Opinion
CIVIL ACTION NO. 3:02-CV-2538-G
May 23, 2003
MEMORANDUM ORDER
Before the court is the motion of the defendants Trans Globe Imports, Inc. ("T-G Imports"), Trans Globe Lighting, Inc. ("T-G Lighting"), and Bel Air Lighting, Inc. ("Bel Air") (collectively, "the defendants") to transfer this case, pursuant to 28 U.S.C. § 1404 (a), to the United States District Court for the Central District of California. For the reasons discussed below, the defendants' motion is granted.
Although the defendants make a passing reference to a possible lack of personal jurisdiction by this court, they have presented absolutely no evidence or argument in support of that assertion. See Memorandum in Support of the Motion of Defendants Trans Globe Imports, Inc., Trans Globe Lighting, Inc., and Bel Air Lighting, Inc. to Transfer this Action to the Central District of California at 1. Consequently, the court construes the instant motion solely as a motion to transfer.
I. BACKGROUND
This case involves a patent dispute between Minka Lighting, Inc. ("Minka"), T-G Imports, T-G Lighting, and Bel Air. Plaintiff Minka is a California corporation with its principal place of business in Corona, California. See First Amended Complaint ("Amended Complaint") ¶ 1. Minka is in the business of designing, distributing, marketing, and selling light fixtures. Id. ¶ 9. Defendants T-G Imports, T-G Lighting, and Bel Air are California corporations with their principal places of business in North Hollywood, California. Id. ¶¶ 2-4; Memorandum in Support of the Motion of Defendants Trans Globe Imports, Inc., Trans Globe Lighting, Inc., and Bel Air Lighting, Inc. to Transfer this Action to the Central District of California ("Defendants' Motion") at 2. At all times relevant to the instant dispute, T-G Imports, T-G Lighting, and Bel Air were in the business of importing, distributing, and selling light fixtures. See Amended Complaint 10; Defendants' Motion at 2. Minka and T-G Lighting have both utilized showrooms at the Dallas Market Center (the "DMC") in Dallas, Texas where they offered light fixtures for sale. See Amended Complaint ¶ 10; Defendants' Motion at 2.
The record reflects that T-G Imports and T-G Lighting merged with Bel Air sometime in July 2002. See Amended Complaint ¶ 5; Defendants' Motion at 2; Plaintiff's Opposition to Defendants' Motion to Transfer Venue ("Plaintiff's Opposition") at 2.
According to Minka, Bel Air — as the successor-in-interest of T-G Lighting — has continued to operate a showroom at the DMC. See Plaintiff's Opposition at 5.
On November 22, 2002, Minka filed its original complaint in this case alleging patent infringement, unfair competition, and unjust enrichment. See Original Complaint ¶¶ 11-33. On January 31, 2003, Bel Air responded by filing a declaratory judgment action in the United States District Court for the Central District of California, Western Division, styled Bel Air Lighting, Inc. v. Minka Lighting, Inc., Civil No. EDCV 03-126-VAP(SGLx), seeking a declaration that various Minka patents — the same patents at issue in this action — are invalid and not infringed by any product made, imported, or sold by Bel Air. See Defendants' Motion at 1-2; Plaintiff's Opposition at 3. On February 7, 2003, the defendants filed the instant motion to transfer this action to the United States District Court for the Central District of California. See Docket Sheet.
The patents at issue here are: United States Design Patent Nos. 454, 654 (issued Mar. 19, 2002); 455,515 (issued Apr. 9, 2002); and 455,856 (issued Apr. 16, 2002). Minka claims that its patented products were properly "marked" pursuant to 35 U.S.C. § 287 (a). See Amended Complaint ¶¶ 11-13, 15.
On March 14, 2003, the defendants filed a request for the court to judicially notice that: (1) the municipality of Orange, California is located in Orange County, California, (2) the municipality of Temecula, California is located in Riverside County, California, and (3) the municipality of Corona, California is likewise located in Riverside County, California. See Request for Judicial Notice by Defendants in Support of Reply to Opposition at 1. Because the counties in which these cities are located is "capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned," see FED. R. EVID. 201(b)(2), the defendants' request is granted.
