Court Opinion

ID: 9927222
Source: CourtListenerOpinion
Date Created: 2024-01-26 16:01:48.493166+00
Date Added: 2024-06-11T09:24:05.620771
License: Public Domain

Case: 23-152    Document: 11     Page: 1    Filed: 01/26/2024

           NOTE: This order is nonprecedential.

   United States Court of Appeals
       for the Federal Circuit
                  ______________________

    In re: HONEYWELL INTERNATIONAL INC.,
                     Petitioner
              ______________________

                         2023-152
                  ______________________

    On Petition for Writ of Mandamus to the United States
District Court for the Western District of Texas in No. 6:21-
cv-00843-ADA, Judge Alan D. Albright.
                  ______________________

                      ON PETITION
                  ______________________

    Before DYK, BRYSON, and TARANTO, Circuit Judges.
PER CURIAM.
                        ORDER
    Honeywell International Inc. petitions for a writ of
mandamus directing the United States District Court for
the Western District of Texas to transfer this action to the
United States District Court for the Western District of
North Carolina. Lone Star SCM Systems, Ltd. opposes.
We conclude that the court’s denial of Honeywell’s motion
to transfer amounts to a clear abuse of discretion leading
to a patently erroneous result. We accordingly grant Hon-
eywell’s mandamus petition and direct transfer.
Case: 23-152    Document: 11       Page: 2   Filed: 01/26/2024

2                      IN RE: HONEYWELL INTERNATIONAL INC.

                              I.
    Lone Star, an apparent patent assertion entity based
in the Northern District of Texas, brought this action in the
Waco Division of the Western District of Texas. See Appx1,
Appx27. Lone Star’s complaint charges Honeywell, a Del-
aware corporation headquartered in Charlotte, North Car-
olina, with induced and contributory infringement of four
patents related to radio frequency identification (RFID)
used to track items.
    Honeywell moved to transfer the case to the Western
District of North Carolina pursuant to 28 U.S.C. § 1404(a).
In support, Honeywell argued that the various RFID read-
ers and near-field communication devices accused of direct
infringement were designed, manufactured, imported, and
sold by Hand Held Products, Inc. (“Hand Held”), a Honey-
well subsidiary also headquartered in Charlotte with rele-
vant operations in nearby Fort Mill, South Carolina.
     Honeywell argued that any of its evidence and employ-
ees with relevant and material information would likely be
in the Western District of North Carolina. Honeywell also
identified in the Charlotte area five potential witnesses
from Hand Held, including its VP GM of Connected Supply
Chain who is knowledgeable about the development, mar-
keting, and sales of the accused products; two engineers
knowledgeable about the accused software and hardware
functionality; and two individuals with relevant and mate-
rial information related to marketing and sales.
    The district court denied Honeywell’s motion. At the
outset, the court found that this action could have been
brought in the Western District of North Carolina, satisfy-
ing the threshold requirement for transfer under section
1404(a). The district court then analyzed the private-inter-
est and public-interest factors that the Fifth Circuit has di-
rected courts to use in making transfer decisions under
section 1404(a). See In re Volkswagen of Am., Inc., 545 F.3d
304, 315 (5th Cir. 2008) (en banc)) (“Volkswagen II”).
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IN RE: HONEYWELL INTERNATIONAL INC.                         3

