Case 2:16-cv-00992-JRG Document 157 Filed 06/13/17 Page 1 of 8 PageID #: 1255
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`MARSHALL DIVISION
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`Civil Action No. 2:16-cv-992
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`)))))))))))))))
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`UNILOC USA, INC. and
`UNILOC LUXEMBOURG, S.A.,
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`Plaintiffs,
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`v.
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`MOTOROLA MOBILITY LLC,
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`Defendant.
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`DEFENDANT MOTOROLA MOBILITY LLC’S MOTION TO DISMISS
`OR, IN THE ALTERNATIVE, TRANSFER FOR IMPROPER VENUE
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`Pursuant to Federal Rule of Civil Procedure 12(b)(3) and 28 U.S.C. § 1406(a),
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`defendant Motorola Mobility LLC (“Motorola”) moves to dismiss this case for improper
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`venue.
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`Under the Supreme Court’s TC Heartland decision, which reversed longstanding
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`Federal Circuit law, venue in a patent infringement case is only proper: (1) where the
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`defendant resides, or (2) in a district where the defendant has a regular and established
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`place of business and has committed acts of infringement.1 Uniloc’s complaint does not
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`allege that Motorola meets either requirement for establishing venue in the Eastern District
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`of Texas. Accordingly, Motorola respectfully requests that the Court dismiss this case for
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`1 See TC Heartland LLC v. Kraft Foods-Group Brand LLC, Case No. 16-341, 581 U.S.
`___, 2017 WL 2216934, at *3, 7-8 (May 22, 2017).
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`
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`MARSHALL DIVISION
`
`Civil Action No. 2:16-cv-992
`
`)))))))))))))))
`
`UNILOC USA, INC. and
`UNILOC LUXEMBOURG, S.A.,
`
`Plaintiffs,
`
`v.
`
`MOTOROLA MOBILITY LLC,
`
`Defendant.
`
`DEFENDANT MOTOROLA MOBILITY LLC’S MOTION TO DISMISS
`OR, IN THE ALTERNATIVE, TRANSFER FOR IMPROPER VENUE
`
`Pursuant to Federal Rule of Civil Procedure 12(b)(3) and 28 U.S.C. § 1406(a),
`
`defendant Motorola Mobility LLC (“Motorola”) moves to dismiss this case for improper
`
`venue.
`
`Under the Supreme Court’s TC Heartland decision, which reversed longstanding
`
`Federal Circuit law, venue in a patent infringement case is only proper: (1) where the
`
`defendant resides, or (2) in a district where the defendant has a regular and established
`
`place of business and has committed acts of infringement.1 Uniloc’s complaint does not
`
`allege that Motorola meets either requirement for establishing venue in the Eastern District
`
`of Texas. Accordingly, Motorola respectfully requests that the Court dismiss this case for
`
`1 See TC Heartland LLC v. Kraft Foods-Group Brand LLC, Case No. 16-341, 581 U.S.
`___, 2017 WL 2216934, at *3, 7-8 (May 22, 2017).
`
`
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`Case 2:16-cv-00992-JRG Document 157 Filed 06/13/17 Page 2 of 8 PageID #: 1256
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`improper venue. In the alternative, Motorola requests that the Court transfer the case to the
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`Northern District of California pursuant to 28 U.S.C. § 1406(a).
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`I.
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`VENUE IS IMPROPER IN THE EASTERN DISTRICT OF TEXAS
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`In a patent case, venue lies only “in the judicial district where the defendant resides,
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`or where the defendant has committed acts of infringement and has a regular and
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`established place of business.” 28 U.S.C. § 1400(b); see TC Heartland, 2017 WL 2216934,
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`at *3. A corporate defendant “resides” only in its state of incorporation. See id. at *8. Thus,
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`for such a defendant, venue is proper only within “the judicial district” where it is
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`incorporated or where it “has committed acts of infringement and has a regular and
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`established place of business.” 28 U.S.C. § 1400(b).
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`Under TC Heartland and § 1400(b), venue is improper in this case. Motorola is
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`organized under the laws of Delaware as a limited liability company. (See Ex. 1; see also
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`Dkt. 1, Complaint ¶ 4 (alleging that Motorola is a “Delaware corporation”).) Motorola’s
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`headquarters and principal place of business are in Illinois. (Ex. 2, Merritt Decl. ¶ 3.) Thus,
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`Motorola does not “reside” in the Eastern District of Texas. See 28 U.S.C. § 1400(b); TC
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`Heartland, 2017 WL 2216934, at *2 (company “organized under Indiana law and
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`headquartered in Indiana” not resident in Delaware); Sperry Prods. v. Ass’n of Am. R.R.s,
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`132 F.2d 408, 411-412 (2d Cir. 1942) (holding, under predecessor of § 1400, that
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`unincorporated association did not reside outside of “its principal place of business”). Nor
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`does Motorola have a “regular and established place of business” in this district. Uniloc’s
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`complaint contains no allegations to the contrary—nor can it. Motorola has no facilities in
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`the Eastern District of Texas. (Merritt Decl. ¶ 4.)
