Intellectual Ventures sues Volvo over patents on day of infringement notice, points Western District of Texas to overlap with General Motors litigation

In yesterday's post on Sisvel's 5G license deal with Microsoft I noted that the European Commission's Directorate-General for the Internal Market (DG GROW) may be underrating the contribution that patent pools make to the standard-essential patent (SEP) licensing process. The situation in the automotive industry also serves as an example: while Avanci has licensed the vast majority of automotive brands in the world (up to 4G, with a 5G licensing program in the works), a couple of owners of smaller cellular SEP portfolios who are not Avanci licensors keep litigating against Avanci licensees.

Less than two weeks ago I reported on GenghisComm's lawsuit against Toyota. Now I found out about the next non-Avanci patent assertion against an automaker: Intellectual Ventures v. Toyota.

In the fall of 2021, IV predicted an "IP reckoning" for the automotive industry and then filed infringement complaints against several car makers. Some of those patent assertions were transferred out of Texas, particularly to Detroit, the geographic center of the traditional (non-Tesla) U.S. auto industry.

Here's the new complaint against Volvo, which interestingly was filed on the same day (yesterday) on which IV gave a formal patent-specific infringement notice to the Swedish car maker:

Intellectual Ventures I LLC and Intellectual Ventures II LLC v. Volvo Car Corporation et al. (W.D. Tex., case no. 6:23-cv-00429): patent infringement complaint

These are the patents-in-suit:

1. U.S. Patent No. 6,832,283 on a "method for addressing network components"; originally filed by Daimler; previously asserted against GM, Honda, Toyota

2. U.S. Patent No. 7,891,004 on a "method for vehicle internetworks"; same family as '008 patent; previously asserted against GM and Honda

3. U.S. Patent No. 9,232,158 on "large dynamic range cameras"; previously asserted against GM, Honda, Toyota

4. U.S. Patent No. 10,292,138 on "determining buffer occupancy and selecting data for transmission on a radio bearer"; from a patent family originally obtained by IPWireless, a company that General Dynamics acquired in 2012; previously asserted against GM, Toyota, Honda

5. U.S. Patent No. 8,953,641 on "methods and apparatus for multi-carrier communications with variable channel bandwidth"; previously asserted against GM, Honda, Toyota

6. U.S. Patent No. 7,684,318 on "shared-communications channel utilization for applications having different class of service requirements"; previously asserted against GM, Honda, Toyota

7. U.S. Patent No. 9,602,608 on a "system and method for notifying a user of people, places or things having attributes matching a user's stated preference"; previously asserted against GM, Toyota, Honda

8. U.S. Patent No. 7,484,008 on a "apparatus for vehicle internetworks"; same family as '004 patent; previously asserted against Toyota

So, Volvo is not the first automaker to be sued over any of those patents. IV points out the overlap with the GM case pending in the same district:

Intellectual Ventures I LLC and Intellectual Ventures II LLC v. Volvo Car Corporation et al. (W.D. Tex., case no. 6:23-cv-00429): notice of related case

Let me make a statement on an unrelated case: yesterday's post on the Optis v. Apple FRAND determination by Mr Justice Marcus Smith (High Court of Justice, England and Wales) has been my most popular patent-related blog post in recent months. Some non-patent antitrust-related posts drew a lot more traffic, but that's not a "comparable" topic. Also, ManagingIP credited me for having broken the news on the outcome of that case, which I appreciate.

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Chief Judge of Western District of Texas does Chief Justice Roberts's bidding: patentees now have less than 10% chance of given case being assigned to Judge Albright

Judge Alan Albright managed to attract roughly a quarter of all U.S. patent infringement complaints to the Waco division of the United States District Court for the Western District of Texas. Without a doubt, plaintiffs went there for the combination of the following two factors:

• Many large technology companies have operations in that district that weigh against a transfer to another venue under TC Heartland.

• By filing a case with the Waco division, plaintiffs knew for certain that a case was going to be assigned Judge Albright, a former patent litigator--even though he sometimes held trials in nearby Austin.

"Judge-shopping" is what its critics called it. Its days were numbered when the Judicial Conference under Chief Justice John Roberts called for change. Yesterday, Chief U.S. District Judge Orlando Garcia entered a standing order that says this:

Upon consideration of the volume of new patent cases assigned to the Waco Division and in an effort to equitably distribute those cases, it is hereby ORDERED that, in accordance with 28 U.S.C. § 137, all civil cases involving patents [...], filed in the Waco Division on or after July 25, 2022, shall be randomly assigned to the following district judges of this Court until further order of the Court.

There are 12 judges on the list: the Chief District Judge himself, Judge Albright, and ten other judges.

The first question I asked myself when I saw that orders is: why only Waco? Wouldn't it be more principled to say that all patent cases filed in that district would be randomly assigned?

The problem of a disproportionate number of cases being assigned to a single judge was specific to only the Waco division. But if the cases filed in Waco are randomly distributed, and assuming that the number of cases filed with the other divisions combined is going to be small, yet greater than zero, it actually means that Judge Albright will get fewer patent cases assigned to him than his colleagues. That is discriminatory.

With a pool of twelve judges, it's practically impossible that patent holders will be equally pleased with the results they are going to achieve in that district as they have been in recent years. Maybe a couple of judges will have a similar mindset as Judge Albright, and will preside over patent cases with comparable verve, but not all eleven of them.

Wouldn't it have been sufficient to identify a pool of, say, three or four judges with a strong interest in patent law? In that case, there would be a greater degree of predictability.

It is a key characteristic of the U.S. judiciary that all federal district judges are generalists. They may hear a criminal case one day and a patent case the next day. There are "hotspots" where each judge gets at least a few patent cases assigned per year, and Judge Rodney Gilstrap of the United States District Court of the Eastern District probably has a docket that overwhelmingly consists of patent cases. (And he's the Chief Judge there.)

The U.S. judiciary is an outlier on the global stage, where the other major jurisdictions do have specialized court divisions that focus on patent law. In Dusseldorf and Munich, there are three patent-specialized divisions each, and two in Mannheim. In Barcelona, there are three trade judges who hear patent cases. There are patent-specialized judges in the UK, the Netherlands, France, China, Japan, and some other places. At the European level, the Unified Patent Court (UPC) will go into operation next year.

Patent law is a complex field, it has some unique characteristics, and it helps when judges acquire a feel for technical issues. Those are only some of the strong arguments in favor of specialization. The USITC is a great example.

Some cases that would have been filed in the Western District of Texas before yesterday are now going to be brought in other U.S. districts, such as the Eastern District of Texas or the Eastern District of Virginia ("rocket docket"). But some patent holders may conclude that the best strategy is to seek injunctions in Europe (of course, provided that they hold European patents).