    With respect to the private interest factors, the court
noted that the bulk of the relevant evidence would likely
come from Honeywell and Hand Held and found that the
sources of proof factor at least slightly favored transfer
given the location of document custodians in the Western
District of North Carolina. The court also determined that
the compulsory process factor at least slightly favored
transfer, noting primarily the presence of the Hand Held
employees identified as potential witnesses within the sub-
poena power of the transferee court.
    Turning to the convenience of the potential witnesses,
the district court noted that at least one Honeywell em-
ployee witness, its Chief Intellectual Property Counsel, re-
sides in the Western District of North Carolina, and that
no party identified any potential party witnesses in the
Western District of Texas. Nonetheless, the court con-
cluded that this factor weighed against transfer based on
the location of Lone Star’s President, Secretary, and Chief
Technologist in the Northern District of Texas.
    With respect to the public interest factors, the court de-
termined that the local interest factor at least slightly
weighed in favor of transfer because of the presence of rel-
evant Hand Held employees in that district. However, be-
cause Lone Star had two co-pending lawsuits against other
defendants in the Western District of Texas alleging in-
fringement of the same patents, the court found that the
practical problems factor weighed against transfer. The re-
maining factors, the court found, were neutral. On bal-
ance, the court concluded that Honeywell had failed to
demonstrate that the Western District of North Carolina
was clearly more convenient and denied transfer.
                             II.
    We apply regional circuit law when reviewing motions
to transfer under § 1404(a). In re Juniper Networks, Inc.,
14 F.4th 1313, 1318 (Fed. Cir. 2021). In applying Fifth Cir-
cuit law, we have recognized that a district court enjoys
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4                      IN RE: HONEYWELL INTERNATIONAL INC.

broad discretion in making a transfer determination. See
In re Vistaprint Ltd., 628 F.3d 1342, 1344 (Fed. Cir. 2010).
However, when a district court’s denial of a motion to
transfer clearly contravenes governing legal standards
leading to a patently erroneous result, we have issued man-
damus to overturn the denial of transfer. See, e.g., In re Ap-
ple Inc., 979 F.3d 1332, 1346 (Fed. Cir. 2020).
    Under Fifth Circuit law, transfer “should be granted if
the movant demonstrates that the transferee venue is
clearly more convenient.” In re Radmax, Ltd., 720 F.3d
285, 288 (5th Cir. 2013) (quoting Volkswagen II, 545 F.3d
at 315 (internal quotation marks omitted)). Honeywell
satisfied that standard here. The district court itself deter-
mined that the sources of proof, compulsory process, and
localized interest factors all favor transfer to the Western
District of North California. The district court denied
transfer based on its assessment of the willing witness and
practical problems factors. But a study of the record here
makes clear that the only connection between this case and
the Western District of Texas is that it appears that Lone
Star prefers to file its suits there.
     The district court correctly determined that the local
interest factor favored transfer. It appears undisputed
that Honeywell and Hand Held officials and employees in
the transferee venue were involved in the design and de-
velopment of the accused products. See Def. Distrib. v.
Bruck, 30 F.4th 414, 435 (5th Cir. 2022) (noting that the
local interest factor “‘most notably regards not merely the
parties’ significant connections to each forum writ large,
but rather the significant connections between a particular
venue and the events that gave rise to a suit.’” (quoting Ap-
ple., 979 F.3d at 1345)). Although the district court ex-
pressed the view that the District of South Carolina has a
greater local interest than the Western District of North
Carolina, this factor still clearly favors transfer, as the
Western District of Texas has no meaningful connection to
the events that gave rise to this infringement suit.
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IN RE: HONEYWELL INTERNATIONAL INC.                       5

     The district court also reasonably determined that the
sources of proof factor favored transfer to the Western Dis-
trict of North Carolina. Custodians of relevant records
from both Honeywell and Hand Held are located there.
Notwithstanding potential document custodians in Texas,
the court here reasonably concluded that this factor
weighed in favor of transfer because most of the evidence
would be coming from the transferee venue. See In re
Genentech Inc., 566 F.3d 1338, 1345 (Fed. Cir. 2009) (“In
patent infringement cases, the bulk of the relevant evi-
dence usually comes from the accused infringer.”) (internal
quotation marks and citation omitted)).
    Moreover, and perhaps most significantly, the court
recognized that the location of potential witnesses associ-
ated with Hand Held in the greater Charlotte area favored
the transferee forum. Several Hand-Held employees
knowledgeable about the design, development, functioning,
marketing, and sales of the accused products reside within
100 miles of the transferee court. Maintaining this case in
the Western District of Texas would not be convenient for
those witnesses. Moreover, because these potential wit-
nesses reside within 100 miles of the transferee court,
transfer ensures that the Western District of North Caro-
lina could compel those individuals to appear for both dep-
osition and trial. See Fed. R. Civ. P. 45(c)(1).
    The court found that the convenience of the willing wit-
nesses weighed against transfer, pointing to the presence
of three Lone Star employees in Texas. Those individuals,
however, do not live in the Western District of Texas, and
it appears they will need to travel more than 100 miles to
reach either forum, though admittedly their travel to the
Western District of North Carolina would be more exten-
sive. Furthermore, the court noted that it was unclear
what, if any, relevant and material information these indi-
viduals have. See Appx13. With Honeywell’s employee
witness in the Western District of North Carolina and no
willing witness identified in the Western District of Texas,
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6                      IN RE: HONEYWELL INTERNATIONAL INC.

