Case 1:10-cv-11530-RWZ Document 34 Filed 08/31/10 Page 1 of 12
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`10 Civ. 3952 (DLC)
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`OPINION & ORDER
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`X : : : : : : : : : : : X
`
`UNITED STATES DISTRICT COURT
`SOUTHERN DISTRICT OF NEW YORK
`----------------------------------------
`
`CIRREX SYSTEMS LLC,
`Plaintiff and
`Counterclaim-Defendant,
`
`-v-
`
`INFRAREDX, INC.,
`
`Defendant and
`Counterclaim-Plaintiff.
`
`----------------------------------------
`APPEARANCES
`
`For Plaintiff and Counterclaim-Defendant:
`
`Richard C. Pettus
`King & Spalding LLP
`1185 Avenue of the Americas
`New York, NY 10036
`
`For Defendant and Counterclaim-Plaintiff:
`
`Eric Seiler
`Hallie B. Levin
`Friedman Kaplan Seiler & Adelman LLP
`1633 Broadway
`New York, NY 10019
`
`Joseph Hynds
`Nancy Linck
`Jason Shapiro
`Rothwell, Figg, Ernst & Manbeck
`1425 K Street N.W. Suite 800
`Washington, DC 20005
`
`DENISE COTE, District Judge:
`
`
`
`This is a patent infringement action brought by plaintiff
`
`Cirrex Systems, LLC (“Cirrex”) against defendant IfraReDx, Inc.
`
`(“InfraReDx”). InfraReDx has moved pursuant to 28 U.S.C. §
`
`Page 1
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`
`
`10 Civ. 3952 (DLC)
`
`OPINION & ORDER
`
`X : : : : : : : : : : : X
`
`UNITED STATES DISTRICT COURT
`SOUTHERN DISTRICT OF NEW YORK
`----------------------------------------
`
`CIRREX SYSTEMS LLC,
`Plaintiff and
`Counterclaim-Defendant,
`
`-v-
`
`INFRAREDX, INC.,
`
`Defendant and
`Counterclaim-Plaintiff.
`
`----------------------------------------
`APPEARANCES
`
`For Plaintiff and Counterclaim-Defendant:
`
`Richard C. Pettus
`King & Spalding LLP
`1185 Avenue of the Americas
`New York, NY 10036
`
`For Defendant and Counterclaim-Plaintiff:
`
`Eric Seiler
`Hallie B. Levin
`Friedman Kaplan Seiler & Adelman LLP
`1633 Broadway
`New York, NY 10019
`
`Joseph Hynds
`Nancy Linck
`Jason Shapiro
`Rothwell, Figg, Ernst & Manbeck
`1425 K Street N.W. Suite 800
`Washington, DC 20005
`
`DENISE COTE, District Judge:
`
`
`
`This is a patent infringement action brought by plaintiff
`
`Cirrex Systems, LLC (“Cirrex”) against defendant IfraReDx, Inc.
`
`(“InfraReDx”). InfraReDx has moved pursuant to 28 U.S.C. §
`
`Page 1
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`
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`Case 1:10-cv-11530-RWZ Document 34 Filed 08/31/10 Page 2 of 12
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`1404(a) to transfer this action to the District of
`
`Massachusetts. For the following reasons, the motion is
`
`granted.
`
`BACKGROUND
`
`
`
`InfraReDx is a small medical device company incorporated in
`
`Delaware and located in Burlington, Massachusetts. InfraReDx
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`employs seventy-four employees, the vast majority of whom work
`
`at InfraReDx’s sole facility in Burlington. None of InfraReDx’s
`
`employees reside in New York. InfraReDx invented, developed,
`
`and now markets and sells a fiber-optic, catheter-based, near
`
`infrared spectroscopy system, called the LipiScan Coronary
`
`Imaging System (“LipiScan”). LipiScan is designed to analyze
`
`the composition of coronary lipid-rich plaques in patients
`
`undergoing catheterization. Such plaques are suspected to be
`
`the cause of most sudden cardiac deaths and non-fatal heart
`
`attacks. LipiScan is manufactured in Massachusetts and is
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`InfraReDx’s only commercial product. Substantially all
`
`invention, design, and development of LipiScan took place in
`
`Massachusetts. Sales of LipiScan to two New York-based
`
`customers accounted for 3.5% of InfraReDx’s revenue through
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`April 30, 2010.