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Ericsson's first U.S. patent trial against Apple to be held in first half of November: ITC evidentiary hearings in other Ericsson v. Apple cases slated for January and February

'Tis the scheduling season for the Ericsson v. Apple 5G patent dispute. Judge Rodney Gilstrap of the United States District Court for the Eastern District of Texas scheduled an Ericsson v. Apple FRAND trial for June 2023, and an Apple v. Ericsson trial for the following month. The Munich I Regional Court will conduct a first hearing in an Ericsson v. Apple case on September 14, 2022, while the Mannheim Regional Court will hold an Apple v. Ericsson trial on October 18, 2022. The Administrative Law Judges (ALJs) in charge of the investigations of Ericsson's three complaints with the United States International Trade Commission ("USITC" or just "ITC") have meanwhile also set some key target dates for their cases, which are theoretically subject to Commission review and practically may get delayed further down the road due to the U.S. trade agency's workload.

The ITC is also investigating Apple's countersuit (over mmWave patents), but should any scheduling decision have been made in that case, it hasn't been published on the agency's electronic docket yet (or isn't publicly accessible yet). I will report on the schedule of that investigation as soon as I find out.

By coincidence, the last-filed one of Ericsson's three near-simultaneous complaints got the fastest schedule. Here's a table that shows you the key dates in those three Ericsson v. Apple cases as currently contemplated by the ALJs:

	337-TA-1299	337-TA-1300	337-TA-1301
ALJ	Shaw	McNamara	Elliot
Markman hearing	TBD	07/11/22 or 07/13/22	05/24/22 - 05/25/22
Trial	02/01/23 - 02/06/23	01/05/23 - 01/12/23	11/04/22 - 11/10/22
ALJ ruling	05/24/23	04/24/23	02/24/23
Commission ruling	09/25/23	08/24/23	06/26/23

The Office of Unfair Import Investigations ("OUII" or "ITC staff") will be a neutral participant in all Ericsson-Apple investigations (including Apple's countersuit), but in three of the four cases--all but Ericsson's first-filed case involving standard-essential patents (SEPs)--its participation will be limited to questions concerning remedies without addressing the technical merits.

On this occasion, let me provide, just for convenience, an overview of Ericsson's U.S. patents-in-suit by case.

337-TA-1299 (4G/5G SEP case; ALJ David P. Shaw)

In the Matter of Certain Mobile Telephones, Tablet Computers With Cellular Connectivity, and Smart Watches With Cellular Connectivity, Components Thereof, and Products Containing Same

(Complaint No. 337-3595)

Federal companion lawsuit: Western District of Texas, case no. 22-cv-00060

1. U.S. Patent No. 8,102,805 on "HARQ [Hybrid Automatic Repeat reQuest] in spatial mutiplexing MIMO [multiple-input multiple-output] system"

2. U.S. Patent No. 9,532,355 on "transmission of system information on a downlink shared channel"

3. U.S. Patent No. 10,425,817 on a "subscription concealed identifier"

4. U.S. Patent No. 11,139,872 on "codebook subset restriction signaling"

337-TA-1300 (first non-SEP case; ALJ MaryJoan McNamara)

In the Matter of Certain Mobile Phones, Tablet Computers, Smart Watches, Smart Speakers, and Digital Media Players, and Products Containing Same

(Complaint No. 337-3596)

Federal companion lawsuit: Western District of Texas, case no. 22-cv-00061 (also includes patents from -1301 investigation)

1. U.S. Patent No. 7,151,430 on a "method of and inductor layout for reduced VCO [voltage-controlled oscillator] coupling": Ericsson positions this one as "the one patent to ban them all" as it's the only patent allegedly infringed by "at least Apple iPhone mobile phones, Apple iPad tablet computers, Apple Watch smart watches, Apple HomePod smart speakers, and Apple TV digital media players, and products containing same." By contrast, the other patents asserted by the same ITC complaint are described as being infringed by iPhones (though Ericsson reserves the right to amend its infringement contentions).

   The '430 patent is sort of Ericsson's favorite patent-in-suit. It was asserted in 2015 against Apple (in federal court), and last year in an ITC complaint against Samsung. Those disputes settled before any infringement or (in)validity determination was made, but it looks like Ericsson was underwhelmed by both Apple's and Samsung's arguments relating to this patent.

   Furthermore, Ericsson asserted some European members of the same patent family (EP1721324 and EP2819131) against Samsung in Germany and Belgium, and against Wiko in Germany. Samsung and Wiko challenged those patents in the Federal Patent Court of Germany, so Ericsson knows pretty well what kinds of invalidity contentions it has to expect (unless, of course, Apple comes up with different prior art).

2. U.S. Patent No. 7,957,770 on a "mobile communication terminal for providing tactile interface"

3. U.S. Patent No. 9,509,273 on "transformer filter arrangement"

4. U.S. Patent No. 9,705,400 on "reconfigurable output stage"

5. U.S. Patent No. 9,853,621 on "transformer filter arrangement" (yes, same title as the '273 patent)

337-TA-1301 (second non-SEP case); ALJ Cameron Elliot

In the Matter of Certain Mobile Phones and Tablet Computers, All With Switchable Connectivity

(Complaint No. 337-3597)

Federal companion lawsuit: Western District of Texas, case no. 22-cv-00061 (also includes patents from -1300 investigation)

1. U.S. Patent No. 8,792,454 on "secure and seamless WAN-LAN [wide area network, local area network] roaming"

2. U.S. Patent No. 10,880,794 on "inter-band handover of the same physical frequency"

3. U.S. Patent No. 8,472,999 on a "method and system for enabling dual standby state in a wireless communication system"

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Ericsson accuses Apple of having wasted court and party resources in Eastern District of Texas 'by forcing unnecessary litigation on two fronts'

Before the U.S. part of the litigation between Ericsson and Apple can begin in earnest, some procedural questions need to be sorted out. If we want to liken this to a chess match, we can say that the opening is coming to an end:

• The simplest part is a formality that Judge Alan Albright in the Western District of Texas signed off on: the two Ericsson v. Apple cases pending there have been stayed pending the resolution of the related ITC complaints (one of the two W.D. Tex. complaints relates to two separate ITC complaints). This is standard routine, and Ericsson didn't oppose the stay as it would have been futile.

• Apple does not appear to consider it a priority to seek damages over its three ITC patents-in-suit in district court. Any such complaint would have been stayed at Ericsson's request anyway. The unit volumes of the accused products are so asymmetrical that Apple would have to demand an absurd per-unit royalty to claim any noteworthy amount of damages, which could then be held against it when trying to bring down Ericsson's potential future damages claims. Also, Apple would have to make a venue choice, which would either be disadvantageous for Apple's offensive or defensive purposes and/or expose the inconsistency of its position on forum conveniens, which is already a problem because Apple pretends to favor the Eastern District of Texas until it really has to make a commitment to that venue. So for Apple it makes sense to just wait before bringing (if ever) a companion lawsuit in federal court.

