, 902, 513 (hereinafter “'513 Patent”) against Peloton in SDNY, [3] and Peloton filed a third-party complaint in that action against Villency, Coffey, and VDG, which is another company owned by Villency and Coffey. VR Optics, Dkt. No. 57 at 1-2. VR Optics, LLC purchased the '513 Patent and then sued Peloton for infringement in VR Optics. VR Optics, Dkt. No. 1 at ...


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