Court Opinion

ID: 6346569
Source: CourtListenerOpinion
Date Created: 2022-06-03 14:03:32.692441+00
Date Added: 2024-06-11T09:18:11.380732
License: Public Domain

Case: 22-122    Document: 12   Page: 1     Filed: 05/05/2022

          NOTE: This order is nonprecedential.

   United States Court of Appeals
       for the Federal Circuit
                  ______________________

               In re: ZTE CORPORATION,
                          Petitioner
                   ______________________

                         2022-122
                  ______________________

    On Petition for Writ of Mandamus to the United
States District Court for the Western District of Texas in
Nos. 6:20-cv-00487-ADA, 6:20-cv-00488-ADA, 6:20-cv-
00489-ADA, 6:20-cv-00490-ADA, 6:20-cv-00491-ADA,
6:20-cv-00492-ADA, 6:20-cv-00493-ADA, 6:20-cv-00494-
ADA, 6:20-cv-00495-ADA, 6:20-cv-00496-ADA, and 6:20-
cv-00497-ADA, Judge Alan D. Albright.
                 ______________________

                      ON PETITION
                  ______________________

     Before MOORE, Chief Judge, DYK and PROST, Circuit
                       Judges.
MOORE, Chief Judge.
                       ORDER
    ZTE Corporation (“ZTE”) petitions for a writ of man-
damus directing the United States District Court for the
Western District of Texas to vacate its January 3, 2022
order denying transfer and to transfer to the United
States District Court for the Northern District of Texas.
Case: 22-122    Document: 12     Page: 2     Filed: 05/05/2022

2                                    IN RE: ZTE CORPORATION

WSOU Investments LLC opposes.              For the following
reasons, we deny ZTE’s petition.
                       BACKGROUND
     WSOU filed these cases in the Western District of
Texas in June 2020, accusing ZTE and its subsidiaries
ZTE (USA), Inc. (“ZTA”) and ZTE (TX), Inc. (“ZTX”)
(collectively, “the ZTE entities”) of patent infringement.
In October 2020, each defendant filed a motion principally
seeking to dismiss or transfer under 28 U.S.C. § 1406(a).
ZTE’s motion included an alternative request to transfer
under 28 U.S.C. § 1404(a) to the Northern District of
Texas if the court transferred the claims against ZTA and
ZTX to that district. Appx363–65.
    After WSOU amended its complaints on November 6,
2020, the ZTE entities filed a second, joint motion to
dismiss or transfer under § 1406(a) on December 4, 2020.
That joint motion also included an alternative request to
transfer to the Northern District of Texas under § 1404(a),
but the district court issued an order striking the transfer
portion of the motion as untimely on December 11, 2020,
based on a previously issued scheduling order. On De-
cember 30, 2020, the ZTE entities moved to stay all other
proceedings pending resolution of venue.
    On August 6, 2021, the district court agreed to dis-
miss only ZTA and ZTX for improper venue. ZTE moved
for reconsideration, arguing, among other things, that
judicial economy would benefit from either dismissal of all
the defendants or transfer because it was highly likely
that WSOU would refile against ZTA and ZTX in the
Northern District of Texas or that ZTE would file a de-
claratory judgment action there. The district court denied
reconsideration on September 3, 2021, reasoning that “to
the extent there is a judicial efficiency concern here, that
concern remains hypothetical.” Appx508.
Case: 22-122    Document: 12     Page: 3   Filed: 05/05/2022

IN RE: ZTE CORPORATION                                    3

    On September 7, 2021, ZTA filed a declaratory judg-
ment action in the Northern District of Texas, challenging
the same patents asserted in the present actions. On
September 10, 2021, the Western District of Texas re-
quested supplemental briefing “in light of the new devel-
opments which raise[] a judicial economy concern,” noting
that it was “only interested in briefing regarding transfer
under [28 U.S.C. §] 1404(a), with an emphasis on judicial
economy.” Appx510. In its brief, ZTE argued that the
court should not apply the first-to-file rule and should
transfer the case to the Northern District of Texas to then
be consolidated with ZTA’s now-pending parallel litiga-
tion.
    On December 6, 2021, ZTE was informed that its stay
request would not be granted. On January 3, 2022, the
district court denied ZTE’s request to transfer to Northern
Texas. Appx1–2. The district court reasoned that these
actions have been proceeding “at a relatively fast pace,”
including that claim construction briefing had finished,
fact discovery had progressed for months, and the district
court had resolved several discovery disputes. Appx2. It
noted that the only substantive action in the Northern
Texas case was briefing of a motion to dismiss or stay also
concerning the first-to-file issues. The district court thus
did “not find that transferring these actions to the [North-
ern District of Texas] would promote the efficient resolu-
tion of the disputes between the parties or judicial
economy” and denied transfer. Id. This petition followed.
                         DISCUSSION
    A writ of mandamus is a “drastic and extraordinary
remedy reserved for really extraordinary causes.” Cheney
v. U.S. Dist. Ct. for D.C., 542 U.S. 367, 380 (2004) (inter-
nal quotation marks and citation omitted). A petitioner
must satisfy three requirements: (1) the petitioner must
“have no other adequate means to attain the relief” de-
sired; (2) the petitioner must show that the “right to
Case: 22-122    Document: 12      Page: 4    Filed: 05/05/2022