• It's a safe assumption that the ITC will soon institute all four investigations requested. Apple is fine with the public-interest questions related to its countercomplaint against Ericsson being delegated to the Administrative Law Judge (ALJ) who will be put in charge. With respect to FRAND-related public-interest considerations, Ericsson got support from former U.S. standards czar Walter Copan (PDF on Scribd) and four U.S. law professors (PDF on Scribd). Both these submissions were replies, and the filers had not previously commented on the public interest in that case. The ITC rejected those submissions for the time being, for timing not substance, but noted that after a final initial determination by the ALJ, there will (unless no violation is found) be another opportunity to make such submissions. While neither the ALJ nor the Commission (the U.S. trade agency's top-level decision-making body) can formally cite to rejected submissions, Ericsson may benefit from them psychologically at any rate.

  While I don't blame the ITC for generously allowing ACT | The App(le) Association to correct a font size and refile slightly out of time (only a clerical error--unprofessional but not a big deal), I remain concerned about the failure of those "Apploturfers" to make it clear that Apple pays them while there is no evidence or indication of any of those 5,000 purportedly small app developers and (alternatingly) IoT device makers ever having paid a cent.

  The opening of the ITC proceedings goes slightly beyond the formal institution of an investigation. It's possible that Apple will seek the consolidation of two or three Ericsson cases into one investigation, and the ALJ(s) will have to rule on such a procedural request early on.

• We will soon know the framework for the adjudication of the parties' dueling FRAND claims in the Eastern District of Texas and Apple's three declaratory-judgment claims taking aim at Ericsson 5G SEPs. Let me point you to my most recent analysis of the procedural maneuvering in the Eastern District (which also involves the question of appellate jurisdiction) and provide an update below.

At an abstract level, Apple needs to overcome each of several hurdles to impose its preferred procedural framework, while Ericsson has more than one path to its desired outcome or at least a result that would be pretty close to it. One of those opportunities for Ericsson to simplify everything and thwart Apple's procedural strategy is its motion to amend its October 2021 FRAND complaint by adding--on top of the original DJ claim that the court should bless Ericsson's FRAND compliance--claims of Apple having breached its FRAND obligation. On Wednesday, Ericsson filed a reply in support of its motion to amend its complaint, and uploaded a redacted version on Thursday (this post continues below the document):

22-02-10 Ericsson Riso Moti... by Florian Mueller

There's a table near the bottom of page 2 of that Ericsson filing that shows how Apple tried to mislead Judge Rodney Gilstrap as to the case law. I will now also juxtapose how Apple quoted a precedent (left column) and what the original decision actually said:

Apple's quotation	Actual holding (omissions emphasized)
"[W]here a plaintiff never had standing to assert a claim against the defendants, it does not have standing to amend the complaint and control the litigation"	"Rather, we hold only that where a plaintiff never had standing to assert a claim against the defendants, it does not have standing to amend the complaint and control the litigation by substituting new plaintiffs, a new class, and a new cause of action."

Why are those omissions so deceitful? Because the out-of-context quote on the left side makes it sound like Ericsson couldn't amend its complaint if the original version of the complaint has to be dismissed because Apple alleges Ericsson was barred from bringing such claims at the time by a clause in the meanwhile-expired cross-license agreement. Even if Apple was right about the effect of that contract, that would not be a jurisdictional question according to Ericsson--and Apple itself brought claims in December that almost certainly weren't allowed under that license agreement unless Ericsson's October complaint was also permissible.

The right side of that table, however, shows that Apple's purported "authority" is inapposite because Ericsson, unlike the plaintiff in that precedent, didn't substitute a new plaintiff--and bringing in a new plaintiff when the court didn't have jurisdiction over the original one is where courts in the Fifth Circuit have consistently rejected amendments to fatally-deficient complaints.

Coming from the assumption that its own FRAND case, at least in the amended form, can go forward, Ericsson reiterates in a reply brief that Apple's FRAND claims would have to be brought as counterclaims to Ericsson's case (this post continues below the document):

22-02-10 Ericsson Riso Mtd ... by Florian Mueller

Ericsson blames Apple for wasting everyone's time and money:

"Apple’s decision to file its FRAND claims in this suit, rather than in the First-Filed Action, wasted the Court’s and the parties’ resources by forcing unnecessary litigation on two fronts. That is why courts often short-circuit the process and dismiss or transfer a second-filed action while a motion to dismiss the first suit is still pending."

In a footnote, Ericsson suggests that the Texas court could even have thrown out Apple's later-filed FRAND case at its own initiative (sua sponte):

"To avoid wasting judicial resources on second-filed actions like Apple’s, courts dismiss or transfer later-filed cases even in the absence of any motion by the parties. See Meganathan v. Signal Int’l L.L.C., No. 1:13-CV-497, 2015 WL 13906343, at *2 (E.D. Tex. June 17, 2015) ('The application or propriety of transfer under the first-to-file rule may be raised sua sponte.')."

There are some redacted passages in that document. I'm unable to deduce from the publicly accessible parts what the redacted parts might say, but they appear to be related to the exact language of the 2015 cross-license agreement and possibly also some kind of licensing offer made by Apple a few months ago involving its own SEPs.

Ericsson also reinforces its proposal that Apple's DJ actions against three Ericsson 5G SEPs be kept separate from the FRAND issues to avoid "unnecessary complexity in what would otherwise be a FRAND case." Ericsson argues that the FRAND case won't benefit from a determination regarding the essentiality of three patents out of 300 with respect to which Ericsson provided claim charts to Apple during their failed negotiations.

The logical next step is now for Judge Gilstrap to rule on the parties' motions. There may stil be two cases in the end, but Apple's case might be reduced to just the three patent-specific DJ claims, and Ericsson's case would then be the sole FRAND case.

As for Apple attacking Ericsson patents, I have an update. Last month I noted that Apple was piggybacking on Samsung's 2021 campaign to get some Ericsson patents invalidated, regardless of whether Ericsson is actually asserting them against Apple at the moment. I first discovered seven such petitions, and then found another three. This month, Apple has added another nine petitions. I'll wait a bit because it seems Apple continues to make filings, and will provide an updated and complete list on another occasion. At first sight, Apple is still just recycling Samsung's 2021 petitions.

