SHERWIN-WILLIAMS COMPANY v. PPG INDUSTRIES, INC.
2:17-cv-01023
W.D. Pa.Aug 4, 2017Background
- Valspar sued PPG for patent infringement (BPA-free can coatings), filing in the District of Minnesota on May 23, 2016.
- PPG initially conceded venue in Minnesota and moved to transfer under 28 U.S.C. § 1404(a); the court denied that motion.
- After the Supreme Court decided TC Heartland (May 22, 2017), PPG moved to amend its answer to deny venue and moved to dismiss (or alternatively transfer) under Rule 12(b)(3), arguing TC Heartland changed patent-venue law.
- Valspar argued PPG waived the venue defense by failing to raise it earlier; PPG argued the defense was unavailable before TC Heartland because Federal Circuit precedent (VE Holding) controlled.
- The court found TC Heartland constituted an intervening change in the law, allowed PPG to amend its answer, denied venue discovery, and transferred the case to the Western District of Pennsylvania under 28 U.S.C. § 1406(a).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether PPG waived objection to improper venue by not raising it earlier | Valspar: PPG waived venue defense by conceding venue and failing to raise it in initial pleadings | PPG: Defense was unavailable before TC Heartland due to controlling Federal Circuit precedent (VE Holding); TC Heartland is an intervening change | Court: No waiver; TC Heartland was an intervening change in law that excused late assertion; granted leave to amend |
| Whether TC Heartland should be applied retroactively to this pending case | Valspar: Waiver argument implies no retroactivity; but requested discovery | PPG: TC Heartland should apply retroactively and invalidate Minnesota venue | Court: Applied TC Heartland retroactively (citing Harper) |
| Whether venue is proper in Minnesota under § 1400(b) after TC Heartland | Valspar: Sought venue discovery to show acts of infringement or "regular and established place of business" in Minnesota | PPG: No acts of infringement and no regular and established place of business in Minnesota | Court: Valspar failed to show facts; denied venue discovery as unlikely to produce new evidence; venue improper |
| Remedy: Dismissal vs. Transfer | Valspar: Did not press dismissal; wanted opportunity to litigate in Minnesota | PPG: Asked for dismissal or, alternatively, transfer to Western District of Pennsylvania where venue is proper | Court: Exercised discretion under § 1406(a) to transfer case to W.D. Pa. rather than dismiss |
Key Cases Cited
- Fourco Glass Co. v. Transmirra Prods. Corp., 353 U.S. 222 (established that for patent venue § 1400(b), corporate "residence" means state of incorporation)
- VE Holding Corp. v. Johnson Gas Appliance Co., 917 F.2d 1574 (Fed. Cir.) (held corporate "residence" for patent venue included districts where corporation was subject to personal jurisdiction)
- TC Heartland LLC v. Kraft Foods Grp. Brands LLC, 137 S. Ct. 1514 (Sup. Ct. 2017) (reaffirmed Fourco and held § 1400(b) residence refers only to state of incorporation for domestic corporations)
- Harper v. Virginia Dep’t of Taxation, 509 U.S. 86 (held new rules of law apply retroactively where appropriate)
- Foman v. Davis, 371 U.S. 178 (sets standard that leave to amend should be freely given when justice requires)