Virginia Lawyers Weekly VA Lawyers Weekly
A Virginia-based LLC that is owned by a Hong-Kong-based company, and is pursuing a patent infringement claim against a Taiwanese manufacturer, its Pennsylvania-based U.S. sales office, a Chinese corporation with its principal place of business in Hong Kong; a Delaware corporation with its principal place of business in California, and a California corporation, has its claim against the Chinese corporation dismissed for lack of service of process, and the Alexandria U.S. District Court transfers the claims against the remaining defendants to the Northern District of California for the convenience of the parties and witnesses, and in the interests of justice.
Defendants Microloops, HP and Dynatron seek transfer of this case to California. The parties sharply contest whether there is personal jurisdiction over Microloops and Dynatron in Virginia. The parties’ personal jurisdiction dispute focuses chiefly on whether jurisdiction is established based on a stream of commerce theory.
No evidence submitted by plaintiff Convergence establishes that Microloops or Dynatron directly delivered their products to Virginia, or placed their products in the stream of commerce with the knowledge that they would ultimately be sold in Virginia through an established distribution channel or otherwise. Significantly, unrefuted declarations submitted by Microloops and Dynatron establish that no allegedly infringing products were sold directly or indirectly in Virginia. On this record, no prima facie showing of personal jurisdiction over Microloops or Dynatron has been made.
California – which is considerably nearer than Virginia to the parties’ Hong Kong, Taiwan and California witnesses and documents – is a more convenient place for the parties to litigate this matter.
Convergence correctly argues that the comparative docket speeds of the transferor (E.D. Va.) and transferee (N.D. Cal.) courts weigh against transfer, the former according to Convergence averaging 10.2 months to trial and the latter 24.5 months to trial. Yet, these figures do not tell the whole story, as they are calculated averages for all types of civil cases. In this district, for example, patent cases, on average, take substantially longer to litigate than most civil cases. Given the Northern District of California’s well-earned reputation as an experienced patent district, the averages may well overstate the difference in docket speeds with respect to patent cases. The cost of reeducating new counsel in California is not a proper consideration here.
Application of the § 1404(a) and § 1406(a) factors to this case weighs in favor of transferring the patent infringement claim against Microloops, HP and Dynatron to the Northern District of California.
Convergence Technologies (USA) LLC v. Microloops Corp. (Ellis, J.) No. 1:09cv1256, May 11, 2010; USDC at Alexandria, Va. VLW 010-3-254, 31 pp.