4                                     IN RE: ZTE CORPORATION

issuance of the writ is clear and indisputable”; and (3) the
petitioner must convince the court that the writ is “appro-
priate under the circumstances.” Id. at 380–81 (internal
quotation marks and citations omitted). We cannot
conclude this standard has been met here.
    ZTE argues that the district court should have ana-
lyzed and weighed judicial economy considerations, the
availability of sources of proof, the convenience of the
witnesses, and local interest considerations all in favor of
transferring to Northern Texas. Of those considerations,
we find that ZTE clearly raised in the district court only
judicial economy. We therefore do not consider the other
factors. See Fresenius USA, Inc. v. Baxter Int’l, Inc., 582
F.3d 1288, 1296 (Fed. Cir. 2009) (“If a party fails to raise
an argument before the trial court, or presents only a
skeletal or undeveloped argument to the trial court, we
may deem that argument waived on appeal . . . .” (citation
omitted)).
    ZTE’s supplemental transfer briefing did not itself
raise any argument concerning the sources of proof,
witnesses, and local interest factors. ZTE also was not
prevented from raising these arguments; to the contrary,
the district court informed the parties that it was “inter-
ested in briefing regarding transfer under [28 U.S.C.
§] 1404(a).” Appx510. Although the district court asked
for the parties to place an emphasis on the issue of judi-
cial economy, the district court did not prohibit, and
indeed invited, ZTE to present its argument for why this
case should be transferred under the statute. Rather
than raise these factors, ZTE elected to focus solely on
judicial economy.
     ZTE contends that it raised these arguments indirect-
ly in a one-line footnote in the brief saying it “incorporates
its transfer for convenience arguments previously raised”
in its October and December 2020 motions. Appx515 n.4.
But it has not shown a clear right to have arguments
Case: 22-122    Document: 12      Page: 5    Filed: 05/05/2022

IN RE: ZTE CORPORATION                                      5

raised in such a manner considered.           See generally
SmithKline Beecham Corp. v. Apotex Corp., 439 F.3d
1312, 1320 (Fed. Cir. 2006) (requiring arguments to
ordinarily be fully developed in the briefs and not in
footnotes); Graphic Controls Corp. v. Utah Med. Prods.,
Inc., 149 F.3d 1382, 1385 (Fed. Cir. 1998) (finding that an
argument raised in a footnote which in turn referenced
the full argument in the appendix was not preserved).
     Even if we considered those prior submissions, ZTE
still has not shown that it had clearly preserved these
arguments. ZTE’s October 2020 motion, which ZTE itself
argued was moot after the amended complaint, Appx117–
19, in fact, stated that these factors had “little bearing” on
these cases, Appx364. We have also not been asked
directly to overturn or been shown any clear and indis-
putable error that would warrant disturbing the court’s
December 11, 2020 order striking the transfer portion of
the ZTE entities’ December 2020 venue motion. Under
these circumstances, ZTE has failed to demonstrate a
clear right to have considerations other than judicial
economy weighed in favor of transfer.
    In denying ZTE’s transfer request, the district court
considered ZTE’s judicial economy arguments in the
context of applying the first-to-file rule, which “generally
favors pursuing only the first-filed action when multiple
lawsuits involving the same claims are filed in different
jurisdictions.” Merial Ltd. v. Cipla Ltd., 681 F.3d 1283,
1299 (Fed. Cir. 2012) (citations omitted); W. Gulf Mar.
Ass’n v. ILA Deep Sea Loc. 24, 751 F.2d 721, 730 (5th Cir.
1985). We see no clear and indisputable error in the
district court following that rule here. Although depar-
ture from the rule may be justified based on “considera-
tions of judicial and litigant economy,” Elecs. for Imaging,
Inc. v. Coyle, 394 F.3d 1341, 1347 (Fed. Cir. 2005) (inter-
nal quotation marks and citation omitted), the district
court here made a reasonable finding that such considera-
tions did not warrant an exception to the rule given the
Case: 22-122    Document: 12      Page: 6    Filed: 05/05/2022

6                                     IN RE: ZTE CORPORATION

progression of this litigation in Western Texas before the
second-filed action was commenced.
     ZTE cites to this court’s cases that have held that “[a]
district court’s decision to give undue priority to the
merits of a case over a party’s transfer motion should not
be counted against that party in the venue transfer anal-
ysis.” In re Apple Inc., 979 F.3d 1332, 1343 (Fed. Cir.
2020). But that analysis is not directly applicable to
ZTE’s circumstances, which do not involve a court relying
on the progress of a case that occurred while a transfer
motion was pending as the basis for denying that same
motion. ZTE instead asserts that the court should have
granted its stay request in December 2020 when it filed
the motion to dismiss, which would have resulted in none
of the progress cited by the district court that warranted
following the first-to-file rule here. But ZTE cites no clear
legal right, and we are not aware of any, to such a stay
here. See In re ADTRAN, Inc., 840 F. App’x 516, 517
(Fed. Cir. 2021) (denying mandamus relief to direct stay
of proceedings because of “no authority establishing a
clear legal right to a stay of all non-venue-related dead-
lines under circumstances where the venue-related mo-
tion is still in briefing and the Markman hearing is
months away”).
    ZTE also contends that this court should direct trans-
fer because the Northern District of Texas is the only
venue in which the related actions can be consolidated.
But denial of mandamus here does not leave the two
district courts without means to fulfill the first-to-file
rule’s objective of trying to avoid inconsistent judgments
or waste party and judicial resources. The parties in-
formed this court that the Northern District of Texas
action has been stayed pending the outcome of this peti-
tion. And WSOU has a pending motion to dismiss or stay
that action premised on application of the first-to-file rule.
    Accordingly,
Case: 22-122    Document: 12   Page: 7   Filed: 05/05/2022

IN RE: ZTE CORPORATION                                 7

    IT IS ORDERED THAT:
    The petition is denied.
                                FOR THE COURT

May 5, 2022                     /s/ Peter R. Marksteiner
  Date                          Peter R. Marksteiner
                                Clerk of Court