Case 2:17-cv-00514-JRG Document 29-28 Filed 01/22/18 Page 1 of 8 PageID #: 412
`Case 2:17-cv—00514-JRG Document 29-28 Filed 01/22/18 Page 1 of 8 PageID #: 412
`
`
`
`EXHIBIT 25
`
`EXHIBIT 25
`
`

`

`Case 2:17-cv-00514-JRG Document 29-28 Filed 01/22/18 Page 2 of 8 PageID #: 413
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF DELAWARE
`
`3G LICENSING, S.A., KONINKLIJKE
`KPN N.V. and ORANGES.A.,
`
`Plaintiffs,
`
`v.
`
`Civil Action No. 17-83-LPS-CJB
`
`HTC CORPORATION and HTC -
`AMERICA INC.,
`
`Defendants.
`
`MEMORANDUM ORDER
`
`Pending before the Court is Defendants HTC Corporation ("HTC Corp.") and HTC
`
`America Inc.' s ("HTC America" and collectively with HTC Corp., "HTC" or "Defendants")
`
`motion to dismiss (1) both Defendants for improper venue, or, in the alternative, to transfer
`
`venue to the Western District of Washington; and (2) HTC Corp. for lack of personal jurisdiction
`
`(D.I. 21). Having considered the parties' motion briefing (D.I. 22, 28, 30) and letter briefing in
`
`response to the Court's September 11, 2017 Oral Order (D.I. 43, 50, 51, 54, 55), and for the
`
`reasons stated below, IT IS HEREBY ORDERED that Defendants' motion to dismiss (D.I. 21) is
`
`GRANTED-IN-PART and DENIED-IN-PART.
`
`The Venue Defense Is Not Untimely
`
`As an initial matter, Defendants' venue challenge is not untimely. As the Court of
`
`Appeals for the Federal Circuit recently held, "[t]he Supreme Court changed the controlling law
`
`
`
`when it decided TC Heartland[ 1] in May 2017." In re Micron Tech., Inc., 875 F.3d 1091, 1099
`
`(Fed. Cir. 2017). Therefore, "[t]he venue objection was not available until the Supreme Court
`
`1TC Heartland LLC v. Kraft Foods Grp. Brands LLC, 137 S. Ct. 1514 (2017).
`
`

`

`Case 2:17-cv-00514-JRG Document 29-28 Filed 01/22/18 Page 3 of 8 PageID #: 414
`
`decided TC Heartland because, before then, it would have been improper, given controlling
`
`precedent, for the district court to dismiss or to transfer for lack of venue." Id. at 1096.
`
`HTC America is Not a Delaware Resident for Purposes of Patent Venue
`
`Venue in a patent case for domestic corporations is governed exclusively by 28 U.S.C.
`
`§ 1400(b), TC Heartland, 137 S. Ct. at 1516, which provides: "[a]ny civil action for patent
`
`infringement may be brought in the judicial district where the defendant resides, or where the
`
`defendant has committed acts of infringement and has a regular and established place of
`
`business." For purposes of§ 1400(b), a defendant which is a domestic corporation "resides"
`
`· only in its state of incorporation. See TC Heartland, 137 S. Ct. at 1517. It is undisputed that
`
`HTC America-which is incorporated in Washington (D.I. 20 at~ 10)- does not "reside" in
`
`Delaware.
`
`Venue is Not Proper in Delaware for HTC America Under the Second Prong of§ 1400(b)
`
`Venue is proper in this District unless HTC America can show that the second prong of §
`
`1400(b) is not satisfied. See Boston Scientific Corp. v. Cook Group Inc.,_ F. Supp.3d _, 2017
`
`WL 3996110, at *4 (D. Del. Sept. 11, 2017) (holding that burden is on party opposing venue).
`
`With respect to the second prong's requirement that a defendant have committed "acts of
`
`infringement" in the District, it is undisputed that HTC America has sold and offered for sale its
`
`allegedly infringing products in Delaware. (See D.I. 22 at 3-5; D.I. 28 at 11) Therefore,
`
`Delaware is a proper venue for this lawsuit unless HTC America can meet its burden to show it
`
`does not have a regular and established place of business in Delaware. If HTC America can
`
`show that that is true, then venue here is improper as to it, and the Court will have to dismiss or
`
`transfer this case (at least as to HTC America).
`
`2
`
`