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Apple: Eastern District of Texas preferred over Western -- Ericsson: with pleasure IF you make a binding commitment to it -- Apple (deafening silence)

Apple has a serious problem with Ericsson having made all the right venue-related decisions so far: the ITC for potential U.S. import bans; the Eastern District of Texas for FRAND issues (where Ericsson won a landmark case against HTC); and the Western District of Texas for damages (companion complaints to import ban requests). Ericsson is also enforcing its rights in four other countries, with preliminary injunction requests pending in Brazil and the Netherlands. In Germany, Ericsson hedged its bets by filing cases with the three leading regional courts for patent cases. Munich and Mannheim are safe choices for plaintiffs, and Ericsson was so lucky as to have both of its cases assigned to Judge Dr. Daniel Voss ("Voß" in German), who is widely regarded as the plaintiff-friendliest of the three judges presiding over patent-specialized divisions (called "civil chambers") of the Dusseldorf Regional Court. Judge Dr. Voss is basically Dusseldorf's answer to the Munich and Mannheim judges.

Now Apple is jockeying for a better position. Part of that effort is a PTAB IPR campaign piggybacking on Samsung's 2021 challenges to many Ericsson patents, taking aim at patents Ericsson hasn't even asserted against Apple. And very surprisingly, almost shockingly, Apple proposed to have the whole dispute resolved by means of a rate-setting decision in the Eastern District of Texas, a venue Apple dreads so much that it even closed its stores there (Apple Stonebriar in Fisco, TX, and Apple Willow Bend in Plano, TX) after the Supreme Court's TC Heartland decision that made it a lot easier to get patent infringement cases moved out of a district unless the defendant has a permanent business presence there (as opposed to merely selling products or offering services nationwide).

Oh well, it now looks like Apple still doesn't really love the Eastern District of Texas...

A week ago, Apple filed a request for an early case management conference in the Eastern District and accused Ericsson of trying to undermine that court's jurisdictions through cases filed elsewhere (including overseas enforcement actions). The next day, Ericsson's counsel contacted Apple's counsel (PDF on Scribd), describing that "characterization [as] both misleading and ironic" as Ericsson "would have preferred to file its patent cases in the Eastern District of Texas, but [Ericsson's] filing in the Western District was necessitated by Apple’s highly publicized closing of all its retail stores in the Eastern District." And then Ericsson made Apple the following proposal:

"Nonetheless, Ericsson is willing to dismiss its Western District suits and refile in the Eastern District if Apple is willing to stipulate to venue in the Eastern District for this dispute and waive any objection under TC Heartland."

In other words: Ericsson is fine with either the Eastern (preferred) or Western District of Texas, but will move its case form the Western to the Eastern District provided that Apple promises not to request a venue transfer to the Northern District of California.

Apple can always bring such a request in the Western District of Texas as well, but it has a strong presence there with many thousands of employees, making a denial of a transfer motion pretty much a given.

The only thing Ericsson didn't want to do was to give Apple an opportunity to avoid Texas altogether.

Apple declined. While there's plenty of rhetoric in a reply (PDF on Scribd) Apple's counsel sent four days later, Apple simply isn't willing to make a binding commitment to the Eastern District of Texas. All that Apple really appears to love about the Eastern District is that it's a gateway to California because of TC Heartland.

On Monday, Ericsson filed its opposition to Apple's request for an early case management and, on that occasion, demonstrated to Chief Judge Gilstrap in the Eastern District of Texas that Apple doesn't truly want to litigate there if it can avoid it. Here's Ericsson's opposition filing, to which the documents I previously linked to serve as exhibits (this post continues below the document):

22-01-24 Ericsson Oppositio... by Florian Mueller

Ericsson's position on an early case management conference is that Apple should firstly specify the issues to be addressed and try to resolve them with Ericsson through meet-and-confer. Only if any issues remained, they could be raised with the court, and the court may not even consider a hearing necessary to resolve any motions resulting from procedural disagreements.

That Ericsson filing also mentions Apple's PTAB IPR campaign (the first five filings, and I've discovered two more that came after Ericsson's opposition brief).

For Judge Gilstrap it's now easy to see what Apple really wants: it wants no enforcement action to take place (which is unrealistic since a FRAND determination is only appropriate for SEPs, but Ericsson is also entitled to royalties on its non-SEPs), and at least not in the Eastern or Western District of Texas. When Ericsson's FRAND action in the Eastern District became known a few months ago, I already wrote that "[i]f Apple wants to go west, it will want to go much further west, i.e., to the Northern District of California, its home district." (emphasis in original)

In addition to the Eastern-Western-Northern thing, Apple and Ericsson also disagree sharply on how to treat the two competing FRAND actions in the Eastern District of Texas. In December, Apple moved to dismiss Ericsson's FRAND case and instead brought its own, which besides four FRAND claims also contains three declaratory-judgment claims against the following Ericsson 5G standard-essential patents (at a time when Ericsson wasn't even suing Apple over patents as a license agreement was still in force for about another month):

Declaratory Judgment Patents

1. U.S. Patent No. 10,374,768 on "efficient SRS resource indication methods"

2. U.S. Patent No. 10,644,724 on "shift values for quasi-cyclic LDPC codes

3. U.S. Patent No. 11,039,312 on "handling of multiple authentication procedures in 5G"

Last week, Ericsson filed its opposition to Apple's motion to dismiss Ericsson's FRAND case (this post continues below the document):

22-01-19 Ericsson Oppositio... by Florian Mueller

Ericsson points to the fact that Apple's FRAND claims pretty much mirror Ericsson's, so Apple itself doesn't really seem to believe that those types of claims weren't justiciable. Also, Ericsson says the license agreement that was in force at the time of filing the complaint did not preclude Ericsson from bringing a FRAND action regarding a future license agreement.

Apple has already replied in support of its motion to dismiss, but that filing is sealed for now. (It also took me a while to find some of last week's filings, probably for the same reason.)

Not only does Ericsson defend its own FRAND case against Apple's motion to dismiss, but it is requesting the dismissal of Apple's FRAND claims or, in the alternative, the consolidation of those claims into Ericsson's case (this post continues below the document):

22-01-19 Ericsson Motion to... by Florian Mueller

Note that this motion to dismiss relates to Apple's FRAND claims, not to the three patent-specific declaratory-judgment claims listed above.

Ericsson argues that Apple's FRAND claims should have been brought as counterclaims to Ericsson's FRAND claims, i.e., they were compulsory counterclaims. The worst-case scenario for Apple would be that its decision to bring a separate complaint--instead of counterclaiming in a pending one, regardless of whether Apple moved to dismiss it--waived those claims. But Ericsson doesn't rely on that theory alone. As a fallback (and that may be the more realistic outcome), Ericsson proposed to sever those FRAND claims from the patent-specific declaratory-judgment claims and to consolidate them into Ericsson's earlier filed Texas FRAND case.

