Telebrands Corp. v. Illinois Industrial Tool, Inc.
1:17-cv-06765
N.D. Ill.Sep 18, 2017Background
- Telebrands (New Jersey) sued Illinois Industrial Tool, Inc. (IIT) for patent infringement involving decorative lighting; Telebrands alleged venue in the District of New Jersey.
- IIT moved to transfer under 28 U.S.C. § 1400(b) to the Northern District of Illinois, arguing it resides in Illinois and lacks a regular and established place of business in New Jersey.
- IIT submitted a sworn CFO declaration stating its headquarters, majority of employees, officers, and facilities are in Illinois and that it has no offices, employees, shareholders, representatives, contractors, or facilities in New Jersey.
- Telebrands conceded IIT is an Illinois corporation and did not dispute residence; it offered no evidence showing IIT has a regular and established place of business in New Jersey.
- Telebrands requested expedited venue discovery to try to establish IIT’s business presence in New Jersey. The parties did not brief infringement merits.
- The Court found IIT established lack of a regular and established place of business in New Jersey, rejected Telebrands’ request for venue discovery as insufficient to defeat transfer, and ordered transfer to the Northern District of Illinois.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether venue is proper in the District of New Jersey under § 1400(b) (Second Clause: acts of infringement + regular and established place of business) | Telebrands alleged venue in complaint and sought discovery to show IIT’s connections to NJ; contended venue facts not yet fully developed | IIT argued it is deemed to reside in Illinois and has no regular and established place of business in New Jersey (supported by sworn CFO declaration) | Court held venue is improper in New Jersey because Telebrands failed to show the Regular and Established Element; transfer to N.D. Illinois granted |
| Whether Telebrands is entitled to venue-related discovery to try to save venue | Telebrands requested expedited discovery to investigate IIT’s presence in NJ | IIT argued discovery was unnecessary because its sworn declarations demonstrated lack of a regular and established place of business, and discovery would only address personal jurisdiction, not venue under § 1400(b) | Court denied discovery request; held that speculative or jurisdiction-focused discovery cannot defeat a proper § 1400(b) transfer showing |
Key Cases Cited
- TC Heartland LLC v. Kraft Foods Grp. Brands LLC, 137 S. Ct. 1514 (2017) (interpreting § 1400(b): patent suits lie where defendant resides or where it has committed infringement and has a regular and established place of business)
