Two Mandamus Petitions: Transfer Granted, Improper Service Denied

by Dennis Crouch

A Federal Circuit panel recently released a pair of mandamus orders dealing with important civil procedure issues – one granting a petition to transfer venue under 28 USC 1404(a) , the other denying a petition challenging substitute service of process for a foreign defendant.

In the first case, In re Honeywell Int’l Inc., Honeywell was sued for patent infringement in the Western District of Texas. Lone Star SCM Systems, Ltd. v. Honeywell International Inc., Docket No. 6:21-cv-00843 (W.D. Tex., Filed Aug 12, 2021). Honeywell moved to transfer the case to the Western District of North Carolina under 28 U.S.C. § 1404(a), arguing that the bulk of the evidence and witnesses were located there — making that location much more convenient. The district court analyzed the private and public interest factors but denied transfer, mainly based on the plaintiff’s choice of forum and judicial economy.  In particular, Judge Albright has two other cases filed by the same plaintiff pending for several years in his courtroom and he has developed substantial understanding of the patents at issue.

Honeywell petitioned the Federal Circuit for a writ of mandamus directing the district court to transfer the case. The appellate panel of Judges Dyk, Bryson, and Taranto concluded that keeping the case in the Western District of Texas amounted to a “clear abuse of discretion leading to a patently erroneous result.” Several factors favored transfer, while nothing significant tied the case to Texas. The court held that the “incremental gains” in judicial economy were insufficient to justify the inconvenience of litigating in an improper venue.  The district court opinion is entirely under seal, and so we cannot know exactly how Judge Albright justified his decision not to transfer.

In contrast, in In re Aputure Imaging Industries Co., Ltd., the district court granted the plaintiff’s motion to serve the Chinese defendant Aputure by emailing the summons and complaint to Aputure’s attorney. Aputure petitioned for mandamus, arguing that the Hague Convention required the plaintiff to first attempt service in China.

The Federal Circuit denied Aputure’s petition. First, Aputure failed to show a post-judgment appeal would be inadequate. Second, Aputure did not establish a clear and undisputable right to relief.  Mandamus is seen as an extraordinary relief, and both of these must be shown in order for an appellate court to take action.  Ultimately, the appellate panel concluded that district court exercised reasonable discretion in permitting alternative service without requiring strict compliance with the Hague Convention.

The Federal Circuit recognized the district court’s broad discretion to authorize alternative means of serving foreign defendants under FRCP Rule 4(f)(3), which permits service by “other court-ordered means not prohibited by international agreement.”

If you had a stickler professor for civil procedure, you learned that service of process in the US is a really complicated mess of Constitutional principles, Federal Rules, State Laws, and common practices. FRCP Rule 4(f) sets out rules for serving “an Individual in a Foreign Country.”  It would thus not directly apply to serving the company (Aputure) defendant in this case. R.4(h) provides the additional guidance that a company can be served “at a place not within any judicial district of the United States, in any manner prescribed by Rule 4(f) for serving an individual, except personal delivery under (f)(2)(C)(i).” So, while personal hand delivery abroad is an option for serving an individual under 4(f), that specific provision does not extend to foreign companies. But the other subsections of Rule 4(f) detailing options for foreign service by court order, internationally agreed means, etc. can be utilized for companies.

Here, the patentee Rotolight made multiple attempts to serve Aputure at addresses linked to Aputure’s own website and business listings. When those efforts failed, Rotolight sought court approval to email the complaint and summons to Aputure’s US attorney. The district court reasonably found this would effectively provide notice and an opportunity for Aputure to respond. Given Rotolight’s documented service attempts and the court’s finding that email service would be effective, the Federal Circuit concluded it was not prepared to say allowing substitute service was a clear abuse of discretion warranting the extraordinary remedy of mandamus relief. The order permitting alternative service was within the district court’s broad latitude under Rule 4. Since service is proper, the infringement action will continue to move forward in the Eastern District of Texas.