N.D. and E.D. Tex. Courts Find Waiver of Venue Defense Notwithstanding TC Heartland Decision

Jun 29, 2017

Reading Time : 2 min

Elbit Systems v. Hughes Network Systems commenced in 2015 with Elbit suing multiple defendants in the Eastern District of Texas on patents relating to broadband satellite systems. Although the complaint asserted venue under both 28 U.S.C. § 1391 and § 1400(b), the subsequent motions to dismiss on venue grounds contested venue within only § 1391(c)(2). The court denied the motions under then-existing law. On June 3, roughly two weeks after TC Heartland, (and with a trial date set for the end of July), defendants filed motions to transfer under 28 U.S.C. § 1406 for improper venue and to stay pending resolution of venue.

In Judge Payne’s decision denying both motions, he first acknowledged that venue is a defense that, if available, is waived if it is not raised at the outset of the case pursuant to Federal Rules of Civil Procedure 12(h)(1)(A) and 12(g)(2). The court decided, however, that the venue defense always had been available and reasoned that TC Heartland did not change the law; it reaffirmed that the Supreme Court’s 1957 decision in Fourco had been the law all along. The court so held notwithstanding the Federal Circuit’s 27-year old precedent in VE Holding that was binding on all district courts presiding over patent infringement cases. While defendants argued that because of VE Holding it was “well known” that any motion under 1400(b) would have been viewed as “meritless . . . that does not change the harsh reality that Hughes would have ultimately succeeded in convincing the Supreme Court to reaffirm Fourco, just as the petitioner in TC Heartland did.”

Similarly, the court in iLife Technologies, Inc. v. Nintendo of America, Inc. was confronted with a motion to transfer with a fast-approaching trial date. Although in its Answer Nintendo admitted venue was proper under §§ 1391 and 1400(b), it filed a motion to transfer venue under 28 U.S.C. § 1404, which was ultimately denied. Following TC Heartland, Nintendo renewed its motion to transfer or dismiss under 28 U.S.C. § 1406. The plaintiff opposed the motion on two grounds: that TC Heartland did not constitute a “change in law,” and that even if it did, it would not qualify for an exception under Fifth Circuit law.

The court held that TC Heartland did not constitute a change in law, and accordingly did not reach the issue of waiver under Fifth Circuit law.

Both of these decisions were in mature cases with trial dates fast approaching – a factor that likely impacted the ultimate conclusion.

Elbit Systems Land and C4I Ltd. et al v. Hughes Network Systems LLC et al, 2-15-cv-00037 (E. D. Tex, June 20, 2017, Order)

iLife Technologies, Inc. v. Nintendo of America, Inc., 3-13-cv-04987 (N.D. Tex. June 27, 2017, Order) (Lynn, USDJ)

Share This Insight

Previous Entries

IP Newsflash

November 5, 2024

The Federal Circuit vacated a district court’s fee award because the district court considered certain information that was not relevant to the question of whether plaintiff’s case was exceptional. Specifically, the Federal Circuit held that only those “red flags” that related to the successful Section 101 defense, which served as the basis for the district court’s grant of summary judgment, could be used to show the case was fatally flawed.   

...

Read More

IP Newsflash

November 1, 2024

The Federal Circuit’s decision in Kyocera Senco Industrial Tools Inc. v. International Trade Commission articulated a bright-line test for patent expert admissibility: to testify from the perspective of a “person of ordinary skill in the art” (POSITA), the expert must at least meet the definition of a POSITA for the patents-in-suit. Absent that level of skill, Kyocera holds that the witness’s testimony is not sufficiently reliable or relevant enough to be relied on by a fact-finder.

...

Read More

IP Newsflash

October 29, 2024

The PTAB denied a petitioner’s motion to compel routine discovery that sought information from a parallel ITC investigation for alleged inconsistent positions taken by patent owner in the IPR. The board found that patent owner had not taken inconsistent positions but warned patent owner that it had an ongoing duty to produce any information inconsistent with arguments made during the present IPR, even if that information related to arguments patent owner had dropped at the ITC.

...

Read More

IP Newsflash

October 11, 2024

The Central District of California ruled that the heightened pleading standard of Federal Rule of Civil Procedure 9(b) applies to all three prongs of a false patent marking claim, including the third prong, competitive injury. In doing so, took a clear stand on an issue with a nationwide split among district courts.

...

Read More

IP Newsflash

October 10, 2024

In a patent case containing a variety of federal and state law claims, the District of Massachusetts retained supplemental jurisdiction over the state law claims even after all the federal law claims were dismissed.

...

Read More

IP Newsflash

October 3, 2024

The Federal Circuit recently upheld the USPTO’s authority under the estoppel provision 37 C.F.R. § 42.73(d)(3)(i) to prohibit a patent owner from obtaining patent claims that are not patentably distinct from claims previously declared unpatentable in inter partes review (IPR) proceedings. However, the court clarified that the regulation applies only to new claims or amended claims, not previously issued claims.

...

Read More

IP Newsflash

September 27, 2024

In Kyocera Senco Industrial Tools Inc. v. International Trade Commission, the Federal Circuit held that an expert must meet the definition of a “person of ordinary skill in the art” of the asserted patents in order to opine on infringement, among other issues. This new bright-line test and the underlying rationale, however, raised several new questions regarding expert admissibility. SeeFederal Circuit: Narrow Definition of Skill in the Art Dooms Expert’s Testimony” and “Grappling With A Bright-Line Patent Expert Admissibility Test.” The Federal Circuit recently addressed one of those questions, namely whether an expert must have acquired the requisite level of skill as of the time of the invention or whether it is sufficient for an expert to acquire that knowledge at a later date.

...

Read More

IP Newsflash

September 23, 2024

The Director of the USPTO initiated sua sponte review of a PTAB panel’s decision to impose sanctions based on patentee’s conduct during IPR proceedings. The PTAB cancelled all of patentee’s claims, including those not unpatentable on the merits, after finding that patentee deliberately withheld data relevant to the patentability of the claims at issue. In her review, the Director addressed which regulations are implicated upon a party’s misconduct during AIA proceedings and addressed whether entry of judgment in the trial was an appropriate sanction.

...

Read More

© 2024 Akin Gump Strauss Hauer & Feld LLP. All rights reserved. Attorney advertising. This document is distributed for informational use only; it does not constitute legal advice and should not be used as such. Prior results do not guarantee a similar outcome. Akin is the practicing name of Akin Gump LLP, a New York limited liability partnership authorized and regulated by the Solicitors Regulation Authority under number 267321. A list of the partners is available for inspection at Eighth Floor, Ten Bishops Square, London E1 6EG. For more information about Akin Gump LLP, Akin Gump Strauss Hauer & Feld LLP and other associated entities under which the Akin Gump network operates worldwide, please see our Legal Notices page.