FedEx wins Mandamus: EDTX is too Inconvenient for the Multinational

by Dennis Crouch

In a non-precedential decision, the Federal Circuit today granted FedEx’s mandamus petition and ordered E.D.Tex. Judge Mazzant to reconsider his denial transfer.  In re FedEx Corp. Svcs., Inc., 22-156 (Fed. Cir. Oct 19, 2022). The decision here relates directly to the recent Patently-O guest post from Prof. Gugliuzza. Nonprecedential Precedent in Patent Venue Disputes.

R2 Solutions LLC (a Texas LLC and Acacia subsidiary) sued FedEx back in E.D.Tex (Sherman Division) back in 2021 alleging infringement of several former Yahoo! search-engine patents. U.S. Patent Nos. 8,190,610, 8,341,157, and 7,698,329.  Pre-2011, R2 would have filed a single lawsuits naming a number of defendants.  But, the joinder limitations of the AIA limited that approach and so instead R2 simultaneously filed several parallel lawsuits all in the same court against Walmart, Charles Schwab, Deezer, JP Morgan, Samsung, Target, Fidelity, Intel, Citigroup, Allegiant, CVS, State Farm, Redfin, Hilton, Booking.com, American Airlines, etc.

Although venue was proper, FedEx argued in its case that litigating in Sherman Texas was inconvenient and thus moved for transfer of venue under 28 U.S.C. § 1404(a) to Memphis (Western District of Tennessee) where the transportation giant is headquartered (although it is a Delaware company).  Judge Mazzant denied the motion in a 12-page written opinion.  R2_FedEx_Transfer_Denial.  At that point FedEx petitioned for mandamus and that has now been granted.

The mandamus order particularly calls-out Judge Mazzant for failing to explain his conclusions: “Here, the district court’s decision denying transfer lacks sufficient explanation for its findings and conclusions such that we cannot presently discern on limited mandamus review whether the denial of transfer was a patently erroneous result.”

Witnesses: The parties apparently hotly debated the location of potential witnesses.  Lots of FedEx folks in WDTN, but R2 found at least 10 potential FedEx witnesses in its EDTX Plano office.  On mandamus, the appellate court chastised Judge Mazzant for failing to make any findings or provide any explanations as to the relevance or importance of the various witnesses. Of course, this venue transfer motion is being made at the pleadings stage before discovery or substantial analysis of the case.  The Judge simply counted witnesses in each location, and according to the appellate court miscounted:

[W]hile R2 had identified 18 FedEx employees in EDTX, the court agreed with FedEx that four of those individuals are not FedEx employees (not shown to be willing witnesses otherwise) and another four are in WDTN. This suggests that the district court found there to be ten willing witnesses in each forum (ten identified by R2 in EDTX; six identified by FedEx and four identified by R2 in WDTN; and four non-willing witnesses). Nonetheless, the court concluded that there were more willing witnesses in EDTX, Appx 8. That conclusion does not match our understanding of the court’s apparent findings. This ambiguity further infects the analysis of the compulsory process factor since the court did not address the four additional non-willing witnesses that R2 alleged were subject to the court’s compulsory process.

Slip Op. Truthfully though, it is not clear exactly what the appellate panel is asking the district court to do — it seems like we need to take their testimony in order to determine whether it will be inconvenient to take their testimony.

Local Interest: One part of the convenience analysis is “local interest.” The district court found that local interest was in balance.  Although FedEx is headquartered in WDTN, R2 is a Frisco Texas company (Frisco is in EDTX). On appeal, the Federal Circuit concluded that R2’s local  interest is negligible despite being registered and headquartered in EDTX because it was only recently established. “Whatever de minimis local interest EDTX may have based on R2’s recently established, ephemeral in-district work address, it is nowhere near comparable to the local interest of WDTN, where events that gave rise to the suit largely occurred.” Slip Op.

A seeming important element of convenience in this case is that there are a dozen other parallel cases pending before the same court, and it makes sense to consider whether there will be overlapping witnesses in each case.  No consideration of that issue here.

On remand, the court will need to reconsider its prior transfer denial and likely will order transfer.

41 thoughts on “FedEx wins Mandamus: EDTX is too Inconvenient for the Multinational

  1. 5

    [A seeming important element of convenience in this case is that there are a dozen other parallel cases pending before the same court, and it makes sense to consider whether there will be overlapping witnesses in each case. No consideration of that issue here.]

    How would you take this factor into account? Once a troll manages to get proper venue against x defendants, it has free rein to sue all other defendants in the same venue?

    1. 5.1

      id,

      You lose credibility with your kool-aid stained lips and emphasis on the “0h N0es, Tr011s” propaganda.

