Case 2:17-cv-04263-JVS-JCG Document 30-4 Filed 09/25/17 Page 1 of 10 Page ID #:585
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`Broadcom Corp. v. Sony Corp.,
`SACV 16-1052 JVS (JCGx)
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`Order DENYING Motion to Transfer
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`Defendants Sony Corporation (“Sony”), Sony Corporation of America
`(“Sony America”), Sony Interactive Entertainment America LLC (“Sony
`Interactive”), and Sony Electronics Inc. (“Sony Electronics”) (together, the “Sony
`Defendants”) have moved to transfer this case to the Northern District of
`California. Docket No. 43. For the reasons stated below, the Court denies the Sony
`Defendants’ motion to transfer.
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`1.
`
`Background
`
`Plaintiff Broadcom Corporation is a California corporation with its principal
`place of business in Irvine, California. Docket No. 1 ¶ 1. Plaintiff Avago
`Technologies General IP (Singapore) Pte. Ltd. (“Avago”) is a Singapore
`corporation with its principal places of business in San Jose, California, and
`Singapore. Id. ¶ 2. Broadcom designs, develops, and supplies semiconductors.1 Id.
`¶¶ 23-24. As part of its semiconductor business, Broadcom maintains a patent
`portfolio consisting of various patents for use in consumer electronic products. Id.
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`The Sony Defendants manufacture and sell professional and consumer
`electronic, entertainment, and gaming products. Their business operations span
`throughout the United States and East Asia. Sony is a Japanese corporation with its
`principal place of business in Tokyo. Id. ¶ 3. Sony America is a New York
`Corporation with its principal place of business in New York City. Id. ¶ 4. Sony
`Interactive is a Delaware corporation with its principal place of business in San
`Mateo, California. Id. ¶ 5. Sony Electronics is a Delaware corporation with its
`principal place of business in San Diego, California. Id. ¶ 6.
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`In June 2016, Broadcom sued the Sony Defendants for patent infringement
`in the Central District of California. See generally id. The complaint alleges that
`certain components in Sony consumer electronic products, including Sony
`televisions, cameras, audio and visual media players, and gaming devices, infringe
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`1 The Court refers to the plaintiffs together as “Broadcom.”
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`ten patents in the Broadcom portfolio. Id. ¶¶ 27-97. These ten patents relate to
`techniques for video and audio encoding and decoding, wireless communication,
`and colored lighting. Id. The Sony Defendants now move to transfer this case to
`the Northern District under 28 U.S.C. § 1404(a).
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`2.
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`Legal Standard
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`28 U.S.C. § 1404(a) allows courts, in their discretion, to transfer a case to
`another district when it would be convenient to do so. 28 U.S.C. § 1404(a). Courts
`must perform a two-step analysis when determining whether transfer is appropriate
`under section 1404(a). First, the court must determine whether the case could have
`been brought in the proposed transferee venue. Id. Second, the court must
`determine whether transferring the case would serve the convenience of the parties
`and the witnesses and promote the interests of justice. Id. The moving party bears
`the burden of showing that transfer is appropriate. Commodity Futures Trading
`Comm’n v. Savage, 611 F.2d 270, 279 (9th Cir. 1979).
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`3.
`
`Analysis
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`3.1. This case could have been brought in the Northern District.
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`The Court must first consider whether the case could have been brought in
`the Northern District. 28 U.S.C. § 1404(a). This requires the Court to determine
`whether the transferee venue would have had subject-matter jurisdiction,
`defendants would have been subject to the transferee venue’s personal jurisdiction,
`and venue would have been proper in the transferee venue. Abrams Shell v. Shell
`Oil Co., 165 F. Supp. 2d 1096, 1103 (C.D. Cal. 2001).
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`The parties agree that this case could have been brought in the Northern
`District. First, the Northern District would have had subject-matter jurisdiction
`over Broadcom’s patent infringement claims. See Gunn v. Minton, --- U.S. ---, 133
`S.Ct. 1059, 1068 (2013) (observing “the federal courts’ exclusive patent
`jurisdiction”). Second, the Sony Defendants would have been subject to the
`Northern District’s personal jurisdiction: the Sony Defendants are all either
`headquartered in the Northern District or would have consented to the Northern
`District’s jurisdiction for purposes of this action. See J. McIntyre Mach., Ltd. v.
