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Digital Background Corp. v. Apple

March 17, 2008

DIGITAL BACKGROUND CORPORATION, PLAINTIFF,
v.
APPLE, INC., DEFENDANT.



The opinion of the court was delivered by: J. Phil Gilbert District Judge

MEMORANDUM AND ORDER

This matter comes before the Court on Defendant Apple, Inc.'s Motion to Transfer Venue (Doc. 25). Plaintiff Digital Background Corporation has filed a response (Doc. 30) and Apple, Inc. has replied (Doc. 31). For the following reasons, the Court GRANTS the Motion.

BACKGROUND

Plaintiff Digital Background Corporation (DBC) brought this suit for patent infringement against Defendant Apple, Inc. (Apple). DBC is a patent holding company that seeks to license intellectual property. DBC alleges that the "backdrop" feature of iChat, offered with Apple's "Leopard" operating system, infringes on United States Patent Number 5,764,306 (Patent '306). DBC alleges a second company, Digital Property Management Group, LLC (DPMG) is the assignee of Patent '306. The Leopard operating system is offered for sale nationwide, including in the Southern District of Illinois.

Apple is a corporation incorporated under the laws of California, having its principal place of business in Cupertino, California, which is embraced by the Northern District of California. DBC is a corporation incorporated under the laws of Delaware, having its principal place of business in Newport Beach, California, which is embraced by the Central District of California. DPMG, the assignee of the '306 patent, was organized in Texas, with its initial registered office located in Dallas, Texas.

DPMG's sole organizer and manager, Bruce Renouard, resides the Northern District of California. The two Apple engineers who designed and developed the backdrop feature at issue reside in the Northern District of California. Additionally, almost all of the domestic employees involved with the development and marketing of the backdrop feature at issue work at Apple's headquarters located in the Northern District of California. The inventor of the '306 patent, Michael Steffano, resides in Austin, Texas. The patent attorney who prosecuted the '306 patent, William Hulsey, also resides in Austin, Texas.

Neither party asserts that any potential witnesses reside in the Southern District of Illinois. Neither party asserts that any relevant documents or facilities are located within the Southern District of Illinois. At least two retailers in the Southern District of Illinois sold the product at issue.*fn1

ANALYSIS

In patent cases, venue is governed by 28 U.S.C. § 1400(b), which provides: "Any civil action for patent infringement may be brought in the judicial district where the defendant resides, or where the defendant has committed acts of infringement and has a regular and established place of business." For purposes of 28 U.S.C. § 1400 (b), a non-resident corporate defendant "shall be deemed to reside in any judicial district in which it is subject to personal jurisdiction at the time the action commenced." 28 U.S.C. § 1391(c).

As a preliminary matter, the Court notes that it has subject matter jurisdiction over patent infringement suits pursuant to 28 U.S.C.§§ 1331 and 1338(a). Additionally, Apple concedes that it is, and was at the time this action commenced, subject to personal jurisdiction in the Southern District of Illinois. Because Apple was subject to personal jurisdiction in this district, it is deemed to have resided here, making venue appropriate in this Court.

Because Apple's principal place of business is in Cupertino, California, Apple is also subject to personal jurisdiction in the Northern District of California. Therefore, venue is also proper in that district. Apple contends that, as venue is more convenient in the Northern District of California, the case should be transferred there.

When a suit is filed with proper venue in a district court, that court may "[f]or the convenience of parties and witnesses, in the interest of justice ... transfer any civil action to any other district or division where it might have been brought." 28 U.S.C. § 1404(a); Coffey v. Van Dorn Iron Works 796 F.2d 217, 219 (7th Cir.1986). The moving party bears the burden of showing particular circumstances that establish that the transferee forum is clearly the more convenient of the two. Id. at 219-20. The decision to transfer a case is left to the discretion of the district court. Stewart Org., Inc. v. Ricoh Corp., 487 U.S. 22, 29 (1988); Van Dusen v. Barrack, 376 U.S. 612, 622 (1964); Cote v. Wadel, 796 F.2d 981, 985 (7th Cir. 1986); see Norwood v. Kirkpatrick, 349 U.S. 29, 32 (1955).

I. Factors to be Evaluated

In evaluating whether to transfer a case, the district court must weigh factors of "convenience" including: the plaintiff's choice of forum, the situs of material events, the courts's respective power to compel the appearance of unwilling witnesses at trial, and the costs associated with transporting and housing witnesses to the respective forums. See Coffey, 796 F.2d at 219; Forcillo v. LeMonde Fitness, Inc., 220 F.R.D. 550, 551 (S.D.Ill. 2004); 15 C. Wright, A. Miller & E. Cooper, Federal Practice ยงยง 3849-53 (1986). Additionally, the Court must weigh factors of "justice" including: the courts's respective familiarity with the applicable law, the speed at which these types of cases are typically resolved in the respective forums, and the relation of the respective communities to the ...


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