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`
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`Case 2:16-cv-00992-JRG Document 157 Filed 06/13/17 Page 3 of 8 PageID #: 1257
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`Although TC Heartland issued after Uniloc filed its complaint in this action, the
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`holding of TC Heartland nevertheless applies because “the Supreme Court’s interpretation
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`of federal civil law ‘must be given full retroactive effect in all cases still open on direct
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`review and as to all events, regardless of whether such events predate or postdate the
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`Supreme Court’s announcement of the rule.’” NeuroRepair, Inc. v. The Nath Law Group,
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`781 F.3d 1340, 1345 (Fed. Cir. 2015) (quoting Harper v. Va. Dep't of Taxation, 509 U.S.
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`86, 97 (1993)). Accordingly, venue in this case is improper.
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`II.
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`THE COURT MUST DISMISS OR, IN THE ALTERNATIVE, TRANSFER
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`When venue is improper, as it is here, the district court “shall dismiss, or if it be in
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`the interest of justice, transfer such case to any district or division in which it could have
`
`been brought.” 28 U.S.C. § 1406(a). The Court has “broad discretion” in deciding whether
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`to dismiss or transfer, but it must do one or the other. See Caldwell v. Palmetto State Sav.
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`Bank of S.C., 811 F.2d 916, 919 (5th Cir. 1987); see, e.g., Payne v. Grayco Cable Servs.,
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`Inc., No. 1:11-CV-487, 2011 WL 13076902, at *4 (E.D. Tex. Dec. 8, 2011) (noting that
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`when venue is improper, “the court must either dismiss this lawsuit or transfer it to a
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`judicial district in which venue is proper under 28 U.S.C. § 1406(a)”) (emphasis added).
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`Motorola previously filed a motion to dismiss Plaintiffs’ complaint for failure to
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`state a claim upon which relief can be granted, pursuant to Federal Rule of Civil Procedure
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`12(b)(6). (See Dkt. 19 at 1.) Not until after the denial of that motion did Motorola’s
`
`objection to venue become “available” because TC Heartland had not been decided. (See
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`Fed. R. Civ. P. 12(g)(2).) Under the prior longstanding Federal Circuit law, venue in a
`
`patent infringement action was deemed proper in any judicial district in which the defendant
`
`
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`Case 2:16-cv-00992-JRG Document 157 Filed 06/13/17 Page 4 of 8 PageID #: 1258
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`was subject to personal jurisdiction. See VE Holdings Corp. v. Johnson Gas Appliance Co.,
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`917 F.2d 1574, 1583 (Fed. Cir. 1990). The Federal Circuit specifically found that an earlier
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`Supreme Court decision on point, Fourco Glass Co. v. Transmirra Products Corp., 353
`
`U.S. 222 (1957), was not controlling due to Congress’s amendment of 28 U.S.C. § 1391(c).
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`VE Holdings, 917 F.2d at 1579. The Federal Circuit reaffirmed its holding just last year.
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`See In re TC Heartland LLC v. Kraft Foods Group Brands LLC, 821 F.3d 1338, 1341 (Fed.
`
`Cir. 2016). It was only the Supreme Court’s recent TC Heartland decision, reversing the
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`governing Federal Circuit law, that held § 1391 inapplicable to patent cases, changing the
`
`law of venue.
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`Where, as here, there has been a change in governing circuit law, a defense
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`premised on the new law has not been waived. See, e.g., Curtis Pub. Co. v. Butts, 388 U.S.
`
`130, 143 (1967) (“the mere failure to interpose such a defense prior to the announcement of
`
`a decision which might support it cannot prevent a litigant from later invoking such a
`
`ground. . . . [A]n effective waive must . . . be one of a ‘known right or privilege.’”)
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`(citations omitted); Holzsager v. Valley Hospital, 646 F.2d 792 (2d Cir. 1981) (“[A] party
`
`cannot be deemed to have waived objections or defenses which were not known to be
`
`available at the time they could first have been made[.]”). This case is more than five
`
`months away from a Markman hearing, six months from the close of fact discovery, and
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`nearly a year from trial. (See Dkt. 95 at 1-2; Dkt. 154 at 3.) Accordingly, given the
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`relatively early stage of this case, dismissal is proper and Motorola’s motion should be
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`granted.
`
`
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`Case 2:16-cv-00992-JRG Document 157 Filed 06/13/17 Page 5 of 8 PageID #: 1259
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`Alternatively, should the Court exercise its discretion to transfer the case instead of
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`dismissing it, Motorola requests that the Court transfer this case to the Northern District of
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`California. The Fifth Circuit has affirmed transfer “in the interest of justice” under §
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`1406(a) “because ‘witnesses, evidence, the underlying events, and both defendants are
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`based there.’” See Moran v. Smith, 2016 U.S. Dist. LEXIS 97869, at *3-5 (W.D. Tex. July
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`27, 2016) (quoting Herman v. Cataphora, Inc., 730 F.3d 460, 466 (5th Cir. 2013)). The
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`Northern District of California is the appropriate district for transfer because Motorola has
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`an office in Sunnyvale, California, within the Northern District, and potential witnesses
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`and evidence are located there.