`Nicastro, 564 U.S. 873, 880 (2011) (consent sufficient for personal jurisdiction).
`Third, for the same reasons, venue would have been proper in the Northern
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`District. See 28 U.S.C. §§ 1400(b) (venue in patent infringement cases is proper in
`any district where the defendant resides), 1391(c) (corporate defendant resides in
`any district where it is subject to personal jurisdiction).
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`3.2. Transferring venue would not serve the convenience of the parties and
`witnesses and promote the interests of justice.
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`The Court must next consider whether transferring venue to the Northern
`District would serve the convenience of the parties and the witnesses and promote
`the interests of justice. 28 U.S.C. § 1404(a). At this step, courts must perform “an
`individualized, case-by-case determination of convenience and fairness.” Stewart
`Org., Inc. v. Ricoh Corp., 487 U.S. 22, 29 (1988). To assist the courts with this
`determination, the Ninth Circuit has identified various factors that courts may
`consider when determining whether transfer would promote the interests of justice.
`Jones v. GNC Franchising, Inc., 211 F.3d 495, 498-99 (9th Cir. 2000). Of these
`factors, the plaintiff’s choice of forum carries the most weight. Thus, there is a
`strong presumption in favor of preserving the plaintiff’s choice of forum. Decker
`Coal, 805 F.2d at 843. “The defendant must make a strong showing of
`inconvenience to warrant upsetting the plaintiff’s choice of forum.” Id. (emphasis
`added).
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`Here, the Sony Defendants argue that transferring venue to the Northern
`District is appropriate for three reasons: (1) transferring venue would promote
`judicial economy; (2) transferring venue would serve the convenience of non-party
`witnesses; and (3) the parties have a stronger relationship to the Northern District.
`See Docket No. 43-1 at 11-25; see also Docket No. 48 at 5-13. As explained infra,
`the Court rejects these arguments, and determines that the Sony Defendants’
`showing is insufficient to warrant upsetting Broadcom’s choice to proceed in the
`Central District. The Court therefore denies the Sony Defendants’ motion to
`transfer.
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`3.2.1.
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`Judicial economy
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`In determining whether judicial economy favors transfer, the court must
`consider such factors as “ensuring speedy trials, trying related litigation together,
`and having a judge who is familiar with the applicable law try the case.” Heller
`Fin., Inc. v. Midwhey Powder Co., 883 F.2d 1286, 1293 (9th Cir. 1989). When the
`case presents “several highly technical factual issues,” and the other interest of
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`justice factors are in equipoise, “the interest of judicial economy may favor transfer
`to a court that has become familiar with the issues.” Regents of the Univ. of
`California v. Eli Lilly & Co., 119 F.3d 1559, 1565 (Fed. Cir. 1997).
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`Here, the Sony Defendants argue that transferring venue would promote
`judicial economy because the Northern District has already held two claim
`construction hearings on the patents at issue. Docket No. 43-1 at 11-15. This
`argument relies primarily on the transfer order in LSI Corp. v. Funai Electric Co.
`Ltd., No. 12-2047 (C.D. Cal. Aug. 21, 2015) (“Funai”), Docket No. 62. Id. at 12,
`14; see also Docket No. 48 at 7-9. In that order, the Central District transferred a
`patent infringement action to the Northern District in part because the Northern
`District had already held claim construction hearings on the patents at issue in that
`action, including two of the same patents at issue here. Funai, Docket No. 62 at 3.
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`The Court disagrees that transferring venue here would significantly
`promote judicial economy. Importantly, the Sony Defendants overstate the scope
`of the Northern District’s prior claim construction hearings regarding the ten
`patents at issue here. In Funai, the Northern District had held claim construction
`hearings on four of the five patents at issue in that action. Id. Here, however, the
`Northern District has held claim construction hearings on only three of the ten
`patents at issue here. Docket No. 45 at 22-24. Moreover, those claim construction
`hearings interpreted only five terms within two of those three patents. Id. at 24.
`Given the limited scope of the Northern District’s prior claim construction
`hearings, the parties will need to engage in extensive motion practice regarding the
`non-overlapping patents and their respective terms, regardless of transfer.2
`Transferring venue therefore would not significantly promote judicial economy
`here.