Given that the parties will ultimately have to work out the terms of a cross-license, it wouldn't make sense to have two parallel complaints. And they seem to agree on that, too: it's just that the most extreme position either party can take is that its own complaint should survive while the other should fall. But my guess is we'll see a single FRAND case in the Eastern District of Texas that will involve both parties' FRAND claims.

For the near term I expect to find out about more infringement countersuits by Apple such as the one in Mannheim, but the most interesting question will be whether Ericsson can land a "lucky punch" with its preliminary-injunction requests in Brazil and the Netherlands.

Yesterday, an Ericsson financial report gave an indication as to how much (or how little, if you will) Apple paid Ericsson under the expired license agreement.

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Ericsson sues Apple over infringement of 5G and other patents upon expiration of license agreement--Apple now facing an 'Epicsson' dilemma

Ericsson's patent cross-license agreement with Apple has expired, and no renewal has been agreed upon, which is why infringement litigation became inevitable. IAM was first to spot two filings by Ericsson against Apple in the Western District of Texas over four patents in one case and eight in the other. Apple will predictably retaliate, but Apple's exposure to patent assertions dwarfs Ericsson's. When there was no announcement of a renewed license agreement or renewed litigation after the turn of the year, I thought the middle of the month was going to be when we would hear more. Let me show you the complaints first--this post continues below the two documents:

22-01-17 (WDTX22cv60) Erics... by Florian Mueller

Patents-in-suit in the 22-cv-60 action:

1. U.S. Patent No. 8,102,805 on "HARQ [Hybrid Automatic Repeat reQuest] in spatial mutiplexing MIMO [multiple-input multiple-output] system"

2. U.S. Patent No. 9,532,355 on "transmission of system information on a downlink shared channel"

3. U.S. Patent No. 10,425,817 on a "subscription concealed identifier"

4. U.S. Patent No. 11,139,872 on "codebook subset restriction signaling"

22-01-17 (WDTX22cv61) Erics... by Florian Mueller

Patents-in-suit in the 22-cv-61 action:

1. U.S. Patent No. 7,151,430 on a "method of and inductor layout for reduced VCO [voltage-controlled oscillator] coupling"

2. U.S. Patent No. 7,957,770 on a "mobile communication terminal for providing tactile interface"

3. U.S. Patent No. 8,472,999 on a "method and system for enabling dual standby state in a wireless communication system"

4. U.S. Patent No. 8,792,454 on "secure and seamless WAN-LAN [wide area network, local area network] roaming"

5. U.S. Patent No. 9,509,273 on "transformer filter arrangement"

6. U.S. Patent No. 9,705,400 on "reconfigurable output stage"

7. U.S. Patent No. 9,853,621 on "transformer filter arrangement" (yes, same title as the '273 patent)

8. U.S. Patent No. 10,880,794 on "inter-band handover of the same physical frequency"

Having seen Ericsson enforce patents against Apple and other parties in the past, I assume that one of the two complaints is a companion complaint to a Sec. 337 complaint with the United States International Trade Commission ("ITC"), seeking an exclusion order (aka import ban). Most likely the 22-cv-60 case (over four patents) is the companion complaint as the ITC urges complainants to focus on a small number of patents so it can keep its schedule (it is also possible to start an ITC case with many patents and to then narrow it by dropping most of the patents-in-suit, but I doubt that that is the plan here). I'm also pretty sure that Ericsson has near-simultaneously filed complaints with courts in other jurisdictions, among them almost certainly Germany, where Munich is the new number one and Mannheim continues to be a key venue.

Rarely ever has a patent dispute been less surprising than in this case:

• Three months ago, Ericsson brought a FRAND (not infringement) action in the Eastern District of Texas as Apple adamantly refused to accept its $5/unit licensing offer, an amount I don't consider unreasonable considering Apple's margins and Ericsson's portfolio. That "harbinger" action might have seemed early--months prior to the expiration of a multi-year cross-license agreement--but is understandable in light of Apple attacking some Ericsson patents before their last contract expired.

• Interestingly, Ericsson is now bringing its infringement actions in the Western District of Texas. Currently, the top echelon of the U.S. judiciary is working on new rules that would make it impossible to "judge-shop" by filing a patent case with the Waco division of the Western District of Texas, knowing for sure that Judge Albright will then preside over the case (unless a venue transfer motion succeeds, and he typically denies them). That reform will come too late for Apple in this case. Ericsson may have been attracted to the Western District by Apple's very strong presence there (they have created and continue to create lots of jobs in the area) and major wins for patent holders (most notably the §2.175 billion damages verdict that VLSI Technologies obtained in that district against Intel last year). Apple can try to get the FRAND case in the Eastern District consolidated with the infringement cases in the Western District--which leaves Apple between a rock and a hard place from a defendant's perspective.

• At around the same time as the filing in the Eastern District, Ericsson sought a Munich-style pre-emptive anti-antisuit injunction from a court in the Netherlands. While its petition was denied (also for a second time in a December 16 decision following a November 18 hearing), Ericsson now presuambly benefits from the fact that Apple declared it had no intention to pursue an antisuit injunction against Ericsson's infringement actions.

• More than two months later, the parties still hadn't agreed on a new deal: Apple moved to dismiss Ericsson's Texas FRAND action and instead brought its own countersuit.

There was a possibility until the last minute that they might still work it out. In order to bring infringement actions, Ericsson had to await the expiration of the last license agreement.

Recent developments in the case law in various major jurisdictions favor Ericsson's cause. Binding precedent matters--draft policy statements like one recently put forward by the Biden Administration have very little weight, if any.

Another significant 5G patent dispute broke out just before the turn of the year, with InterDigital suing OPPO in the UK, India, and Germany. And there are some interesting 4G cases targeting car makers: Sisvel v. Ford and Acer v. Volkswagen. Those patent holders--and several dozen others, among them Ericsson--won't sue Daimler over 4G patents, however, as the Mercedes maker took an Avanci pool license that also became known last month.

Last year, Ericsson filed infringement claims against Samsung on New Year's Day, and won a settlement in the spring.

Apple's license agreements with Nokia and InterDigital haven't been renewed in about five years, making it a possibility that we'll see a third wave of Nokia v. Apple cases later this year and/or a clash between InterDigital, which had a pretty successful 2021 on the licensing and litigation fronts, and the iPhone maker.

More recently, Apple has mostly been busy with App Store antitrust actions around the globe (private lawsuits as well as regulatory investigations, even in India where Apple's market share is tiny). This month, Epic Games will file its opening brief on appeal with the Ninth Circuit. It is striking that Apple argued in the Epic case that a relatively small number of unspecified patents entitled it to an allegedly reasonable 30% tax on in-app purchasing revenues while it is known that Apple's aggregate standard-essential patent royalty rate is closer to 1% of its sales. That contradiction creates an "Epicsson" dilemma for Apple's credibility.