`
`
`
`Cirrex is a small limited liability company located in
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`Alpharetta, Georgia. It has three principals and no other
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`2
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`Page 2
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`Case 1:10-cv-11530-RWZ Document 34 Filed 08/31/10 Page 3 of 12
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`employees. On May 12, 2010, Cirrex filed a complaint against
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`InfraReDx in the Southern District of New York, where Cirrex’s
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`counsel is located. The complaint alleges that LipiScan
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`infringes on United States Patent Nos. 6,366,726 (the “’726
`
`patent”), 5,953,477 (the “’477 patent”), and 6,144,791 (the
`
`“’791 patent”) (collectively, the “patents-in-suit”). Cirrex’s
`
`sole source of revenue is the licensing and enforcement of
`
`patents, including the patents-in-suit. The named inventors on
`
`the patents-in-suit are Michael Leonard Wach and Eric Todd
`
`Marple, who reside in Georgia and Florida, respectively. The
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`patents-in-suit were prosecuted by W. Scott Petty, a partner in
`
`the Atlanta office of plaintiff’s counsel, and Hubert J.
`
`Barnhardt III, who also has an office in Georgia. Cirrex has
`
`maintained documents concerning the patents-in-suit at its
`
`counsel’s New York office for over a year because of a prior
`
`lawsuit.
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`On July 6, 2010, InfraReDx moved to transfer this action to
`
`the District of Massachusetts pursuant to 28 U.S.C. § 1404(a).
`
`The motion was fully submitted on August 13.
`
`DISCUSSION
`
`
`
`The relevant law is well established. Section 1404
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`provides: “For the convenience of parties and witnesses, in the
`
`interest of justice, a district court may transfer any civil
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`3
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`Page 3
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`Case 1:10-cv-11530-RWZ Document 34 Filed 08/31/10 Page 4 of 12
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`action to any other district or division where it might have
`
`been brought.” 28 U.S.C. § 1404(a). District courts have
`
`“broad discretion in making determinations of convenience under
`
`Section 1404(a) and notions of convenience and fairness are
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`considered on a case-by-case basis.” D.H. Blair & Co., Inc. v.
`
`Gottdiener, 462 F.3d 95, 106 (2d Cir. 2006).1 The movant bears
`
`the burden of establishing, by “clear and convincing evidence,”
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`that a transfer of venue is warranted. N.Y. Marine & Gen. Ins.
`
`Co. v. Lafarge N. Am., Inc., 599 F.3d 102, 114 (2d Cir. 2010).
`
`
`
`If the transferee court would also have jurisdiction over
`
`the case, the court must determine whether, considering the
`
`“convenience of parties and witnesses” and the “interest of
`
`justice,” a transfer is appropriate. In making that
`
`determination, a court considers:
`
`(1) the plaintiff's choice of forum, (2) the
`convenience of witnesses, (3) the location of relevant
`documents and relative ease of access to sources of
`proof, (4) the convenience of parties, (5) the locus
`of operative facts, (6) the availability of process to
`compel the attendance of unwilling witnesses, and (7)
`the relative means of the parties.
`
`Id. at 112. A court may also consider “the forum’s familiarity
`
`with the governing law” and “trial efficiency and the interest
`
`1 The Federal Circuit has held that, in reviewing a ruling on a
`motion to transfer by a district court, it applies the law of
`the appropriate regional circuit because it is a procedural
`matter. See, e.g., Winner Int'l Royalty Corp. v. Wang, 202 F.3d
`1340, 1352 (Fed. Cir. 2000).
`
`4
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`Page 4
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`Case 1:10-cv-11530-RWZ Document 34 Filed 08/31/10 Page 5 of 12
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`of justice, based on the totality of the circumstances.” Berman
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`v. Informix Corp., 30 F. Supp. 2d 653, 657 (S.D.N.Y. 1998).
`
`
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`A transfer of venue is clearly warranted here. There is no
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`dispute that the District of Massachusetts would have
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`jurisdiction over this matter, or that venue properly lies
`
`there. Thus, only the “convenience of the parties and the
`
`witnesses” and the “interest of justice” need be considered.
`
`They compel transfer to Massachusetts.
`
`1. Convenience of the Witnesses
`
`
`
`Massachusetts is by far the more convenient forum for party
`
`and non-party witnesses. Resolution of this matter will require
`
`testimony concerning, among other things: (1) InfraReDx’s
`
`design and development of LipiScan; (2) IfraReDx’s sales,
`
`marketing, and financial information; and (3) the patents-in-
`
`suit. Virtually all of InfraReDx’s potential witnesses who may
`
`be knowledgeable about the first two categories are located or
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`work in Massachusetts.
`
`It would be inconvenient for these
`
`witnesses to have to travel hundreds of miles to New York.
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`Furthermore, those individuals who may be knowledgeable about
`
`the patents-in-suit –- the named inventors and the prosecuting
`
`attorneys –- are located in Georgia or Florida, not New York,
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`and will therefore have to travel regardless of whether this
`
`case is in New York or Massachusetts.
