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Federal Circuit Denies Petition for Mandamus to Direct Transfer of Case from Eastern District of Texas to Michigan

09-M897
May 22, 2009

Decision icon Decision

Last Month at the Federal Circuit - June 2009

Judges: Gajarsa, Friedman, Linn (author)

[Appealed from: E.D. Tex., Judge Ward]

In In re Volkswagen of America, Inc., No. 09-M897 (Fed. Cir. May 22, 2009), the Federal Circuit denied the petition for a writ of mandamus to direct the U.S. District Court for the Eastern District of Texas to transfer a patent case to the Eastern District of Michigan because the petitioner did not make a sufficient showing to justify mandamus relief.

MHL, Tek, LLC (“MHL”) is a small Texas company operating out of Rochester Hills, Michigan. MHL initiated two lawsuits in the Eastern District of Texas asserting patent infringement against a total of thirty foreign and U.S. automobile companies, including Volkswagen of America, Inc., Volkswagen AG, and Audi AG (collectively “Volkswagen”). Volkswagen Group of America, Inc. filed a DJ action against MHL regarding the same patents in the Eastern District of Michigan. A district court in the Eastern District of Michigan transferred the DJ action to the Eastern District of Texas to avoid wasting judicial resources and the risk of inconsistent rulings on the same patents. In In re Volkswagen of America, Inc., 296 F. App’x 11 (Fed. Cir. 2008), the Federal Circuit denied a writ of mandamus to vacate the Eastern District of Michigan’s transfer order. The Texas district court then denied Volkswagen’s request to transfer the first of MHL’s lawsuits to the Eastern District of Michigan, citing, inter alia, the judicial economy that would result from a single court deciding all related patent issues. Volkswagen then filed a petition for a writ of mandamus with the Federal Circuit to direct the Eastern District of Texas to vacate its denial order and transfer the case pursuant to 28 U.S.C. § 1404(a).

The Federal Circuit reminded that mandamus relief in § 1404(a) cases is only permitted when the petitioner can demonstrate that the denial of transfer was a “clear” abuse of discretion such that refusing transfer produced a “patently erroneous result.” Slip op. at 4 (citing In re Volkswagen of Am., Inc., 545 F.3d 304, 312 (5th Cir. 2008)). The Court applied Fifth Circuit law in considering the “public” and “private” factors for determining forum non conveniens when assessing whether a defendant has met its burden of demonstrating the need to transfer. The Court found that “the existence of multiple lawsuits involving the same issues is a paramount consideration when determining whether a transfer is in the interest of justice.” Id. Because the Court found significant overlap in the issues in the three lawsuits, it concluded that familiarity with the patents could preserve time and resources. After finding that the district court’s decision to deny transfer was based on the rational argument that judicial economy is served by having the same court try the cases involving the same patents, the Court denied Volkswagen’s petition for a writ of mandamus.

 

Summary authored by Eli Mazour, student associate at Finnegan.