908 F.3d 1301
Fed. Cir.2018Background
- Plaintiffs AlmondNet, Datonics, and Intent IQ sued Oath (formerly Yahoo) for patent infringement in the Eastern District of New York in March 2016.
- Oath is incorporated in Delaware, does business in New York, but admits it lacks a “regular and established place of business” in the Eastern District under 28 U.S.C. § 1400(b).
- Oath filed and then withdrew a Rule 12(b)(6) motion in July 2016 and answered the complaint in January 2017, admitting venue allegations but expressly reserving the right to challenge venue pending the Supreme Court’s then-upcoming TC Heartland decision.
- After the Supreme Court’s TC Heartland decision (May 2017) narrowed § 1400(b) residency to state of incorporation, Oath moved under Rule 12(b)(3) (June 2017) to dismiss for improper venue; the district court denied the motion as waived under Rules 12(g)(2)/12(h)(1).
- This Court previously decided In re Micron (Fed. Cir.) that TC Heartland effected a controlling change in the law such that the venue defense based on TC Heartland was not “available” before TC Heartland and thus not waived under Rules 12(g)(2)/12(h)(1). The district court declined to follow Micron; this mandamus petition followed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Oath waived its § 1400(b) venue defense under Rules 12(g)(2) and 12(h)(1) by not asserting it before TC Heartland | Oath: no waiver because TC Heartland changed controlling law and the defense was not then "available" | Respondents: waiver applies because the defense was available when Oath filed its initial Rule 12 motion | Court: No waiver—Micron controls; TC Heartland changed controlling law so Rules 12(g)(2)/12(h)(1) do not bar Oath’s post-TC Heartland objection |
| Whether Federal Circuit or regional circuit law governs waiver/venue issues after TC Heartland | Oath: Federal Circuit law governs patent-venue interpretation and waiver questions | Respondents: Second Circuit waiver standards differ; Micron arose in First Circuit | Court: Federal Circuit law governs patent-venue waiver/forfeiture; Micron is controlling here |
| Whether venue rights were forfeited under § 1406(a) or district-court discretion despite no Rule 12 waiver | Oath: no forfeiture—filed venue motion within 21 days of TC Heartland, early-stage case, no conduct suggesting consent | Respondents: forfeiture/forfeiture-like estoppel based on Oath’s prior conduct and admissions | Court: No forfeiture shown—district court gave no adequate analysis; record lacks tactical delay, significant judicial investment, or post-TC Heartland conduct showing consent |
| Appropriate remedy if venue improper in EDNY | Oath: case must be dismissed or transferred under § 1406(a) | Respondents: if mandamus granted, prefer transfer rather than outright dismissal | Court: Mandamus granted; vacated district orders and remanded with instruction to dismiss or transfer to a district where case could have been brought |
Key Cases Cited
- TC Heartland LLC v. Kraft Foods Grp. Brands LLC, 137 S. Ct. 1514 (2017) (Supreme Court narrowed patent-venue residency to state of incorporation)
- VE Holding Corp. v. Johnson Gas Appliance Co., 917 F.2d 1574 (Fed. Cir. 1990) (prior Federal Circuit rule treating residence as where personal jurisdiction existed)
- In re Micron Technology, Inc., 875 F.3d 1091 (Fed. Cir. 2017) (TC Heartland changed controlling law; venue defense not waived under Rules 12(g)(2)/12(h)(1))
- Fourco Glass Co. v. Transmirra Prods. Corp., 353 U.S. 222 (1957) (earlier Supreme Court precedent on patent venue reaffirmed by TC Heartland)
- In re ZTE (USA) Inc., 890 F.3d 1008 (Fed. Cir. 2018) (Federal Circuit governs burden of persuasion on patent venue)
- In re BigCommerce, Inc., 890 F.3d 978 (Fed. Cir. 2018) (district courts may consider forfeiture under § 1406(b), but such discretion must be exercised cautiously)