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`2 Moreover, in the event the Court agrees with the Northern District’s prior claim
`construction rulings, the Court can simply adopt these rulings. If not, the Court is free to adopt
`different constructions. See Rambus, Inc. v. Hynix Semiconductor, Inc., 569 F. Supp. 2d 946,
`966 (N.D. Cal. 2008) (“This general practice [of conducting independent inquiries of prior claim
`constructions] accords with the insight that a fresh look at a claim construction can hone a prior
`court’s understanding and construction of a patent.”). Regardless of this Court’s final claim
`construction rulings, having this Court conduct an independent inquiry of prior claim
`constructions would not interfere with dual federal policies regarding the efficient and fair
`resolution of patent infringement claims.
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`3.2.2.
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`Non-party witnesses
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`“The relative convenience to the witnesses is often recognized as the most
`important factor to be considered in ruling on a motion under § 1404(a).” Saleh v.
`Titan Corp., 361 F. Supp. 2d 1152, 1160 (S.D. Cal. 2005) (citation omitted). To
`sustain its burden of establishing inconvenience to witnesses, the moving party
`must produce evidence establishing (1) the identity and location of the witnesses;
`(2) the content of their testimony; (3) the relevance of their testimony to the action;
`and (4) how transferring the case would serve the convenience of those witnesses.
`Amini Innovation Corp. v. JS Imports, Inc., 497 F. Supp. 2d 1093, 1112 (C.D. Cal.
`2007); Cochran v. NYP Holdings, Inc., 58 F. Supp. 2d 1113, 1119 (C.D. Cal.
`1998). In attempting to establish inconvenience to the witnesses, the moving party
`cannot rely on “vague generalizations of inconvenience.” Cochran, 58 F. Supp. 2d
`at 1119 (internal quotation marks omitted).
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`Here, the Sony Defendants argue that transferring venue would serve the
`convenience of several non-party witnesses who are located in the San Francisco
`area, including third-party inventors of the patents at issue here and third-party
`suppliers of certain components in the accused Sony products. Docket No. 43-1 at
`15-20. The Court disagrees for two reasons.
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`First, the Sony Defendants have failed to establish that transferring venue
`would significantly serve the convenience of the third-party inventors. Together,
`the parties identify six such inventors. Of the six inventors, only two would
`possibly be inconvenienced by proceeding in the Central District: three of the
`inventors who are located in the San Francisco area have affirmatively stated that
`they would testify in the Central District, Docket Nos. 46-2, -3, -4, and one
`inventor is located near Los Angeles, Docket No. 43-1 at 20. Moreover, the Court
`must discount the possible inconvenience to these two inventors by the
`inconvenience to the Southern California-based inventor in the event that transfer
`was granted. See Decker, 805 F.2d at 843 (requiring courts to consider whether
`“transfer would merely shift rather than eliminate the inconvenience”). When
`discounting for the inconvenience to this inventor, the “net” convenience to be
`gained by transferring venue would be equal to that of only one inventor. This
`difference is minimal, and it does not justify transferring venue here.
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`Second, the Sony Defendants have failed to establish that transferring venue
`would serve the convenience of the third-party suppliers. Importantly, the Sony
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`Defendants altogether fail to specifically identify any AMD, Cadence, or Marvell
`employees that would be inconvenienced if the case proceeded in the Central
`District.3 The Defendants instead speculate that, because AMD, Cadence, and
`Marvell’s respective headquarters are located near San Francisco, transferring
`venue to the Northern District “will likely be more convenient” for any witnesses
`employed by these companies. Docket No. 43-1 at 17. Speculation regarding
`possible inconvenience to unidentified third parties is not enough to establish
`inconvenience to non-party witnesses. See Amini, 497 F. Supp. 2d at 1112;
`Cochran, 58 F. Supp. 2d at 1119. The Sony Defendants have therefore not met
`their burden of establishing inconvenience here.
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`3.2.3.
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`The parties’ relationship with the forum.
