Can an Intervenor Cause Improper Venue?

by Dennis Crouch

In re Intex Recreation Corp., No. 18-131 (Fed. Cir. June 13, 2018) (denial of mandamus) [IntexMandamus]

Team Worldwide (TWW) sued Wal-Mart in E.D. Texas for infringing its U.S. Pat. Nos. 9,211,018, 7,346,950, and 7,246,394 (air mattress products).  Wal-Mart does not make the accused products but does sell them.  The manufacturers (Intex, Coleman, and Bestway) are all contractually bound to indemnify Wal-Mart and intervened to defend their products. After intervening the manufacturers then demanded that the case be severed and transferred to their chosen districts (Intex to C.D. Cal; Coleman to N.D. Ill, and Bestway to Arizona). The district court refused — holding that the manufacturers had waived any objection to venue by intervening.

The Federal Circuit has now denied the manufacturers’ petition for writ of mandamus:

  1. No Need for Speed: Ordinarily appeals are only filed following a final judgment in a case. Writ of mandamus effectively allows for immediate interlocutory appeals, but requires a petitioner to show a need for immediate decision.  Here, petitioners did not prove why immediacy is necessary.  Rather, the court found that the manufacturers can simply wait and address their improper venue defense after trial is complete.
  2. Clear and Indisputable Right to Relief: Neither the Federal Circuit nor the 5th Circuit have not spoken directly as to whether “a party that voluntarily enters a case through intervention may raise a venue defense.” However, some amount of parallel jurisprudence supports the district court decision.  “Given the substantial amount of authority supporting the district court’s decision, we cannot say that Petitioners’ entitlement to relief is clear and indisputable.”

Petition denied.

Severing: A secondary aspect of the petition decision involves the question of joinder/severing under Section 299 of the Patent Act.  The district court held that Section 299 did not apply here because the manufacturers had not been joined together but rather voluntarily intervened (and the patentee never alleged infringement against the manufacturers).  In its decision here denying mandamus the Federal Circuit noted that even if Section 299 is inapplicable, the rules of civil procedure provide a district court with authority to sever claims in order to better ensure “fundamental fairness” or avoid prejudice. FRCP 21; See  In re EMC Corp., 677 F.3d 1351 (Fed. Cir. 2012).  Thus, although denying mandamus, the appellate panel has instructed the district court to “consider whether such concerns warrant severance for the purposes of adjudicating the merits of the case.”

 

13 thoughts on “Can an Intervenor Cause Improper Venue?

  1. 1

    Intervening – by definition – is “stepping into the shoes of.”

    Those shoes are located not per the person stepping into them, but rather the original person whose shoes those are.

    Is there a reason why this direct point is not front and center?

    1. 1.1

      Are you sure you know what that word means? I do not think it means what you think it means.

    2. 1.2

      I’m curious as to where you found that definition?

      1. 1.2.1

        Ditto.

      2. 1.2.2

        Same. Also wondering why all of anon’s comments have the same tone of indignant person who just soiled himself.

      3. 1.2.3

        I am sure that it is at least implicit in any definition that you may want to use.

        Feel free to pick one if you don’t like mine.

        1. 1.2.3.1

          Your argument kind of falls apart if we use “my” definition, e.g., “coming between.” With my definition, everyone gets to keep their own shoes.

          1. 1.2.3.1.1

            Hmm, you are correct – I should have added that here, the context is that the intervening is being done by way of contract, and it is by way of that contract, that the shoes are as I indicated.

            Mea culpa.

            1. 1.2.3.1.1.1

              and i think your ultimate conclusion is correct, i.e., that the district court was right. it doesn’t make any sense to allow someone to voluntarily step in, but then let them say “oh, but not here…”

    3. 1.3

      From wikipedia: “In law, intervention is a procedure to allow a nonparty, called intervenor (also spelled intervener) to join ongoing litigation, either as a matter of right or at the discretion of the court, without the permission of the original litigants. The basic rationale for intervention is that a judgment in a particular case may affect the rights of nonparties, who ideally should have the right to be heard.”

      And from link to legal-dictionary.thefreedictionary.com: “An individual who is not already a party to an existing lawsuit but who makes himself or herself a party either by joining with the plaintiff or uniting with the defendant in resistance of the plaintiff’s claims.”

      Doesn’t sound like stepping into someone else’s shoes. Sounds like stepping up to the side of someone, or interposing oneself between that person and another person. But not assuming the place of.

      1. 1.3.1

        Yup – see above.

    4. 1.4

      An intervenor does NOT step in the shoes of another party. The whole point of intervention is that the party seeking to intervene has a separate interest in the litigation from the named party. It is absolutely not equivalent to stepping in the shoes of the named party.

      And there is no often reason for intervention in the case of an indemnification situation like this. Just like an insurance company, a manufacturer that is indemnifying a retailer can simply counsel for the retailer-defendant, and move to transfer, without having to formally intervene.

      1. 1.4.1

        That’s certainly all true, but the question is whether you determine venue based on the facts of the defendant or the intervenor. Here Wal-Mart was sued in the E.D.Tex. The intervenors, I gather, are smaller companies who are manufacturers and are located around the country. Wal-Mart, I think, is much more likely to be subject to venue there than the intervenors.

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