[Update (Jan 19)] Meanwhile I've published and commented on Ericsson's ITC complaint over four SEPs as well as one over five non-SEPs. In the latter, I also provided a structured overview of all six pending U.S. cases between these parties. [/Update]

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Anti-judge-shopping initiative by Judicial Conference may spur internationalization of patent enforcement, further concentration of NPEs and litigation funders

There undeniably is a problem to be solved when one United States District Judge--Judge Alan Albright--gets about 20% of all U.S. patent infringement complaints. With the greatest respect for his admittedly tremendous expertise in patent litigation and his ability to work both smart and hard, it's mind-boggling when you consider that there are roundabout 700 U.S. district judgeships, and every district judge can hear patent cases (unlike in jurisdictions where patent complaints may be brought only before specialized divisions of particular courts).

Apart from his reluctance to transfer cases out of his district (and his division, unless he gets to preside over them anyway), and some other positions that patentees love him for, he may actually be much more balanced than people think. For example, he has recently invalidated patents on Alice abstraction (§ 101) grounds in a Facebook case and some other case. There was a fracking case last year in which I acknowledged he had a point. I listened in to a VLSI v. Intel trial, at the end of which Intel was cleared of infringement last summer, and saw no indication of pro-patentee bias. Let's put it this way: I keep watching developments in that district, but I try hard not to be intellectually dishonest when I voice criticism.

Now, it looks like his "market share" is going to go down soon. The annual report of the Judicial Conference under Chief Justice Roberts contains the following passage that is all about the W.D. of Tex.:

"The third agenda topic I would like to highlight is an arcane but important matter of judicial administration: judicial assignment and venue for patent cases in federal trial court. Senators from both sides of the aisle have expressed concern that case assignment procedures allowing the party filing a case to select a division of a district court might, in effect, enable the plaintiff to select a particular judge to hear a case. Two important and sometimes competing values are at issue. First, the Judicial Conference has long supported the random assignment of cases and fostered the role of district judges as generalists capable of handling the full range of legal issues. But the Conference is also mindful that Congress has intentionally shaped the lower courts into districts and divisions codified by law so that litigants are served by federal judges tied to their communities. Reconciling these values is important to public confidence in the courts, and I have asked the Director of the Administrative Office, who serves as Secretary of the Judicial Conference, to put the issue before the Conference. The Committee on Court Administration and Case Management is reviewing this matter and will report back to the full Conference. This issue of judicial administration provides another good example of a matter that self-governing bodies of judges from the front lines are in the best position to study and solve—and to work in partnership with Congress in the event change in the law is necessary.

"Chief Justice Taft was prescient in recognizing the need for the Judiciary to manage its internal affairs, both to promote informed administration and to ensure independence of the Branch. He understood that criticism of the courts is inevitable, and he lived through an era when federal courts faced strident calls for reform, some warranted and some not. [...]"

This Chief Justice is particularly institutional in his thinking. One can see that all the time, such as when he managed to avoid an overturning of the Illinois Bridge doctrine while still finding for the plaintiffs in the Pepper v. Apple dispute. Here, his desire--and he's obviously not speaking for himself alone--is to address the issue with the means at disposal of the judiciary, hoping to obviate the need for legislative intervention. It's about self-governance by the courts to the greatest extent possible.

The solution designed to curb Judge Albright's market share is to assign the patent cases brought in the W.D. of Tex. to different judges there, even though plaintiffs would obviously choose Judge Albright and file their complaints with the Waco division, which amounts to judge-shopping under the current framework.

Let's analyze this like any proposed solution to any identified problem must be looked at. Is it going to work in principle? Are there workarounds? And what about unintended consequences?

I would be shocked if the highest echelons of the federal judiciary of the United States couldn't make it work in principle. The proposal wouldn't have reached this milestone if they knew they couldn't make it happen--and in this case probably without requiring help from Congress.

But whether something works or "works-works" are two separate things. Would defendants necessarily be better off in other W.D. Tex. divisions? I know companies who would probably answer with "it can't get worse." Still, some of the other judges in the same district may also develop a predilection for patent cases, and in any event they'll likely look at the local case law. There are currently 13 district judges there plus 6 senior district judges.

There was a time when the Munich I Regional Court--a different jurisdiction, but one that has a rotational intradistrict assignment in place--had one plaintiff-friendly rocket docket and another division that was pretty much the opposite (by now they have three that are all very similar). What plaintiffs did there might also work in W.D. of Tex., provided they assert multiple patents from a portfolio and not just one or two patents:

Plaintiffs could bring multiple cases, either asserting patent P1, P2 and P3 separately against defendant D1, or a pattern of P1 v. D1, P2 v. D2, and P3 v. D3. They would then see to whom those cases get assigned, and then drop cases assigned to other judges in favor of amending their complaints pending before Judge Albright or a likeminded judge in the same district by adding more patents and/or more defendants. A patentee with a very large portfolio might actually bring the first few cases over patents that aren't as important as the ones that would be introduced later (through amended complaints). Now, it probably won't be practical to really bring dozens of cases just to be sure that one case will end up with Judge Albright. But if a few other judges there also turn out plaintiff-friendly, then the gamble might work.

What could patentees do for whom the workaround doesn't solve the problem--or if the workaround was thwarted as well?

That question leads us to a limitation of the focus of the Judicial Conference on intradistrict assignments. They try to do what they can, and no one can criticize them for that. Still, the ultimate impact may fall short of the expectations with which some companies and lobbying entities have lobbied Congress for this (which in turn got the Judicial Conference interested).

Patentees seeking to enforce their intellectual property rights increasingly have to "think global." If a patent is on the verge of expiration, or has already expired, then it's all about damages and there's probably no better place in the world to sue for damages than the Western District of Texas--or the Eastern District, but after TC Heartland some defendants are in a better position to get cases moved out of there (the rise of the Western District, where many tech companies have actual operations, is a result of TC Heartland to some degree). But the most effective kind of enforcement is to obtain injunctions (or import bans, such as from the ITC, which are just a special type of injunction).

As I wrote on LinkedIn a few hours ago, the Western (and also the Eastern) District of Texas can "compete" with venues like Munich, Mannheim, or London--not on injunctions (due to eBay), but by giving patentees leverage through the threat of major damages verdicts. Any change in U.S. patent enforcement policy (such as a new position paper by three federal agencies) that softens, slows down, or otherwise complicates enforcement results in ever more litigation in other jurisdictions:

• In Europe, the "race to the bottom" continues and will likely heat up when the Unified Patent Court (UPC) commences its operation sometime this year. For a long transitional period, patentees can choose to bring their complaints in the equivalent of a U.S. district court or a local UPC division-and if they assert more than one patent, they can do both in parallel and see how it works out. After Brexit, the UK judiciary is no longer bound by European Court of Justice decisions, which has actually made the UK an even more attractive place to enforce (though a local legislative initiative concerning standard-essential patents may reverse that trend in the specific context of SEPs). So if one seeks leverage from patent enforcement in Europe, one has the choice between multiple national courts, the UPC, and the UK, which is totally independent.

