ESCO Corp. v. Cashman Equipment Co.
65 F. Supp. 3d 626
C.D. Ill.2014Background
- ESCO Corp. (Oregon) and ESCO Canada sued Caterpillar Inc., Caterpillar Global, Raptor USA, Raptor Mining, and Cashman (a Nevada Caterpillar dealer) for infringement of several patents in August 2012 in the District of Nevada; Caterpillar had earlier sued ESCO in the Central District of Illinois.
- The Illinois case (Caterpillar v. ESCO) was transferred to Nevada for consolidation; Nevada later consolidated and then transferred the consolidated case back to the Central District of Illinois under 28 U.S.C. § 1404(a).
- Plaintiffs moved in Illinois to retransfer the case to Nevada, arguing the Nevada court lacked power to transfer because, at the time the ESCO suit was filed in Nevada, this Court lacked personal jurisdiction over some defendants (specifically Cashman and the Raptor entities).
- The Illinois court reviewed whether, at the time of filing, the action "might have been brought" in this district (i.e., whether venue and personal jurisdiction over all defendants existed), applying Federal Circuit law for personal jurisdiction in patent cases.
- The court concluded it plausibly had jurisdiction over Caterpillar and the Raptor defendants but found it lacked personal jurisdiction over Cashman because Cashman’s only Illinois contacts were purchases from Caterpillar and dealer communications — purchasing alone did not support specific jurisdiction for patent infringement claims.
- Because the action could not have been brought in this district as to all defendants at filing, the court granted Plaintiffs’ motion and retransferred the matter to the District of Nevada.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Nevada properly transferred the consolidated case under § 1404(a) | Transfer was improper because, at suit filing, Illinois lacked personal jurisdiction over all defendants | Transfer was proper because defendants joined the transfer motion, waiving jurisdiction objections | Retransfer required because this district did not have personal jurisdiction over all defendants at filing (waiver insufficient under § 1404(a) inquiry) |
| Whether this action "might have been brought" in Illinois (venue/jurisdiction at time of filing) | Action could not have been brought here because not all defendants were subject to Illinois jurisdiction when ESCO filed in Nevada | Defendants argued personal jurisdiction existed (general or specific) over all defendants, and joining transfer showed consent | Court held the relevant inquiry looks to the state of facts at filing; because Cashman lacked sufficient contacts, the suit could not have been brought here |
| Whether Cashman is subject to general jurisdiction in Illinois | Plaintiffs: Cashman is not at home in Illinois | Defendants: Cashman’s regular business with Caterpillar in Illinois establishes continuous/systematic contacts | Held: Insufficient evidence that Cashman was "essentially at home" in Illinois; general jurisdiction not established |
| Whether Cashman is subject to specific jurisdiction for patent infringement | Plaintiffs: Cashman’s purchases in Illinois do not create the necessary nexus to alleged infringement (which is based on selling) | Defendants: Cashman’s contracts, communications, purchases from Caterpillar in Illinois make its alleged infringing activity arise out of or relate to Illinois contacts | Held: Cashman’s purchasing activity in Illinois does not create the requisite nexus for patent infringement; specific jurisdiction lacking |
Key Cases Cited
- Coffey v. Van Dorn Iron Works, 796 F.2d 217 (7th Cir. 1986) (transfer decisions grant broad discretion to courts)
- Christianson v. Colt Indus. Operating Corp., 486 U.S. 800 (U.S. 1988) (law-of-the-case limits revisiting transfer decisions but does not eliminate jurisdictional obligations)
- Arizona v. California, 460 U.S. 605 (U.S. 1983) (law-of-the-case doctrine governs subsequent stages of same case)
- Hoffman v. Blaski, 363 U.S. 335 (U.S. 1960) (§ 1404(a) transfer depends on whether transferee district "might have been brought" at time of filing)
- Trintec Indus., Inc. v. Pedre Promotional Products, Inc., 395 F.3d 1275 (Fed. Cir. 2005) (venue in patent actions exists where personal jurisdiction exists)
- Hildebrand v. Steck Mfg. Co., 279 F.3d 1351 (Fed. Cir. 2002) (Federal Circuit law governs personal jurisdiction in patent suits)
- Avocent Huntsville Corp. v. Aten Int’l Co., Ltd., 552 F.3d 1324 (Fed. Cir. 2008) (specific jurisdiction test in patent cases focuses on commercialization nexus in the forum)
- Inamed Corp. v. Kuzmak, 249 F.3d 1356 (Fed. Cir. 2001) (discussion of "arise out of or relate to" standard)
- Akro Corp. v. Luker, 45 F.3d 1541 (Fed. Cir. 1995) (three-factor specific jurisdiction test)
- Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408 (U.S. 1984) (focus on relationship among defendant, forum, and litigation)
- Int’l Shoe Co. v. Washington, 326 U.S. 310 (U.S. 1945) (minimum contacts and due process)
- World–Wide Volkswagen Corp. v. Woodson, 444 U.S. 286 (U.S. 1980) (purposeful availment principle)
- Burger King Corp. v. Rudzewicz, 471 U.S. 462 (U.S. 1985) (fair warning via purposeful availment)
- Rush v. Savchuk, 444 U.S. 320 (U.S. 1980) (must assess contacts individually)
- Calder v. Jones, 465 U.S. 783 (U.S. 1984) (each defendant’s contacts must be assessed separately)
- Goodyear Dunlop Tires Operations, S.A. v. Brown, 131 S. Ct. 2846 (U.S. 2011) (general jurisdiction requires defendant be "essentially at home")