`

`Case 2:17-cv-00514-JRG Document 29-28 Filed 01/22/18 Page 4 of 8 PageID #: 415
`
`HTC America has met its burden - and, indeed, Plaintiffs no longer seriously dispute that
`
`Delaware is an improper venue as to HTC America. (See D.l. 50 at 2-3; D.I. 54 at 1) In HTC
`
`America's sworn declaration, it indicates that it has no physical location or facility in Delaware,
`
`and it has no employees located in Delaware. (D .I. 22 Ex. A at ifif 5-6) HTC America has shown
`
`that it does not have a regular and established place of business in this District. Thus, venue does
`
`not lie in Delaware for HTC America under the second prong of Section 1400(b ).
`
`HTC Corp. is a Foreign Defendant and May be Sued in Any Judicial District
`
`HTC Corp. is a foreign defendant; specifically, it is a Taiwanese corporation with its
`
`principal place of business in Taoyuan, Taiwan. -en.I. 20 at if 9) In Brunette Mach. Works., Ltd.
`
`v. Kockum Indus., Inc., 406 U.S. 706, 706-07 (1972), the Supreme Court held that when a foreign
`
`defendant is sued in a patent infringement action, the general venue provision, 28 U.S.C. § 1391,
`
`governs. Pursuant to§ 1391, a foreign defendant maybe sued in any judicial district. See 28
`
`U.S.C. § 1391(c)(3).
`
`Nevertheless, Defendants argue that "[:fJor policy reasons" in light of the TC Heartland
`
`decision, the Court should find that venue is improper in this District as to HTC Corp. (D.I. 22 at
`
`5-7; D.I. 55 at 1)2 But the TC Heartland Court made clear that-its holding did not address the
`
`applicability of Section 1400(b) to foreign defendants, and it explicitly stated that it did not
`
`2Defendants' argument is essentially that Brunette's holding "was unique to a situation
`where under the then existing statutory regime, no venue would have been proper." (D .I. 51 at 2)
`(internal quotation marks and emphasis omitted) In Defendants' view, due to statutory changes -
`as well as different circumstances, which here include that HTC America has a regular and
`established place of business in the State of Washington and "venue for HTC Corp. may be
`reasonably based on where venue is proper for HTC [America]," (D.I. 55 at l)-Brunette cannot
`be dispositive here. The Court, however, understands Brunette to remain binding precedent,
`which determines the outcome here.
`
`3
`
`

`

`Case 2:17-cv-00514-JRG Document 29-28 Filed 01/22/18 Page 5 of 8 PageID #: 416
`
`"express any opinion on" its holding in Brunette. 137 S. Ct. at 1520 n.2. Hence,
`
`Brunette remains good law, see, e.g., Red.com, Inc. v. Jinni Tech. Ltd., 2017 WL 4877414, at *7
`
`(C.D. Cal. Oct. 11, 2017), and, accordingly, venue is proper in this District as to HTC Corp.
`
`This Court May Exercise Personal Jurisdiction Over HTC Corp.
`
`In addition to arguing that venue is improper as to both HTC America and HTC Corp.,
`
`Defendants' motion also seeks dismissal of HTC Corp. pursuantto Federal Rule of Civil
`
`Procedure 12(b)(2), based on lack of personal jurisdiction. (D.I. 22 at 7-9) The Court concludes
`
`that this portion of Defendants' motion lacks merit.
`
`This Court may exercise personal jurisdiction over a foreign defendant pursuant to the
`
`"dual jurisdiction" or "stream of commerce" theory, where there is a showing: (1) of an intent to
`
`serve the Delaware market; (2) this intent results in the introduction of the product into the
`
`market; and (3) plaintiffs cause of action arises from injuries caused by that product. See
`
`Graphics Props. Holdings, Inc. v. ASUS Comput. Int'!, 70 F. Supp. 3d 654, 662 (D. Del. 2014);
`
`see also Polar Electro Oy v. Suunto Oy, 829 F.3d 1343, 1350 (Fed. Cir. 2016) (explaining that
`
`when defendant shipped numerous accused products to Delaware retailers, fully expecting that
`
`such products would thereafter be sold in Delaware, its actions were "purposefully directed to
`
`Delaware, indicating an intent and purpose to serve not only the U.S. market generally, but also
`
`the Delaware market specifically").
`
`The record here shows that these preconditions are satisfied. In its 2015 Annual Report,
`
`HTC Corp. stated it "maintains a presence in all key markets, including the United States" and its
`
`"products are distributed across . . . America[] . . . through major carriers and local retail
`
`channels." (D.I. 29 Ex. 1 at 34, 145) HTC Corp. further noted that it released particular
`
`4
`
`