• China is an increasingly important patent litigation venue. And there are other Asian countries. For example, OPPO is now defending against patent infringement complaints by both Nokia and InterDigital in India, where InterDigital won an anti-antisuit injunction against Xiaomi that probably helped it obtain a settlement last year.

Globalization favors big budgets and large portfolios. I believe that the America Invents Act (AIA)--while the idea wasn't bad--is part of the reason (as is eBay) we've seen the rise of "mega-NPEs." The "anti-Judge-Albright rule" might further contribute to that.

Again, I do understand the concerns of those who have been sued in the Western District of Texas lately. But they should all think it through. The less leverage a person or entity holding a single U.S. patent has, the more the patent enforcement game becomes a battle of materiel, a question of scale. And then the same ones who lobby for stronger defendant's rights are exactly the ones who will complain about hedge funds and other major litigation financiers becoming involved.

The UPC favors deep-pocketed patent holders. What's happening (or about to happen) in the United States with respect to SEPs and the Western District of Texas will serve to reinforce the trend toward consolidation and concentration. We may see some of the effects this year, but more likely in 2023 and 2024.

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Intellectual Ventures predicted 'IP reckoning' for auto sector, then filed patent suits against General Motors, Toyota, Honda in Texas--even involving a former Daimler patent

This is the third post with an automotive industry topic in a row. On this occasion, I'd like to mention that I plan to attend the afternoon panels of the Auto IP Europe conference hosted by IAM in Munich on November 2, and point you to my two previous automotive posts:

• EU competition chief's tough talk on cartels doesn't bode well for automotive SEP licensing negotiation groups

• L2 Mobile Technologies claims Qualcomm chips in Ford, Lincoln cars infringe 3G standard-essential patents originally obtained by ASUSTeK

The automotive industry must license more patents. Some patent holders are patient because they recognize that car makers are relatively new to the wireless patent licensing business--but that doesn't mean everyone will wait forever. On October 13, IAM published an opinion piece by Arvin Patel, the COO of non-practicing entity Intellectual Ventures ("IV"): "Why the auto sector is heading for an IP reckoning" (paywalled)

IV is not going to take the alleged wholesale borrowing of technology in the connected-car era anymore. On October 19, less than a week after that op-ed, IV filed patent infringement complaints against General Motor in the Western District of Texas (over 12 patents), and against Toyota and Honda in the Eastern District of Texas (over 11 patents each).

Let me show you the GM complaint as am embedded document (ths post continues below the document):

21-10-19 Intellectual Ventu... by Florian Mueller

I've also uploaded the Toyota complaint and the Honda complaint to Scribd.

These are the patents-in-suit:

1. U.S. Patent No. 6,832,283 on a "method for addressing network components"; originally filed by Daimler; asserted against all three defendants

2. U.S. Patent No. 7,382,771 on a "mobile wireless hotspot system"; originally filed by In Motion Technology, a company that Sierra Wireless acquired in 2014; asserted against all three defendants

3. U.S. Patent No. 7,484,008 on a "apparatus for vehicle internetworks"; same family as '004 patent; asserted against Toyota

4. U.S. Patent No. 7,684,318 on "shared-communications channel utilization for applications having different class of service requirements"; asserted against all three defendants

5. U.S. Patent No. 7,891,004 on a "method for vehicle internetworks"; same family as '008 patent; asserted against GM and Honda

6. U.S. Patent No. 8,811,356 on "communications in a wireless network"; asserted against all three defendants

7. U.S. Patent No. 8,953,641 on "methods and apparatus for multi-carrier communications with variable channel bandwidth"; asserted against all three defendants

8. U.S. Patent No. 9,232,158 on "large dynamic range cameras"; asserted against all three defendants

9. U.S. Patent No. 9,292,475 on a "device, system and method for controlling speed of a vehicle using a positional information device"; asserted against all three defendants

10. U.S. Patent No. 9,602,608 on a "system and method for notifying a user of people, places or things having attributes matching a user's stated preference"; asserted against all three defendants

11. U.S. Patent No. 9,681,466 on "scheduling transmissions on channels in a wireless network"; from a patent family originally obtained by IPWireless, a company that General Dynamics acquired in 2012; asserted against all three defendants

12. U.S. Patent No. 9,934,628 on a "video recorder"; asserted only against GM

13. U.S. Patent No. 10,292,138 on "determining buffer occupancy and selecting data for transmission on a radio bearer"; from a patent family originally obtained by IPWireless, a company that General Dynamics acquired in 2012; asserted against all three defendants

I find it very interesting that even Daimler apparently divested IP assets to non-practicing entities. Daimler itself gets sued by NPEs all the time now, and can't credibly complain about any NPE's business model...

The complaints do not describe any patent as standard-essential. Reference to WiFI and 3GPP standards like LTE is made, and three of them have been declared essential to LTE according to IPlytics. For the vast majority of the patents-in-suit, standard essentiality can be ruled out just based on what techniques those patents cover.

Even though the profile of IV's patents-in-suit is, therefore, rather distinct from the types of patents in the Avanci pool, it is interesting that patent holders (SEP and non-SEP holders alike) appear less likely to sue Avanci licensees. IV is not an Avanci licensor, so it could even assert SEPs against Avanci licensees.

For SEP holders that are not Avanci licensors there is a serious issue if they sue Avanci licensees: those patent holders tend to seek far higher royalties relative to the value and size of their portfolios, and defendants would then point to the Avanci rate on a per-patent basis as a comparable license (the "ND" ("non-discriminatory") in "FRAND"). Anyone can point to Avanci's published royalty rates--but someone who doesn't even want to license patents at that rate just comes across as an unwilling licensee or even as an unrepentant infringer.

If a non-SEP case is put before a jury, U.S. judges might not accept a SEP pool rate as a relevant point of reference on patent valuation--but at a minimum the judges can see that the defendant is, in principle, a willing licensee. That, in and of itself, has value.

Another possibility is that companies with an Avanci license are also more likely to reach a negotiated agreement with other licensors.

I'll keep an eye on automotive patent infringement cases, and will pay attention to whether there is a pattern of Avanci licensees being sued less than non-licensees.

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Intel points Judge Albright to developments in Delaware: does the chipmaker have a license defense to the $2.2B patent damages verdict?