      Your point below on corporate structures is NOT a patent law issue, as the entities you seek to chastise did NOT create the corporate law that they employ.

      This is not to say that I would disagree with changes to those laws (even throw in tax laws), but do not confuse those different laws with patent law issues.

      1. 5.1.1

        many decisions hold that other cases in the venue are not sufficient to defeat transfer when no other factor favors the venue

        1. 5.1.1.1

          Your response is not clear — are you indicating “many other cases” with different fact patterns?

          The inclusion of “when no other factor favors” seems to want to ig n0re THE presence of a factor that may in fact BE material.

          Can you clarify?

    1. 4.2

      super low — and nowhere near bottom yet.

      Per chance your call for others to buy matches your desire to sell…

      1. 4.2.1

        lol, hardly. But if so, my reach is superior since the volume at half-session was that of an entire normal days’. It was hard holding on thru the dips, but the dividend is what always kept me in. Sometimes I look at the performance of GS, MS over the past 5 years and note where they are today vs. their level 3 mos. immediately prior, and derive a factor of about 1.5, which is an indicator of a particular type of inflation. Do you think the 10 yr treasury will hit 5 pct before Thanksgiving ? Can volatility be tamed ?

      2. 4.2.2

        Lelz, I don’t sell much at all, as I have mostly solid long term holds, and I certainly won’t be selling any substantial amount in this dip.

        “super low — and nowhere near bottom yet.”

        Maybe. I would say there’s no more than a 10-20% drop realistically to be had.

          1. 4.2.2.1.1

            Nah, if it goes 20% lower I will be in the normal markets with leverage. I’m certainly not going to take a taxable event in order to switch from my solid long terms.

            My normal contribs right now are making bank in defi exploitin’. For example, one super profitable pool is LUNC/OSMO on Osmosis, made up 400 bucks on 2,500 put in over a mere 4 days, with 200 buck or so of that just straight fees collected (other 200 bucks price action). ETH-LINK pool on uniswap is just holding steady since the eth mini-crash after the merge tho. Still, 10 bucks a day in fees collected in that pool on 3.5k$ put in. There are many a good other opportunity in defi these days.

  2. 3

    Some may have denied that mandamus. So, its a Texas company suing a foreign corporation, when the minimum contacts are clearly met and convenience seems to be a main point. But convenience for a huge company FedEx is much less an issue due to its immense resources, compared to small company R2. To me, based on size, convenience is irrelevant, and I can’t see any public interest served by transfer.
    It is probably easy for the Tex. judge to reconsider the convenience re # of witnesses they’d not earlier discussed, and with some creativity, overcome the movant’s position, might reckon.

    1. 3.1

      But convenience for a huge company FedEx is much less an issue due to its immense resources…

      I think that you are oversimplifying this. Venue is about logistical convenience for the relevant witnesses and custodians of evidence, as well as for the rights of the affected jurisdiction to exercise their own justice. How do immense resources make the travel less inconvenient for the witnesses or custodians, relative to simply moving the trial to suit the convenience of the witnesses and custodians? If FedEx flies a mother from Tenn to Tex to participate in a trial, does that airfare that FedEx pays make it easier for her to get her kids to school in the morning? It seems to me that no matter how many expenses FedEx pays, it will still be more convenient for that mother if the trial were to happen in Tenn, so that she can attend to the ordinary domestic concerns of her quotidian life.

        1. 3.1.1.1

          This makes zero sense. The statute itself (28 USC 1404(a)) makes clear that transfer turns on convenience of both parties and witnesses.

          1. 3.1.1.1.1

            Maybe, but how is it implemented by the applicable rule ? These pre-trial procedures were cast before modern computer-enabled communications tech really hit the scene. I’m hinting at, with newer modern tech, the reasonings in the past concerning convenience have lost their relative importance, since even an entire trial can be done remotely, if necessary. Since the telegraph, many improvements in communications have broken barriers and enabled transactions in the absence of parties being present together, verses the archaic times when one or other of the parties would have to sail an ocean to do a deal in-person ! So, it is no surprise that mere convenience should be given as much weight as in the past, is my radical thought for the day !

            1. 3.1.1.1.1.1

              Congress specified in the statute the factors that are to be considered. Congress is free to change them anytime. The telephone and the video-feed have been around for many years now, and yet Congress has not seen fit to amend the list of statutory factors. Anyone may write their congressional representatives if they believe a change is in order.

          2. 3.1.1.1.2

            My friend LR, let’s not be so wooden.

            Sure, the literal word is there. But one way of understanding the word is to remember that is applies to the asset (witness) of the party.