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`A. This Case Could Have Been Brought in Northern California
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`There is no dispute that this case could have been brought in the Northern District
`
`of California, as Motorola has a “regular and established place of business” in Sunnyvale,
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`California, where its employees are involved in the technologies at issue in this case. (Ex.
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`3, Tsuyemura Decl. ¶ 3.)3
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`B. Sources of Proof Are Centered In Northern California
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`Motorola’s offices in Sunnyvale, California, within the Northern District, employ
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`approximately 80 people. (Tsuyemura Decl. ¶ 3.) Among these are employees who work
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`on the design, development, and implementation of Motorola phones accused in plaintiffs’
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`infringement contentions. (Id.) Motorola documents concerning the design, manufacture,
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`3 As the accused Motorola devices are sold nationwide, Motorola does not dispute for
`purposes of this motion only, that the alleged “acts of infringement” occurred there. (See
`28 U.S.C. § 1400(b).)
`
`
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`Case 2:16-cv-00992-JRG Document 157 Filed 06/13/17 Page 6 of 8 PageID #: 1260
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`marketing, and sales of Android-based devices in the United States are accessible from or
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`located in its Sunnyvale, California offices. (Id.)
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`Moreover, plaintiffs have accused specific “instant voice messaging” functionality
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`of infringement.
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`(See, e.g., Dkt. 1, Complaint ¶¶ 11-29.) Nearly all of the documents
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`relating to that funcitonality, including highly proprietary information and source code, are
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`exclusively in the possesion of Google, Inc. in the Northern District of California.
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`(Tsuyemura Decl. ¶¶ 4-7.) This would give the Northern District of California subpoena
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`power over these third parties, rendering the Northern District of California a favorable
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`district for transfer. See Adaptix, Inc. v. HTC Corp., 937 F. Supp. 2d 867, 874 (E.D. Tex.
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`2013) (transfer is favored when a transferee district “has absolute subpoena power over a
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`great number of non-party witnesses.”). In addition, Motorola employees located in the
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`Northern District of California are likely to have relevant knowledge with respect to
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`Motorola’s work with these third parties. (See Tsuyemura Decl. ¶¶ 3, 5.)
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`C. Local Interest in the Case
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`Given the Motorola and third-party personnel located there, the Northern District of
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`California has a strong interest in adjudicating this dispute. See, e.g., Affinity Labs of Tex.
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`v. Samsung Elecs. Co., Ltd., 968 F. Supp. 2d 852, 855 (E.D. Tex. 2013) (“The Northern
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`District of California has an interest in protecting intellectual property rights that stem from
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`research and development in Silicon Valley.”). Furthermore, this lawsuit “calls into
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`question the work and reputation” of Motorola and its employees that conduct business in
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`the community, which gives the Northern District of California a unique interest. In re
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`Hoffman LaRoche, 587 F.3d at 1336.
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`
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`Case 2:16-cv-00992-JRG Document 157 Filed 06/13/17 Page 7 of 8 PageID #: 1261
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`III.
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`CONCLUSION
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`For the foregoing reasons, Motorola respectfully requests that the Court dismiss
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`this action for improper venue or, in the alternative, transfer this action to the Northern
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`District of California.
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`
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`Case 2:16-cv-00992-JRG Document 157 Filed 06/13/17 Page 8 of 8 PageID #: 1262
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`Dated: June 13, 2017
`
`/s/ Robert W. Unikel
`Robert W. Unikel (pro hac vice)
`Illinois State Bar No. 6216974
`ARNOLD & PORTER KAYE SCHOLER LLP
`70 W. Madison St., Suite 4200
`Chicago, IL 60602-4231
`Telephone: 312-583-2300
`Facsimile: 312-583-2360
`Email: robert.unikel@apks.com
`
`Jeffrey A. Miller (pro hac vice)
`California State Bar No. 160602
`ARNOLD & PORTER KAYE SCHOLER LLP
`3000 El Camino Real Five Palo Alto Square
`Palo Alto, CA 94306-3807
`Telephone: 650-319-4500
`Facsimile: 650-319-4700
`Email: jeffrey.miller@apks.com
`
`Paul I. Margulies (pro hac vice)
`DC Bar No. 1000297
`ARNOLD & PORTER KAYE SCHOLER LLP
`601 Massachusetts Ave, NW
`Washington, DC 20001
`Telephone: 202-942-5000
`Facsimile: 202-942-5999
`Email: paul.margulies@apks.com
`
`Counsel for Motorola Mobility LLC
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`CERTIFICATE OF SERVICE
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`I hereby certify that all counsel of record have been served a copy of the foregoing
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`on June 13, 2017, via electronic means.
`
`/s/ Robert W. Unikel
`
`
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