II. ANALYSIS A. The Legal Standard
A district court may transfer any civil case "[f]or the convenience of parties and witnesses, in the interest of justice, . . . to any other district or division where it might have been brought." 28 U.S.C. § 1404 (a). The purpose of Section 1404(a) "is to prevent the waste `of time, energy, and money' and `to protect litigants, witnesses and the public against unnecessary inconvenience and expense. . . .'" Van Dusen v. Barrack, 376 U.S. 612, 616 (1964) (quoting Continental Grain Company v. Barge FBL-585, 364 U.S. 19, 26, 27 (1960)). The decision to transfer a pending case is committed to the sound discretion of the district court. Jarvis Christian College v. Exxon Corporation, 845 F.2d 523, 528 (5th Cir. 1988); see also Balawajder v. Scott, 160 F.3d 1066, 1067 (5th Cir. 1998), cert. denied, 526 U.S. 1157 (1999); Caldwell v. Palmetto State Savings Bank, 811 F.2d 916, 919 (5th Cir. 1987). Generally, the plaintiff is afforded some deference in choosing a forum. Time, Inc. v. Manning, 366 F.2d 690, 698 (5th Cir. 1966); Lindloff v. Schenectady International, 950 F. Supp. 183, 185 (E.D. Tex. 1996). However, the plaintiffs choice of forum has reduced significance where most of the operative facts occurred outside the district. Lindloff, 950 F. Supp. at 185; see also Robertson v. Kiamichi R.R. Company, LLC, 42 F. Supp.2d 651, 656 (E.D. Tex. 1999). The plaintiff's forum choice is also given less weight when the plaintiff brings suit outside its home district. Hanby v. Shell Oil Company, 144 F. Supp.2d 673, 677 (E.D. Tex. 2001); Rock Bit International, Inc. v. Smith International, Inc., 957 F. Supp. 843, 844 (E.D. Tex. 1997); Alexander Alexander, Inc. v. Donald F. Muldoon Company, 685 F. Supp. 346, 348-49 (S.D.N.Y. 1988).
In deciding whether to transfer a case, the court should consider (1) the convenience of the parties, (2) the convenience of material witnesses, (3) the availability of process to compel the presence of unwilling witnesses, (4) the cost of obtaining the presence of witnesses, (5) the relative ease of access to sources of proof, (6) calendar congestion, (7) where the events in issue took place, and (8) the interests of justice in general. D. T. Systems, Inc. v. SOS Company, Inc., Civil No. 3:01-CV-1560-G, 2002 WL 413898 at *3 (N.D. Tex. Mar. 14, 2002) (Fish, CJ); Gundle Lining Construction Corporation v. Fireman's Fund Insurance Company, 844 F. Supp. 1163, 1165 (S.D. Tex. 1994). Each of these factors will be analyzed to determine whether this case should be transferred to the United States District Court for the Central District of California.
B. Factor (1): The Convenience of the Parties
It is undisputed that all named parties in this case are California corporations with their principal places of business in the Central District of California. See Defendants' Motion at 1-3; Amended Complaint ¶¶ 1-4. Certainly, it would be more convenient and economical for California corporations to litigate this matter in their home district rather than halfway across the country in the Northern District of Texas. Minka has failed to offer sufficient evidence to call this common-sense conclusion into doubt. Therefore, because all parties are residents of the proposed transferee district, this factor weighs strongly in favor of transferring this action to the Central District of California.
The Central District of California consists of the following counties: Los Angeles County, Orange County, Riverside County, San Bernardino County, San Luis Obispo County, Santa Barbara County, and Ventura County. 28 U.S.C. § 84 (c).
C. Factors (2), (3), and (4): The Convenience of Material Witnesses, Availability of Process, and Cost of Obtaining Witnesses
The convenience of the witnesses is often regarded as the most important factor to be considered in deciding whether to transfer venue. Travelers Indemnity Company of America v. National Union Fire Insurance Company of Pittsburgh, Pennsylvania, No. 3:02-CV-0585-G, 2002 WL 1575409 at *2 (N.D. Tex. July 16, 2002) (Fish, CJ); Gundle, 844 F. Supp. at 1166; Fletcher v. Southern Pacific Transportation Company, 648 F. Supp. 1400, 1401-02 (E.D. Tex. 1986). However, it is the convenience of the non-party witnesses that is accorded the greatest weight. Travelers Indemnity, 2002 WL 1575409 at *2; Gundle, 844 F. Supp. at 1166.