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`5
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`Page 5
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`Case 1:10-cv-11530-RWZ Document 34 Filed 08/31/10 Page 6 of 12
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`
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`As for additional potential third-party witnesses,
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`InfraReDx does not intend to call any witnesses located in New
`
`York.2 InfraReDx has identified only two potential third-party
`
`witnesses located outside Massachusetts, one of whom is in
`
`Texas, the other in Kentucky. For its part, Cirrex has
`
`identified four physicians at Mt. Sinai School of Medicine (“Mt.
`
`Sinai”) and Columbia University Medical Center (“Columbia”), who
`
`Cirrex describes as the “principal leaders” of InfraReDx’s
`
`clinical trials of LipiScan in New York. Three of these four
`
`New-York based third-party witnesses, however, are willing to
`
`testify in Massachusetts.3 Accordingly, this factor weighs in
`
`favor of transfer.
`
`2. Location of Relevant Documents
`
`
`
`“In patent infringement cases, the bulk of the relevant
`
`evidence usually comes from the accused infringer.
`
`Consequently, the place where the defendant’s documents are kept
`
`2 InfraReDx has customers located throughout the country,
`including two in New York. InfraReDx has indicated that it does
`not plan to call its customers and does not believe that they
`have information that is not available from other witnesses or
`evidence in Massachusetts.
`
`3 InfraReDx indicates that it has been unable to contact the
`fourth New-York-based physician, but believes that she would
`also be willing to testify in Massachusetts. InfraReDx further
`indicates that the testimony of this witness is likely to be
`redundant given that her colleague at Mt. Sinai is willing to
`testify in Massachusetts.
`
`6
`
`Page 6
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`
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`Case 1:10-cv-11530-RWZ Document 34 Filed 08/31/10 Page 7 of 12
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`weighs in favor of transfer to that location.” In re Genentech,
`
`Inc., 566 F.3d 1338, 1345 (Fed. Cir. 2009); see also Fuji Photo
`
`Film Co., Ltd. v. Lexar Media, Inc., 415 F. Supp. 2d 370, 374
`
`(S.D.N.Y. 2006).
`
`
`
`Like its witnesses, nearly all of InfraReDx’s documents,
`
`including those related to the development, design, testing,
`
`sales, marketing, advertising and finances of LipiScan, are
`
`located at InfraReDx’s sole office in Burlington, Massachusetts.
`
`Although a small percentage of InfraReDx’s sales are in New
`
`York, any documents relating to these sales are also available
`
`in Massachusetts. While technology has made shipping documents
`
`easier and less expensive, retaining this action in New York
`
`would still impose additional costs on InfraReDx that they would
`
`not incur if the case were transferred to Massachusetts.
`
`
`
`Moreover, Cirrex’s maintenance of documents concerning the
`
`patents-in-suit in its counsel’s New York office is insufficient
`
`to defeat transfer. See In re Hoffmann-La Roche Inc., 587 F.3d
`
`1333, 1337 (Fed. Cir. 2009); Children's Network, LLC v.
`
`Pixfusion LLC, No. 10 Civ. 2511(DLC), -- F. Supp. 2d --, 2010 WL
`
`2640120, at *4 (S.D.N.Y. June 30, 2010). In the normal course,
`
`Cirrex would have had to transfer its documents from Georgia to
`
`this district; the additional expense of shipping them to
`
`Massachusetts instead of New York is marginal. Accordingly,
`
`this factor weighs, however slightly, in favor of transfer.
`
`7
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`Page 7
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`Case 1:10-cv-11530-RWZ Document 34 Filed 08/31/10 Page 8 of 12
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`3. Convenience of Parties
`
`
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`Massachusetts, where substantially all of InfraReDx’s
`
`sources of evidence, i.e., its employees, other witnesses, and
`
`documents concerning LipiScan, are located, is by far the more
`
`convenient forum for InfraReDx. Maintaining this action in New
`
`York would be burdensome because it would require InfraReDx to
`
`travel away from these sources of evidence.
`
`
`
`In contrast, Cirrex is located in Georgia, not New York,
`
`and has identified no witnesses in New York who would not be
`
`willing to travel to Massachusetts to testify. Transferring
`
`this case to Massachusetts will not materially disadvantage
`
`Cirrex because it will already have to travel from Georgia to
`
`New York. Further, any inconvenience to Cirrex’s New York-based
`
`counsel is irrelevant. Accordingly, this factor weighs in favor
`
`of transfer.
`
`4. Locus of Operative Facts
`
`
`
`In patent cases, the locus of operative facts usually lies
`
`where either the patent-in-suit or the allegedly infringing
`
`product was designed, developed, and produced. See, e.g.,
`
`Children’s Network, 2010 WL 2640120, at *7; TouchTunes Music
`
`Corp. v. Rowe Int'l Corp., 676 F. Supp. 2d 169, 175 (S.D.N.Y.