VLSI Technologies won a patent infringement trial against Intel in the Western District of Texas in March, and lost (because it failed to establish infringement) another one in April. A third VLSI v. Intel trial has been pushed back from the summer to December.

Judge Alan Albright has not yet entered a final judgment further to the March and April jury verdicts. In the first case (the one with the $2.2B record verdict), Intel is fighting hard and has raised a number of issues in its post-trial motions, demonstrating to the trial court that it can easily be reversed on appeal if it doesn't order a retrial or make similarly impactful decisions now. In the second case, VLSI would like another chance to prevail.

In both cases, Intel filed a "notice of subsequent developments" on Monday (this post continues below the document):

21-08-02 Intel Notice of Su... by Florian Mueller

Intel's legal position is that final judgment cannot enter while a motion to amend its answers and defenses is pending. The critical part appears to be a license defense.

As Intel's notice says, the Silicon Valley company "filed a Complaint in the Delaware Court of Chancery against VLSI Technology LLC ('VLSI'), among others, for equitable and other relief relating to its license rights." That happened in January. VLSI brought a motion to dismiss in March, which was heard in May, with no decision having been entered yet by the Delaware state court.

But there is also some VLSI v. Intel patent infringement litigation pending in Delaware--in the District of Delaware, as patent law is federal law. Like in Texas, Intel also filed a motion to amend its answer and defenses in the Delaware patent infringement case. A United States Magistrate Judge held a motion hearing on July 6, 2021, and what Intel wanted to show to Judge Albright is that the Delaware judge "found that Intel's license defense is not futile."

Here's the relevant excerpt from the hearing transcript (this post continues below the document):

21-08-02 Intel Exh1 Hearing... by Florian Mueller

This here is the key passage from what Magistrate Judge Hall said:

"VLSI argues that Intel should not be granted leave to amend under Rule 15 because Intel's license defense is futile and because VLSI would be prejudiced if Intel is allowed to amend.

"Let's talk about futility first. If a proposed amendment is frivolous or advances a claim or defense that is legally insufficient on its face, the Court may deny a leave to amend.

"VLSI makes two arguments about futility. VLSI's first argument has multiple parts, but essentially it argues that Intel could not possibly have obtained a license to the asserted patents under the Finjan settlement.

"At its core of its argument VLSI points to a number of facts that according to VLSI demonstrate that the agreement did not grant Intel a license.

"However, at this stage and without the benefit of a full factual record, I'm not prepared to say as a matter of law that there was no way that Intel could have obtained a license to VLSI's patents pursuant to that agreement.

"VLSI is free to reraise its challenge to Intel's license defense at the summary judgment stage.

"Turning to VLSI's second argument about futility, it argues that Intel's license defense is futile because Intel has conceded that this Court lacks subject-matter jurisdiction over the license defense.

"I don't see a concession. Intel has maintained that it wants to litigate the license issue in the Court of Chancery, but I don't read that as a concession that this Court lacks subject-matter jurisdiction over Intel's license defense.

"In sum, VLSI has not shown that Intel's defense is frivolous or otherwise legally insufficient on its face. I therefore find that it is not futile at this stage."

If Judge Albright ordered a retrial, the license defense might be adjudicated in Delaware in the meantime. If he decides to enter final judgment, however, he will have to somehow rule on Intel's motion to amend its answer and defenses.

Since Apple's $1B trial win in 2012, which even went up to the Supreme Court (disgorgement of profits for design patent infringement), I can't remember a damages verdict having been challenged like Intel is fighting to get VLSI's $2.2B win vacated. Intel leaves no stone unturned. Meanwhile, the busiest patent court in the world (which gets about 20% of all U.S. patent infringement cases) barely finds the time to enter final judgment.

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Serial assertions of the same patent claims in the Western District of Texas against multiple defendants: judicial economy weighs against venue transfer

Once upon a time, there was a federal judicial district to the east of Dallas that every defendant to a patent infringement case sought to leave. Today, that district still exists, and remains pretty important. But the number one hotspot is the Western District of Texas (specifically, its Waco division).

Judge Alan Albright is his lawsuits' keeper, at least when we're talking about patent cases. Not only does he take a long time to rule on venue transfer motions but from time to time he denies venue transfers even though the arguments made by plaintiffs against a transfer are outrageous, such as in a case in which a shell company was set up just to game the system. Unsurprisingly, the exit route from the Western District of Texas quite often passes through the DC-based Federal Circuit.

The Federal Circuit made an interesting--not spectacular, but definitely instructive--decision (PDF) that practicioners should keep in mind. There's a case in which a Canadian company named NCS Multistage is suing a Norwegian company named TCO in the Western District of Texas. The defendant would have preferred to litigate in the Southern District of Texas. But the Federal Circuit found that Judge Albright had not clearly abused his discretion.

The standard of review in a mandamus matter (somewhat similar to an interlocutory appeal) is that there must be a "clear and indisputable" right to relief, which in a venue transfer case means (if there is no clear error) a clear abuse of discretion. Judge Albright placed some emphasis on judicial economy because the plaintiff is suing another defendant in the same court over the same patent claims. However, judicial efficiency is a valid factor. What the district court has to do is just to balance convenience (for the parties and, especially, witnesses) against judicial economy. Only if that balance isn't struck is there a clear abuse of discretion and a basis for a writ of mandamus.

The mandamus petition in this Canadian-Norwegian case was denied "particularly in light of the fact that several potential witnesses are located outside of the proposed transferee venue, including some in the Western District of Texas, and the fact that the only party headquartered in the proposed transferee venue elected to litigate this case in the Western District of Texas."

Look at it this way: it's often a lot easier to complain about something being suboptimal than to propose a clearly superior alternative. Here, it's easy to see that a company headquartered in the Southern District of Texas would probably assert its patents in its home court if it didn't expect a better outcome in the Western District. That was a tactical choice, but not illegitimately tactical. While some witnesses are based in the Southern District, some others are in the Western District. And the plaintiff had previously sued someone else in the latter over the same patent claims. So Judge Albright had sufficient discretion to deny the venue transfer motion in the Federal Circuit's opinion.

The lesson is that serial assertions of the same patent claims in the Western District may work. If the patentee firstly sues a defendant who can't realistically win a venue fight (because it has a strong presence in that district, and the alleged infringement(s) likely had to do with the defendants' activities there, especially R&D), it then has a judicial-economy argument when suing others in the same district. That argument isn't singlehandedly dispositive, but as the failure of TCO's mandamus petition shows, the hurdle is very high as the standard of review is extremely deferential.

It may be easier for state lawmakers to flee from Texas only to derail a vote than for defendants to W.D. Tex. patent cases.

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