Here, the defendants allege that all of their currently known material witnesses are located in California and obtaining the presence of these witnesses for trial in Dallas would be inconvenient and costly. Defendants' Motion at 5; see also Reply of Defendants Trans Globe Imports, Inc., Trans Globe Lighting, Inc., and Bel Air Lighting, Inc. to the Opposition of Minka Lighting, Inc., to Motion to Transfer Venue ("Defendants' Reply") at 8-9. Two of the witnesses identified by the defendants, Robert De'Armond and Rolando Hidalgo, are the inventors of the patents allegedly infringed. See Defendants' Motion at 5; Original Complaint, Exhibit 1. Both inventors appear to be party witnesses who reside within the Central District of California. Defendants' Motion at 5; Plaintiff's Opposition at 9. The remaining witnesses are corporate representatives of Environmental Lighting for Architecture, Inc. and Maxim Lighting International, Inc., which, like the parties to this action, are California companies located in the Central District of California. See Defendants' Motion at 5-6; Defendants' Reply at 8-9. According to the defendants, these corporate representatives are material non-party witnesses who possess key information on the substantive issues of this case. Defendants' Motion at 5; Defendants' Reply 8-9. The defendants also note that the corporate representatives and any other non-party witness residing in California will be outside the court's one-hundred mile subpoena range. See Defendants' Motion at 5-6; Defendants' Reply at 8-9; see also FED. R. CIV. P. 45(b)(2).
Specifically, the defendants claim that the corporate representatives will testify as to the sale and printed description of lighting products produced by their respective companies that "have each significant feature claimed in the asserted patents." Declaration of David Ziv in Support of Motion to Transfer Venue ¶¶ 9-10.
Federal Rule of Civil Procedure 45(b)(2) provides, in pertinent part, that "a subpoena may be served at any place within the district of the court by which it is issued, or at any place without the district that is within 100 miles of the place of the deposition, hearing, trial, production, or inspection specified in the subpoena."
In response, Minka argues that "Dallas will be convenient for many third-party witnesses since it is centrally located and due to Dallas' concentration of lighting fixture companies." See Plaintiff's Opposition at 8. Minka also stresses the preeminence of the DMC in the national light fixture market. See id. at 7-8. However, the only witnesses identified by Minka are unnamed Dallas sales representatives for both Minka and the defendants, who, presumably, are party witnesses. See id. at 8-9. Minka has therefore failed to identify any material nonparty witness who will be inconvenienced by the transfer of this case to the Central District of California. Consequently, the convenience of material witnesses, the availability of process, and the relative cost of obtaining the presence of witnesses weigh in favor of transferring this case to the Central District of California.
The court notes that, even if these local sales representatives are material non-party witnesses, the factors at issue would, at best, be deemed neutral considering the number of material witnesses for the defense who reside in the transferee district.
D. Factors (5) and (7): Where the Events Took Place and Sources of Proof
In a patent infringement action, the preferred forum is that which is the center of gravity of the accused activity. S.C. Johnson Son, Inc. v. Gillette Company, 571 F. Supp. 1185, 1187-88 (N.D. Ill. 1983)); accord Laitram Corporation v. Hewlett-Packard Company, 120 F. Supp.2d 607, 609 (E.D. La. 2000); Proshot Golf Inc. v. Leading Edge Technologies, Inc., Civil No. 3:96-CV-1906-D, 1996 WL 673265 at *2 (N.D. Tex. Oct. 31, 1996). Indeed, "[t]he trier of fact ought to be as close as possible to the milieu of the infringing device and the hub of activity centered around its production." S.C. Johnson, 571 F. Supp. at 1188. In finding that center of gravity, a district court should consider the location of a product's development, testing, research, and production. S.C. Johnson, 571 F. Supp. at 1188; see also Laitram Corporation, 120 F. Supp.2d at 609; Proshot Golf, 1996 WL 673265 at *2. Additionally, a court should consider the place where the marketing and sales decisions occurred, not just the location of any particular sales activity. S.C. Johnson, 571 F. Supp. at 1188. The location of the alleged infringer's principal place of business, therefore, is often the critical and controlling consideration in adjudicating a motion to transfer venue. Houston Trial Reports, Inc. v. LRP Publications, Inc., 85 F. Supp.2d 663, 668 (S.D. Tex. 1999) (citations omitted).