`
`2009); Fuji Photo Film, 415 F. Supp. 2d at 375. Here, none of
`
`the critical events took place in New York.
`
`8
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`Page 8
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`
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`Case 1:10-cv-11530-RWZ Document 34 Filed 08/31/10 Page 9 of 12
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`
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`InfraReDx designed, developed, and manufactures LipiScan in
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`Massachusetts. Further, substantially all of the inventors,
`
`designers, developers, and manufacturers –- some of whom no
`
`longer work for InfraReDx –- are located or work in
`
`Massachusetts. The patents-in-suit, whose inventors are in
`
`Georgia and Florida, have no connection whatsoever to New York.
`
`That Cirrex’s counsel has retained documents concerning the
`
`patents-in-suit in New York because of prior litigation does not
`
`alter this fact.
`
`
`
`Cirrex argues that this district is “a relevant locus of
`
`operative facts” because clinical trials and sales of LipiScan
`
`occurred in this district, and because InfraReDx has directed
`
`marketing activities in and toward this district. Specifically,
`
`Cirrex points to clinical trials of LipiScan conducted at Mt.
`
`Sinai and Columbia; InfraReDx’s demonstration of LipiScan and
`
`promotional activities at the “CCC Symposium” for cardiologists
`
`held in New York; and InfraReDx’s sales of LipiScan in New York.
`
`
`
`Such minimal contacts are insufficient to render New York
`
`the locus of operative facts for venue purposes. See, e.g.,
`
`Fuji Photo Film, 415 F. Supp. 2d at 375. First, InfraReDx
`
`conducts clinical trials throughout the country; New York
`
`patients account for less than 10% of all trial participants.
`
`Further, the vast majority of clinical trials are managed, at
`
`least in part, by InfraReDx in Massachusetts. Second, InfraReDx
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`9
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`Page 9
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`Case 1:10-cv-11530-RWZ Document 34 Filed 08/31/10 Page 10 of 12
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`attends conferences throughout the country; its attendance at a
`
`single symposium establishes at best a minor connection to this
`
`district. Lastly, LipiScan sales to New York customers account
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`for only 3.5% of InfraReDx’s revenues. None of these
`
`activities, alone or together, is sufficient to warrant
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`retention of this action in New York. Accordingly, this factor
`
`weighs in favor of transfer.
`
`5. Availability of Compulsory Process
`
`
`
`If needed, compulsory process for the vast majority of the
`
`potential third-party witnesses identified by InfraReDx, who are
`
`located in Massachusetts, would not be available if this action
`
`were retained in New York. The other third-party witnesses
`
`identified by InfraReDx, while not in Massachusetts, are also
`
`not in New York. Likewise, Cirrex’s representatives, as well as
`
`the named inventors of the patents-in-suit and the prosecuting
`
`attorneys, are also not in New York. Furthermore, three of the
`
`four third-party witnesses identified by Cirrex who are in New
`
`York -– the physicians who conducted clinical trials at Mt.
`
`Sinai and Columbia –- have stated that they are willing to
`
`testify in Massachusetts. Thus, the availability of compulsory
`
`process in New York is irrelevant.
`
`
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`10
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`Page 10
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`Case 1:10-cv-11530-RWZ Document 34 Filed 08/31/10 Page 11 of 12
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`6. Relative Means of the Parties
`
`
`
`The relative means of the parties is not generally a factor
`
`in suits involving corporations. Cirrex and InfraReDx are both
`
`small companies. Accordingly, this factor is neutral.
`
`7. Familiarity with Governing Law and Trial Efficiency
`
`
`
`Both this district and the transferee district are equally
`
`familiar with patent law. Furthermore, despite the parties’
`
`contentions, both districts are equally capable of fairly and
`
`efficiently adjudicating this dispute in accordance with the
`
`governing law. Accordingly, these factors are neutral.
`
`
`
`8. Plaintiff’s Choice of Forum
`
`
`
`A plaintiff’s choice of forum is ordinarily “a decision
`
`that is given great weight.” D.H. Blair, 462 F.3d at 107. “The
`
`plaintiff’s choice is entitled to less deference, however, where
`
`the forum is not the plaintiff’s home and the cause of action
`
`did not arise in the forum.” Children’s Network, 2010 WL
`
`2640120, at *5 (citation omitted); see also Fuji Photo Film, 415
`
`F. Supp. 2d at 376; Berman, 30 F. Supp. 2d at 659.
`
`
`
`Here, the balance of conveniences weighs strongly in favor
`
`of transfer and far outweighs any deference given to Cirrex’s
`
`choice of forum. This action has, at best, a tenuous connection
`
`to this district. New York is not Cirrex’s home district; the
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`11
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`Page 11
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`Case 1:10-cv-11530-RWZ Document 34 Filed 08/31/10 Page 12 of 12
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`Page 12
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