it cannot fairly be said that the willing witness factor sup-
ports keeping this case in Waco, Texas. See In re TikTok,
Inc., 85 F.4th 352, 359 (5th Cir. 2023) (“[T]he court erred
by comparing Texas with California when it should have
been comparing the Western District of Texas with the
Northern District of California.”).
     Lone Star also defends the district court’s decision to
deny transfer based on judicial economy considerations re-
lated to having one court resolve this case and two other
infringement suits Lone Star had brought in the Western
District of Texas against different defendants. We have
held under similar circumstances, however, that the “incre-
mental gains” in judicial economy that might result from
“keeping these cases in the Western District of Texas
simply are not sufficient to justify overriding the inconven-
ience to the parties and the witnesses.” In re Samsung El-
ecs. Co., Ltd., 2 F.4th 1371, 1380 (Fed. Cir. 2021).
    In Samsung, as in this case, the infringement action
lacked any legitimate mooring to the Western District of
Texas relating to the location of parties, witnesses, or evi-
dence. The district court nonetheless denied transfer based
largely on judicial economy grounds, even though the un-
derlying accused products across the different suits in-
volved “entirely different underlying application[s],” id. at
1379. We granted mandamus and directed transfer, noting
that the cases were likely to “result in significantly differ-
ent discovery, evidence, proceedings, and trial.” Id. at 1380
(internal quotation marks and citation omitted). To the ex-
tent that there are remaining overlapping invalidity or in-
fringement issues, we noted that “the MultiDistrict
Litigation Procedures exist to effectuate this sort of effi-
ciency.” Id. (internal quotation marks and citation omit-
ted).
    The same reasoning applies here: Lone Star’s other
suits in the Western District of Texas involve different de-
fendants with different hardware and different software
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IN RE: HONEYWELL INTERNATIONAL INC.                         7

and are therefore likely to involve significantly different
discovery, evidence, and issues. While Lone Star may pre-
fer to litigate its cases in Western Texas, that is not enough
to overcome Honeywell’s showing that the Western District
of North Carolina is the clearly more convenient venue.
See generally Volkswagen II, 545 F.3d at 314 (holding that
the burden of demonstrating that the transferee forum is
clearly more convenient “reflects the appropriate deference
to which the plaintiff’s choice of venue is entitled”).
    In sum, as in TikTok and other recent cases in which
this court and the Fifth Circuit have granted mandamus,
several important transfer factors favor transfer, while
nothing of significance ties this case to the Western District
of Texas. See 85 F.4th at 366. For these reasons, we hold
that the decision to deny transfer was a “clear abuse of dis-
cretion leading to a patently erroneous result.” Id. (inter-
nal quotation marks and citation omitted). We therefore
grant Honeywell’s petition seeking transfer of this case to
the Western District of Northern Carolina.
    Accordingly,
    IT IS ORDERED THAT:
    The petition is granted. The district court’s order deny-
ing transfer is vacated, and the district court is directed to
grant the transfer motion.
                                              FOR THE COURT

January 26, 2024
    Date