United States Court of Appeals
for the Federal Circuit
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IN RE ZIMMER HOLDINGS, INC., ZIMMER, INC.,
and ZIMMER US, INC.,
Petitioners.
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2010-M938
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On Petition for Writ of Mandamus to the United
States District Court for the Eastern District of Texas in
case no. 09-CV-0258, Judge T. John Ward.
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ON PETITION FOR WRIT OF MANDAMUS
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Before RADER, Chief Judge, * FRIEDMAN, and GAJARSA,
Circuit Judges.
GAJARSA, Circuit Judge.
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BRYAN S. HALES, Kirkland & Ellis LLP, of Chicago,
Illinois, for petitioners Zimmer Holdings, Inc., et al. Of
counsel on the petition was MICHAEL E. JONES, Potter
Minton PC, of Tyler, Texas.
*
Randall R. Rader assumed the position of Chief
Judge on June 1, 2010.
IN RE ZIMMER HOLDINGS 2
JOSEPH M. VANEK, Vanek Vickers & Masini, P.C. of
Chicago, Illinois, for respondent MedIdea, LLC. With him
on the response was JEFFREY R. MORAN, JR.
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ORDER
Zimmer Holdings, Inc., Zimmer, Inc., and Zimmer US
Inc. (collectively, Zimmer) seek a writ of mandamus to
direct the United States District Court for the Eastern
District of Texas to vacate its March 8, 2010, order
denying Zimmer’s motion to transfer venue, and to direct
the Texas district court to transfer the case to the United
States District Court for the Northern District of Indiana.
MedIdea, LLC objects to the transfer.
I
MedIdea filed this suit in the Eastern District of
Texas. Zimmer has its principal place of business in
Warsaw, Indiana. The complaint states that venue in the
Eastern District of Texas is proper because MedIdea’s
principal place of business is 911 NW Loop 281, Suite
211-38, Longview, Texas.
Zimmer asked the district court to transfer the case to
either the Northern District of Indiana or the Eastern
District of Michigan pursuant to 28 U.S.C. § 1404(a),
which authorizes transfer “for the convenience of parties
and witnesses, in the interest of justice.” Zimmer argued
that MedIdea was not registered to do business in Texas
and that “it was unclear what, if any, relevant business is
actually transacted out of MedIdea’s Longview address, or
whether MedIdea conducts any relevant business
anywhere in the state of Texas.” Zimmer further argued
without contradiction that MedIdea appears to share its
Texas office space with another of its trial counsel’s
clients.
3 IN RE ZIMMER HOLDINGS
Zimmer contended that the Northern District of
Indiana was more convenient and fair for both parties to
try this case. Zimmer noted MedIdea’s extensive ties to
the adjacent state of Michigan—MedIdea was incor-
porated in Michigan, maintained a registered office in
Ann Arbor, Michigan, and both of MedIdea’s officers, the
inventor of the patents-in-suit and the patent prosecuting
attorney, reside in Michigan. Zimmer further noted that
the vast majority of the evidence will come from either
Indiana or Michigan and that eight potential witnesses
reside in Warsaw, Indiana.
The district court denied the motion to transfer. The
court noted that MedIdea is located in Longview, Texas
where it “likely” keeps its relevant evidence. The court
further added that “a business opens its doors in a
particular location for a number of reasons.” The court
declined “to scrutinize litigants’ business decisions in
order to determine whether opening an office in a
particular location has a legitimate business purpose or is
merely a ‘tactic . . . to manipulate venue.’”
The court further stated that the parties’ convenience
did not favor either venue because MedIdea’s location in
Longview “significantly counterbalances” the convenience
to Zimmer’s party witnesses attending trial in Indiana.
The court added that Zimmer had not shown that it would
be significantly inconvenient for it to transfer its
documents to Texas or identified any documents or
evidence that could not be transported without significant
inconvenience.