            Want to see this view? Check out the Cornell write-up of that law, specifically the notes tab.

            See: link to law.cornell.edu

            In that notes tab, there is a particular Supreme Court case that discusses a wrinkle worth noting. Now mind you, the particular case was actually a “push” in that the Court split evenly, and thus the decision below held.

            See: link to law.cornell.edu

            BALTIMORE & O.R. CO. v. KEPNER. 314 U.S. 44, Nov. 10, 1941

            What you see in action is a “David v. Goliath” aspect, and the assets of Goliath are NOT treated on the same equitable footing as the David.

    2. 3.2

      The plaintiff is not a Texas company. It is a publicly traded, New York based, corporate mega troll that created a Texas baby troll sub to create the fake appearance of a local presence.

      1. 3.2.1

        oh, I wasn’t aware of that. At some point one would think it could amount to a sham but the way things are set up that’ll never happen.

        It would be nifty to see a judge say “No venue transfer, we’re doing this trial completely by remote videoconferencing, excepting what a movant shows compelling necessity for the parties actual presence.”

        idk, I just sense that some modification of how “convenience” is interpreted for venue change purposes, needs to evolve more than it has.
        And possibly, if videoconf’s could be implemented more, it “might could*” take some of the winds out of the sail of forum shopping. ?

        * might could = East Tex. slang for “maybe”

  3. 1

    At some point the inconvenience of being a woman or a brown person in Texas will also be a major consideration.

    1. 1.1

      Here’s the incredibly silly claim 1 of the ‘610 patent. FYI, these trolls are sueing all kinds of vastly different big companies who happen to use search engines.

      1. A method of processing data of a data set over a distributed system, wherein the data set comprises a plurality of data groups, the method comprising:
      partitioning the data of each one of the data groups into a plurality of data partitions that each have a plurality of key-value pairs and providing each data partition to a selected one of a plurality of mapping functions that are each user-configurable to independently output a plurality of lists of values for each of a set of keys found in such map function’s corresponding data partition to form corresponding intermediate data for that data group and identifiable to that data group, wherein the data of a first data group has a different schema than the data of a second data group and the data of the first data group is mapped differently than the data of the second data group so that different lists of values are output for the corresponding different intermediate data, wherein the different schema and corresponding different intermediate data have a key in common; and
      reducing the intermediate data for the data groups to at least one output data group, including processing the intermediate data for each data group in a manner that is defined to correspond to that data group, so as to result in a merging of the corresponding different intermediate data based on the key in common,
      wherein the mapping and reducing operations are performed by a distributed system.

      1. 1.1.1

        MM bro, did you see your fav (and my second fav) lefty girl getting hard reamed by lefties against nuclear war for her funding the ukraine nonsense, and then her TONE POLICING the audience? Can you believe her tone policing them bro? I like her better when she’s bringin the ruckus if ya kna mean.

        link to youtube.com

        1. 1.1.1.1

          Wow, would be nice — but will not happen — to get Malcolm’s response to the hypocrisy of this particular Liberal Left politician.

      1. 1.2.1

        Tone deaf, you say?

        Well, the good news for Malcolm is that as of this past Monday, hearing aids are now available OTC.

        (not that such will cure what ails him, of course)

    2. 1.3

      Brown women tend not to be pre-abortion without limits. Check out Mayra Flores. From Texas. First Mexican-born woman sworn in to Congress.

    3. 1.4

      Where is that “Bob” guy who gets so upset at non-patent law posts….?

      Malcolm goes off the rails and no call to Crouch. Funny that, the ONLY time that call goes out is a when a non-patent law post is against the Left…

        1. 1.4.1.1

          That’s largely because while liberals love pontificating what others SHOULD be doin’ . . . conservatives are those who actually ARE doin’.

          Talkin’ is easier than doin’.

          So much easier.

          1. 1.4.1.1.1

            Wolfgang Pauli famously said of another physicist’s work that it was “not even wrong,” because the thesis was so vague that it could not be either verified or falsified. The thesis that “liberals love pontificating what others SHOULD be doin’ . . . conservatives are those who actually ARE doin’” is equally susceptible to Pauli’s critique. What does this even mean? How could one possibly verify this assertion?

            1. 1.4.1.1.1.1

              Wow – that hit the George Carlin filter….?

              My post of October 22, 2022 at 11:47 am on hold…

              ^^^ utter b0ll 0cks [modified to pass filter]

              This falls to Greg’s propensity to Demand a level of discourse that he himself would not provide.

              1. 1.4.1.1.1.2.1

                PM,

                I do not think that Greg was replying to your comment (which IS factual and proveable/disproveable AND accurate).

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