Rules for Transferring Cases Clarified

In re Volkswagen of America, Inc., 566 F.3d 1349 (Fed. Cir. 2009)
In re Genentech Inc., 566 F. 3d 1338 (Fed. Cir. 2009)

In two separate opinions, the Federal Circuit clarified the rules for transferring cases from the Eastern District of Texas, which has become known as a patentee-friendly forum. In both cases, the party seeking transfer did so on the basis of forum non conveniens, which means that a transfer is warranted for the convenience of the parties and witnesses, in the interests of justice.

In the first case, In re Genentech, the Federal Circuit granted a petition for mandamus to direct the Eastern District of Texas to transfer the case to California. In doing so, the court held that a motion to transfer venue should be granted when the transferee venue is clearly more convenient than the venue chosen by the plaintiff. The court added that there is no requirement, when seeking a transfer for the convenience of parties and witnesses, that a transferee court have jurisdiction over the plaintiff, only that it have jurisdiction over the defendant.

A court also need not evaluate the significance of an identified witnesses’ testimony when considering the convenience of witnesses, but need only determine whether the testimony is relevant and material to the case. In this case, the court also added that there were no witnesses or relevant documents in Texas, which also weighed in favor of transfer. In addition, the court noted that in a patent infringement case, the majority of relevant evidence belongs to the accused infringer, and so the location of the defendant’s documents weighs in favor of a transfer to that location.

Finally, unless all else is equal, the courts’ relative congestion is not a determinative factor. While denying a petition for a writ of mandamus, the Federal Circuit in In re Volkswagen noted the applicability of the factors outlined in Genentech. In Volkswagen, however, two other cases involving the same patents were also pending in the district. The court concluded that judicial economy was best served by having the same district court try all of the cases, adding that this was a “paramount consideration” when determining whether the transfer would serve the interests of justice.