With regard to local interest considerations, the court
determined that neither the Northern District of Indiana
nor the Eastern District of Texas had a greater interest in
this dispute. The court explained that while Zimmer is
headquartered in the Northern District of Indiana,
“MedIdea maintains its principal place of business in
IN RE ZIMMER HOLDINGS 4
Longview, which gives the Eastern District of Texas [ ] a
substantial connection to this lawsuit.”
The court also stressed the significance of an ongoing
patent suit in the Eastern District of Texas filed by
MedIdea against another defendant. 1 The court described
the second suit as involving the “same patent, the same
plaintiff, and similar technology.” The court further
added that “there will undoubtedly be an overlap of issues
for claim construction,” and that “[t]ransferring this case
to either of the proposed venues will prevent the parties
from taking advantage of the built-in efficiencies that
result from having related cases before the same judge.”
The court therefore concluded that Zimmer had not met
its burden of demonstrating that the proposed venues
were clearly more convenient than the Eastern District of
Texas for trial of the case, and it denied the motion to
transfer.
II
Applying Fifth Circuit law in cases arising from
district courts in that circuit, this court has held that
mandamus may be used to correct a clearly erroneous
denial of transfer. See In re Nintendo Co., 589 F.3d 1194
(Fed. Cir. 2009); In re Hoffmann-La Roche Inc., 587 F.3d
1333 (Fed. Cir. 2009); In re Volkswagen of Am., Inc., 566
F.3d 1349 (Fed. Cir. 2009); In re Genentech, Inc., 566 F.3d
1338 (Fed. Cir. 2009); In re TS Tech USA Corp., 551 F.3d
1315 (Fed. Cir. 2008).
1
See MedIdea, LLC v. Smith & Nephew, Inc.,
2:09-CV-378 (E.D. Tex.). The defendant in this other
action has also recently petitioned this court for a writ of
mandamus seeking to vacate the district court’s denial of
transfer order in that case. See In re Smith & Nephew,
Inc., No. 2010-M940.
5 IN RE ZIMMER HOLDINGS
In determining whether the transferee venue “is
clearly more convenient,” the Fifth Circuit applies the
“public” and “private” factors for establishing forum non
conveniens. Genentech, 566 F.3d at 1342 (citing In re
Volkswagen of Am., Inc., 545 F.3d 304, 314 n.9, 315 (5th
Cir. 2008) (en banc)). As we stated in TS Tech, “[t]he
‘private’ interest factors include: (1) the relative ease of
access to sources of proof; (2) the availability of
compulsory process to secure the attendance of witnesses;
(3) the cost of attendance for willing witnesses; and (4) all
other practical problems that make a trial easy,
expeditious, and inexpensive.” 551 F.3d at 1319. The
public interest factors include: “(1) the administrative
difficulties flowing from court congestion; (2) the local
interest in having localized interests decided at home; (3)
the familiarity of the forum with the law that will govern
the case; and (4) the avoidance of unnecessary problems of
conflicts of laws [or in] the application of foreign law.” Id.
MedIdea claims that its choice of forum for suit in the
district of its principal place of business is entitled to
deference. We disagree. In Hoffmann-LaRoche, this
court noted that in anticipation of the litigation, the
plaintiff’s counsel converted into electronic format 75,000
pages of documents and transferred them from California
to the offices of its litigation counsel in Texas and then
asserted that the location of those documents was a factor
that favored not transferring the case from the Eastern
District of Texas. 587 F.3d at 1336-37. We held that the
assertion that those documents were “Texas” documents
was a fiction that the plaintiff created to manipulate the
propriety of venue and that it was entitled to no weight in
the court’s venue analysis. Id.
MedIdea argues that, unlike in Hoffmann-LaRoche,
its decision to claim its principal place of business in
Texas does not require close scrutiny. We disagree.
Similar to the plaintiff in Hoffmann-LaRoche, MedIdea
IN RE ZIMMER HOLDINGS 6
transported copies of its patent prosecution files from
Michigan to its Texas office space, which it shares with
another of its trial counsel’s clients. Thus, MedIdea’s
presence in Texas appears to be recent, ephemeral, and
an artifact of litigation. See Hertz Corp. v. Friend, 130 S.