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`Lastly, the Sony Defendants argue that transferring venue is appropriate here
`because the parties have a stronger relationship to the Northern District.4 Docket
`No. 43-1 at 21-25. Specifically, the Sony Defendants argue that transferring venue
`to the Northern District is appropriate because (1) the domestic headquarters for
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`3 In their reply, the Sony Defendants identify for the first time two third-party witnesses
`purportedly employed by AMD and Cadence. Docket No. 48 at 5, 9-10. Absent exceptional
`circumstances, courts generally cannot consider evidence presented for the first time in a reply
`brief. See Provenz v. Miller, 102 F.3d 1478, 1483 (9th Cir. 1996) (holding that “[w]here new
`evidence is presented in a reply to a motion for summary judgment, the district court should not
`consider the new evidence without giving the [non-]movant the opportunity to respond” (internal
`quotation marks omitted)). In their reply, the Sony Defendants explain that they failed to identify
`these witnesses in their motion because, “[i]n the interest of judicial efficiency, Sony brought
`this motion in the early stages of the case before all details regarding specific witnesses are
`known.” Docket No. 48 at 5. The Court rejects this explanation. When, as here, the defendant
`moves to transfer venue based on inconvenience to non-party witnesses, the defendant bears the
`express burden of specifically identifying all non-party witnesses relevant to the court’s transfer
`analysis. See Amini, 497 F. Supp. 2d at 1112; Cochran, 58 F. Supp. 2d at 1119. Defendants do
`not serve judicial efficiency by failing to identify these witnesses in their initial motion, thereby
`depriving plaintiffs of an opportunity to rebut the defendants’ arguments and evidence for
`transfer. Judicial efficiency is instead better served by having both sides fully brief all issues
`relevant to the particular motion in the first instance.
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`4 This argument implicates several factors relevant to transfer analysis, including (1) the
`parties’ respective contacts with the forum; (2) the relationship between the plaintiff’s claims
`and the forum; (3) litigation costs and expenses; (4) convenience to the parties; and (5)
`convenience to party witnesses. See Jones, 211 F.3d at 498-99.
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`Avago is located in San Mateo; (2) the domestic headquarters for Broadcom’s
`parent company, Broadcom Limited, is located in San Jose; (3) all relevant
`activities regarding the accused Sony gaming products are conducted in San
`Mateo; (4) all party witnesses regarding these activities are located in the Northern
`District; and (5) three of the patents at issue here were invented in the Northern
`District. Docket No. 43-1 at 15, 21-25; see also Docket No. 48 at 11-14. The Court
`rejects this argument.
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` “In patent infringement actions, the preferred forum is that which is the
`center of gravity of the accused activity.” Amazon.com v. Cendant Corp., 404 F.
`Supp. 2d 1256, 1260 (W.D. Wash. 2005) (internal quotation marks omitted). “The
`district court ought to be as close as possible to the milieu of the infringing device
`and the hub of activity centered around its production.” Id. (internal quotation
`marks omitted).” This requires the court to determine where the allegedly
`infringing products were designed, developed, and produced. Arete Power, Inc. v.
`Beacon Power Corp., 2008 WL 508477, at *5 (N.D. Cal. Feb. 22, 2008) (“The law
`asks us, here, to identify the principal location of the legally operative facts-and in
`patent cases that location generally is where the allegedly infringing product was
`designed, developed and produced.”). “This makes sense because in determining
`whether infringement has been established, the principal target of inquiry is the
`design and construction of the accused product. The trier of fact will be asked to
`compare the claims in the patent with the accused product-examining its
`development, its components, its construction, and how it functions.” Id.
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`Here, Broadcom has presented evidence establishing substantial contacts
`with the Central District relating to its claims for patent infringement. This
`includes, most importantly, declaration testimony from Broadcom human resources
`personnel establishing that (1) Broadcom maintains its principal place of business
`in Irvine, California, and that (2) Broadcom makes ultimate business and legal
`decisions regarding domestic patent prosecution at its Irvine offices. Docket No.
`46-1 ¶¶ 7-8. Moreover, the Sony Defendants have presented no countervailing
`evidence regarding the location of the design, development, and production of the
`accused Sony products. On that basis alone, the Sony Defendants have failed to
`sustain their burden of showing that the Northern District is the “preferred forum”
`for Broadcom’s patent infringement claims. Amazon.com, 404 F. Supp. 2d at 1260.
`Indeed, the Sony Defendants have presented evidence suggesting the opposite;
`namely, that the Central District is the preferred forum because it is closer to the
`“milieu of the [accused Sony products] and the hub of activity centered around
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`[their] production.” Id. Specifically, the Sony Defendants have presented evidence
`that, apart from certain marketing activities that are conducted at Sony
`Electronics’s San Jose offices, all activities regarding the accused Sony products
`are conducted at Sony Electronics’s headquarters in San Diego by Sony
`Electronics employees located in San Diego. Docket No. 44-2 ¶¶ 4-5. Because San
`Diego is significantly closer to the Central District than the Northern District, this
`action should proceed here, not the Northern District. Amazon.com, 404 F. Supp.