In this instance, the defendants assert that all of the events at issue took place in California and that the sources of proof, consisting primarily of documentary evidence and physical exhibits, are located in California. See Defendants' Motion at 5, 7. Minka responds by alleging that the sales records for its DMC showroom are maintained in Dallas and that, in all likelihood, the sales records for the defendants' DMC showroom or, at the very least, from the Dallas International Lighting Show, are also located in Dallas. See Plaintiff's Opposition at 10. Minka further states that, due to the defendants' use of a DMC showroom, a sufficient amount of infringing activities have occurred in this district. See id. at 7. Minka, however, has wholly failed to explained why, in a suit alleging patent infringement throughout the nation, the sales records kept in Dallas, even when the strength of the light fixture market here is assumed, would be more beneficial than the nationwide sales records maintained at the parties' corporate headquarters in California. Moreover, regardless of any particular sales at the DMC, the "center of gravity" of the accused activity — i.e., the place where product development, testing, research, and production as well as any marketing and sales decisions occurred — is most likely the defendants' home offices in the Central District of California. Consequently, the factors concerning the locus of the events in issue and access to sources of proof weigh in favor of transferring this action to the Central District of California.
E. Factor (6): Calendar Congestion
The Northern District of Texas and the Central District of California appear to be comparable with respect to the amount of time needed to adjudicate a civil dispute. See Judicial Caseload Profiles for the United States District Court for the Northern District of Texas and the United States District Court for the Central District of California, attached to Declaration of David A. McDonald in Support of Motion to Transfer Venue, as Exhibits A and B. This factor thus has neutral weight in the analysis.
F. Factor (8): The Interest of Justice
Although a plaintiffs forum choice is clearly a factor to be considered in the venue transfer analysis, "in and of itself it is neither conclusive nor determinative." In re Horseshoe Entertainment, 305 F.3d 354, 358-59 (5th Cir. 2002) (citing Garner v. Wolfinbarger, 433 F.2d 117, 119 (5th Cir. 1970)); Shoemake v. Union Pacific R.R. Company, 233 F. Supp.2d 828, 830 (E.D. Tex. 2002). Here, Minka's choice of forum is given less weight because few, if any, of the operative facts appear to have occurred within this district and Minka is not a resident of this state. Dearing v. Sigma Chemical Company, 1 F. Supp.2d 660, 665 (S.D. Tex. 1998); Quicksilver, Inc. v. Academy Corporation, No. 3:98-CV-1772-R, 1998 WL 874929 at *4 (N.D. Tex. Dec. 3, 1998) (citing Piper Aircraft Company v. Reyno, 454 U.S. 235, 255-56 (1981)); Lindloff, 950 F. Supp. at 185; Fletcher, 648 F. Supp. at 1404.
For venue purposes, the law draws a distinction between a corporate defendant's residence and a corporate plaintiff's residence. "While a corporate defendant resides in its state of incorporation as well as any district in which it is licensed to do business or is doing business, a corporate plaintiff resides only in its state of incorporation. See 28 U.S.C. § 1391 (c); Carter-Beveridge Drilling Company v. Hughes, 323 F.2d 417, 418 (5th Cir. 1963); see also 15 WRIGHT, MILLER COOPER, FEDERAL PRACTICE AND PROCEDURE 2d § 3811 (1986). Minka is a California corporation; thus, it is not a resident of the Northern District of Texas.
Consequently, Minka's choice of forum — which is given diminished importance due to this district's lack of ties to the dispute and to the parties — is not enough to outweigh the balance of the other six factors discussed above that favor a transfer to the Central District of California. See Shoemake, 233 F. Supp.2d at 830-31; Hanby, 144 F. Supp.2d at 677; Robertson, 42 F. Supp.2d at 656; Rock Bit, 957 F. Supp. at 844.
Although Minka additionally asserts that the presence of Dallas counsel should be taken into consideration, see Plaintiff's Opposition at 8, this factor is "irrelevant and improper" in determining the question of transfer of venue. See Horseshoe Entertainment, 305 F.3d at 358. Moreover, even if "local counsel" were a factor to be considered, it appears that both Minka and the defendants have retained counsel in the Central District of California so that this factor would have neutral weight in the analysis. See Defendants' Reply at 7-8 and n. 4.