`

`Case 2:17-cv-00514-JRG Document 29-28 Filed 01/22/18 Page 6 of 8 PageID #: 417
`
`smartphones in partnership with "US carrier Verizon." (Id. at 49) The record also shows that
`
`HTC Corp.' s intent to serve the United States market has resulted in the accused products being
`
`sold in Delaware, including at numerous Best Buy, Sprint, and Verizon locations. (Id. Exs. 3-7)
`
`HTC Corp's smartphones are also sold online through HTC America's website. (Id. Ex. 9)
`
`Defendants assert that the Supreme Court recently rejected the dual jurisdiction theory of
`
`personal jurisdiction, in Bristol-Myers Squibb Co. v. Superior Court of California, San
`
`Francisco County, 137 S. Ct. 1773 (2017). (D.I. 22 at 8-9; D.I. 30 at 8) The Court disagrees.
`
`Bristol-Myers Squibb involved a class action filed in a California state court by a large group of
`
`plaintiffs, most of whom did not reside in California, against a Delaware corporation based in
`
`New York, asserting injuries from defendant's drug product. See 137 S. Ct. at 1777-78. The
`
`California Supreme Court utilized a "sliding scale approach" to find that California courts had
`
`specific jurisdiction over the nonresidents' claims. Id. at 1778-79. In reversing the California
`
`Court, the Supreme Court emphasized that what is needed for specific jurisdiction - and what
`
`was missing in Bristol-Myers Squibb - "is a connection between the forum and the specific
`
`claims at issue." Id. at 1781-82. No such connection could be discerned where the nonresidents
`
`were not prescribed the drug at issue in California, did not buy it in California, did not ingest it
`
`there, and were not injured by the drug in California. Id.
`
`By contrast, here, the record shows that HTC Corp. intended to serve the Delaware
`
`market, and as a result, the accused products are being sold here, thereby allegedly causing
`
`damage to Plaintiffs. Thus, Defendants' argument based on Bristol-Myers Squibb is unavailing.
`
`Venue Proper as to One Defendant and Improper as to Second Defendant
`
`In light of the Court's conclusions above, venue is proper here as to HTC Corp. but
`
`5
`
`

`

`Case 2:17-cv-00514-JRG Document 29-28 Filed 01/22/18 Page 7 of 8 PageID #: 418
`
`improper as to HTC America. Defendants request that both Defendants be dismissed or
`
`transferred together to the Western District of Washington pursuant to 28-U.S.C. § 1406(a). (D.I.
`
`-22 at 9-11; D.I. 30 at 9; D.I. 55at1-2) Section 1406(a) instructs district courts that when a suit is
`
`I
`
`.
`
`filed in an improper venue, the court "shall dismiss, or if it be in the interest of justice, transfer
`
`such case to any district ... in which it could have been brought." Plaintiffs object to transfer of
`
`the entire case and, instead, request that the Court dismiss HTC America without prejudice and
`
`allow this case to proceed in Delaware against just HTC Corp. (D.I. 50 at 3; D.I. 54 at 2)
`
`Plaintiffs would then "forego pursuing any claims against [HTC America] during the pendency
`
`of this action." (D.I. 50 at 3)
`
`In the Court's view, an immediate transfer of the case as to both Defendants is not the
`
`most reasonable and appropriate outcome - particularly given Plaintiffs' objection, Plaintiffs'
`
`contingent request that its case against HTC America be dismissed, and the fact that ten other,
`
`related actions (involving at least one of the patents-in-suit in this case) are pending before the
`
`undersigned Judge. The Court is not (as yet) persuaded that it is in the interest of justice to
`
`burden a second District Court with patent infringement and invalidity disputes that overlap (if
`
`not entirely mirror) disputes this Court must (undisputedly) resolve in the related actions.
`
`Therefore, the Court will provide Plaintiffs an opportunity to dismiss their claims against HTC
`
`America (which they have not yet actually done) and will then permit HTC Corp. to renew its
`
`motion to transfer venue (and address the totality of relevant circumstances), or seek any other
`
`appropriate relief.
`
`Accordingly, .IT IS FURTHER ORDERED that:
`
`1..
`
`No later than December 2 7, 201 7, Plaintiffs shall, if they wish, dismiss HTC
`
`6
`
`

`

`Case 2:17-cv-00514-JRG Document 29-28 Filed 01/22/18 Page 8 of 8 PageID #: 419
`
`America, and file an amended complaint.
`
`. 2.
`
`No later than January 3, 2018, HTC Corp. and/or HTC America shall advise the
`
`Court, by motion or by letter, whether one or both of them seek transfer to the W estem District of
`
`Washington and/or any other relief.
`
`· December 18, 2017
`Wilmington, Delaware
`
`7
`
`