`2d at 1260 (“The district court ought to be as close as possible to the milieu of the
`infringing device and the hub of activity centered around its production.”
`(emphasis added)). This factor therefore cuts against transfer.
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`3.3.4.
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`Remaining Jones factors
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`In addition to the factors identified supra, the Ninth Circuit has instructed
`courts to consider several other factors when determining whether to transfer venue
`under section 1404(a). Jones, 211 F.3d at 498-99. These factors include: (1) the
`state that is most familiar with the governing law; (2) the relevant public policy of
`the forum state; (3) the location where the relevant agreements were negotiated and
`executed; (4) the presence of a forum selection clause; (5) the availability of
`process to compel the attendance of third-party witnesses; and (6) ease of access to
`evidence. Id.
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`The parties do not spend much time addressing these factors, and, in any
`event, these factors are either neutral or do not apply here. First, regarding
`familiarity with governing law, the Northern District and the Central District are
`equally familiar with federal patent law.5 See Sorensen v. Phillips Plastics Corp.,
`2008 WL 4532556, at *4 (N.D. Cal. Oct. 9, 2008) (patent infringement case) (“The
`second factor (familiarity with the governing law) is inapplicable in a choice
`between two federal courts applying federal law.”). Second, regarding public
`policy, both districts are located in California, and neither district has local policy
`interests in deciding federal patent infringement claims. Lax v. Toyota Motor
`Corp., 65 F. Supp. 3d 772, 781 (N.D. Cal. 2014) (“There is no significant local
`interest in the controversy as between the Central and Northern Districts.”). Third
`and fourth, regarding agreements between the parties, Broadcom and the Sony
`Defendants have not entered into any agreements at issue in this case, let alone one
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`5 Indeed, both districts have Patent Pilot programs.
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`with a forum selection clause. Seely v. Cumberland Packing Corp., 2010 WL
`5300923, at *4 (N.D. Cal. Dec. 20, 2010) (false patent marking action) (“There is
`no contract at issue in this action. Thus, this factor is irrelevant to this analysis.”).
`Fifth, regarding subpoena power, the court’s subpoena power is relevant only if
`there are non-party witnesses who have refused or will refuse to testify in the
`action. Stanbury Elec. Eng’g, LLC v. Energy Prod., Inc., 2016 WL 3255003, at *7
`(W.D. Wash. June 13, 2016). Here, however, none of the parties has identified any
`non-party witnesses who have refused or will refuse to testify in this action. Sixth,
`and finally, regarding ease of access to evidence, this factor requires courts to
`consider whether any witness testimony or documentary evidence is more
`accessible in the transferee forum. Here, the Sony Defendants have not identified
`any documentary evidence that is more accessible in the Northern District,6 and
`instead argue only that more witnesses are located in the Northern District than the
`Central District. Docket No. 43-1 at 25. The Court addressed this argument supra,
`finding that this factor does not significantly favor transfer.
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`4.
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`Conclusion
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`The Sony Defendants have the burden of showing that transferring venue is
`appropriate here. To that end, Sony Defendants argued that the transferring venue
`is appropriate because the parties have a stronger relationship to the Northern
`District, and transferring venue would promote judicial economy and serve the
`convenience of non-party witnesses. For the reasons stated supra, the Court rejects
`these arguments, and determines that the Sony Defendants have failed to sustain
`their burden of showing that transfer is appropriate here. Accordingly, the Court
`declines to upset Broadcom’s choice of forum and denies the Sony Defendants’
`motion to transfer.
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`IT IS SO ORDERED.
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`6 Given the increasing prevalence of electronic discovery, particularly in complex civil
`litigation between large multinational corporations, this factor is often neutral in transfer
`analysis. Lax, 65 F. Supp. 3d at 780 (“[W]here electronic discovery is the norm (both for
`electronic information and digitized paper documents), ease of access is neutral given the
`portability of the information.”); Metz v. U.S. Life Ins. Co. in City of N.Y., 674 F. Supp. 2d
`1141, 1149 (C.D. Cal. 2009) (“[T]he ease of access to documents does not weigh heavily in the
`transfer analysis, given that advances in technology have made it easy for documents to be
`transferred to different locations.” (internal quotation marks omitted)).
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