Ct. 1181, 1195 (2010) (urging courts to ensure that the
purposes of jurisdictional and venue laws are not
frustrated by a party’s attempts at manipulation).
Our assessment of the realities of this case makes it
clear that the Eastern District of Texas is convenient only
for MedIdea’s litigation counsel. MedIdea is a Michigan
limited liability corporation with a registered office in
Ann Arbor, Michigan and has only two corporate officers,
both residents of Michigan. One is the sole inventor of the
asserted patents while the other is the prosecuting
attorney of record. Aside from uncorroborated
contentions that MedIdea has its principal place of
business in Texas, it is undisputed that all of MedIdea’s
research and development, and patent prosecution work
took place in Michigan. Furthermore, there is no
indication that MedIdea has any employees in Texas.
MedIdea therefore has no presence in Texas that should
be given weight in the transfer analysis. This is a classic
case where the plaintiff is attempting to game the system
by artificially seeking to establish venue by sharing office
space with another of the trial counsel’s clients.
In contradistinction, there are substantial
conveniences in trying this case in the Northern District
of Indiana. See Hertz Corp., 130 S. Ct. at 1195 (stating, in
the context of an inquiry into a corporation’s principal
place of business for diversity jurisdiction purposes, that
“if the record reveals attempts at manipulation – for
example, that the alleged ‘nerve center’ is nothing more
than a mail drop box, a bare office with a computer, or the
location of an annual executive retreat – the court should
instead take as the ‘nerve center’ the place of actual
7 IN RE ZIMMER HOLDINGS
direction, control, and coordination, in the absence of such
manipulation”). Specifically, there are at least eight
identified potentially relevant witnesses in the Northern
District of Indiana and Zimmer’s principal place of
business is located within that district. See Genentech,
566 F.3d at 1343-45 (“In patent infringement cases, the
bulk of the relevant evidence usually comes from the
accused infringer. Consequently, the place where the
defendant’s documents are kept weighs in favor of
transfer to that location.”). Moreover, considering the
proximity of Michigan to Indiana, the “convenience of the
witnesses and parties” and “access to evidence” factors
weigh in favor of transfer because Indiana will also be far
more convenient for MedIdea.
The district court assigned substantial weight in its
analysis to the fact that MedIdea had also filed suit
against another defendant in the same forum. However,
in the circumstances of this case, we cannot say this
negates the significance of having trial close to where
most of the identified witnesses reside and where the
other convenience factors clearly favor. Unlike
Volkswagen, the overlap between MedIdea’s two actions,
both of which are in the infancy stages of litigation, is
negligible. See 566 F.3d at 1351 (denying petition to
transfer where judicial economy is served by having the
same district court try multiple infringement suits
against a total of thirty foreign and domestic automobile
manufacturers involving the same technical patents). In
the instant action, MedIdea alleges infringement of two
patents related to hip implants and four patents related
to shoulder implants. Whereas, in the other action,
MedIdea alleges infringement of nine patents related to
knee implants and a single patent related to shoulder
implants. Because the cases involve different products
with only a single overlapping patent and no defendant is
involved in both actions, it is likely that these cases will
IN RE ZIMMER HOLDINGS 8
result in significantly different discovery, evidence,
proceedings, and trial.
In light of the substantial conveniences in trying this
case in the Northern District of Indiana, the limited
relationship between this case and MedIdea’s other
pending suit in the Eastern District of Texas and because
the only connection between this case and the plaintiff’s
chosen forum is a legal fiction, we determine that the
petitioners have met their burden of demonstrating that
transfer in this case is required.
9 IN RE ZIMMER HOLDINGS
Accordingly,
IT IS ORDERED THAT:
The petition for a writ of mandamus is granted. The
district court shall vacate its March 8, 2010 order and
transfer the case to the United States District Court for
the Northern District of Indiana.
FOR THE COURT
June 24, 2010 /s/ Jan Horbaly
Date Jan Horbaly
Clerk
cc: Bryan S. Hales, Esq.
Joseph M. Vanek, Esq.
Clerk, United States District Court for the Eastern
District of Texas