Case 2:19-cv-00209-JRG Document 52 Filed 09/27/19 Page 1 of 20 PageID #: 2387
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`MARSHALL DIVISION
`
`
`
`Plaintiff,
`
`v.
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`THE HILLMAN GROUP, INC.,
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`
`
`
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`KEYME, LLC,
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`
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`Defendant.
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`
`
` Civil Action No. 2:19-cv-00209-JRG
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`JURY TRIAL DEMANDED
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`)
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`))
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`))))))))
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`HILLMAN’S OPPOSITION TO KEYME, LLC’S MOTION TO TRANSFER VENUE TO
`THE SOUTHERN DISTRICT OF NEW YORK UNDER 28 U.S.C. § 1404
`
`
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`

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`Case 2:19-cv-00209-JRG Document 52 Filed 09/27/19 Page 2 of 20 PageID #: 2388
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`
`
`TABLE OF CONTENTS
`
`I.
`
`SUMMARY ........................................................................................................................ 1
`
`II. FACTUAL BACKGROUND ............................................................................................. 2
`
`A.
`
`B.
`
`C.
`
`Hillman Has a Significant Presence in the Eastern District .................................... 2
`
`Hillman’s Inventors Are All in California and Arizona, Closer to Texas than New
`York ........................................................................................................................ 3
`
`KeyMe Has a Minimal Presence in New York, and Its Kiosks Are Nationwide,
`Including This District ............................................................................................ 4
`
`III.
`
`LAW AND ARGUMENT .................................................................................................. 5
`
`
`
`
`
`A.
`
`B.
`
`Legal Standard ........................................................................................................ 5
`
`Neither the Private Nor Public Interest Factors Favor Transfer to New York ....... 6
`
`1.
`
`No Private Interest Factor Weighs in Favor of Transfer to New York ....... 6
`
`a.
`
`b.
`
`c.
`
`The Location of Sources of Proof Favors Keeping the Case in
`Texas ............................................................................................... 6
`
`KeyMe Concedes the Second Private Factor is Neutral ................. 8
`
`Cost of Attendance for Willing Witnesses Does Not Favor
`Transfer ........................................................................................... 9
`
` d.
`
`Practical Problems Do Not Apply in this Case ............................. 11
`
`2.
`
`No Public Interest Factor Weighs in Favor of Transfer to New York ...... 12
`
`a.
`
`b.
`
`c.
`
`Court Congestion Favors Keeping the Case in Marshall .............. 12
`
`The Local Interests are Neutral ..................................................... 13
`
`Hillman’s Pending Motion to Disqualify Favors Keeping this Case
`in Texas ......................................................................................... 14
`
`IV. CONCLUSION ................................................................................................................. 15
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`
`ii
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`Case 2:19-cv-00209-JRG Document 52 Filed 09/27/19 Page 3 of 20 PageID #: 2389
`
`TABLE OF AUTHORITIES
`
`Federal Cases
`
`Affinity Labs of Tex. v. Samsung Elecs. Co., Ltd.,
`968 F. Supp. 2d 852 (E.D. Tex. 2013) .....................................................................................13
`
`In re Am. Airlines, Inc.,
`972 F.2d 605 (5th Cir. 1992) ...................................................................................................14
`
`C&J Spec Rent Servs., Inc. v. LEAM Drilling Sys., LLC,
`No. 2:19-CV-00079-JRG-RSP, 2019 WL 3017379 (E.D. Tex. July 10, 2019) ........................7
`
`Cypress Lake Software, Inc. v. HP Inc.,
`No. 6:17-CV-00462-RWS, 2018 WL 4100767 (E.D. Tex. June 27, 2018)...............................7
`
`Diem LLC v. BigCommerce, Inc.,
`No. 6:17-CV-00186-JRG, 2017 WL 6729907 (E.D. Tex. Dec. 28, 2017) ................................7
`
`In re Genentech, Inc.,
`566 F.3d 1338 (Fed. Cir. 2009)............................................................................................9, 12
`
`Godo Kaisha IP Bridge 1 v. Intel Corp.,
`No. 2:17-CV-00676-RWS-RSP, 2018 WL 5728524 (E.D. Tex. Aug. 29, 2018) ................9, 10
`
`In re Hoffman-La Roche Inc.,
`587 F.3d 1333 (Fed. Cir. 2009)................................................................................................13
`
`Invitrogen Corp. v. Gen. Elec. Co.,
`No. 6:08-CV-112, 2009 WL 331891 (E.D. Tex. Feb. 9, 2009) ...............................................12
`
`Kranos IP Corp. v. Riddell, Inc.,
`No. 2:17-CV-443-JRG, 2017 WL 370462 (E.D. Tex. Aug. 28, 2017)......................................6
`
`Luminati Networks Ltd. v. BIScience Inc.,
`No. 2:18-CV-00483-JRG, 2019 WL 2084426 (E.D. Tex. May 13, 2019) ..............................12
`
`Lyondell Chem. Co. v. Albemarle Corp.,
`No. 1:01-CV-890, 2004 WL 7332836 (E.D. Tex. Feb. 23, 2004) ...........................................15
`
`Neil Bros. Ltd. v. World Wide Lines, Inc.,
`425 F. Supp. 2d 325 (E.D.N.Y. 2006) .......................................................................................9
`
`Peloton Interactive, Inc. v. Flywheel Sports, Inc.,
`No. 2:18-CV-00390-RWS-RSP, 2019 WL 2303034 (E.D. Tex. May 30, 2019) ....................13
`
`Seven Networks, LLC v. Google LLC,
`No. 2:17-CV-00442-JRG, 2018 WL 4026760 (E.D. Tex. Aug. 15, 2018)....................9, 11, 12
`
`iii
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`

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`Case 2:19-cv-00209-JRG Document 52 Filed 09/27/19 Page 4 of 20 PageID #: 2390
`
`Smith v. Real Page, Inc.,
`No. 4:18-CV-00025, 2018 WL 3105758 (E.D. Tex. June 25, 2018) ....................................6, 7
`
`Traxxas, L.P. v. Hobbico, Inc.,
`No. 2:16-CV-00768-JRG-RSP, 2017 WL 9935517 (E.D. Tex. Aug. 21, 2017) .....................11
`
`In re TS Tech USA Corp.,
`551 F.3d 1315 (Fed. Cir. 2008)..............................................................................11, 12, 13, 14
`
`Van Dusen v. Barrack,
`376 U.S. 612 (1964) ...................................................................................................................9
`
`Va. Innovation Scis., Inc. v. Amazon.com, Inc.,
`No. 4:18-CV-474, 2019 WL 3082314 (E.D. Tex. July 15, 2019) .................................6, 11, 12
`
`In re Volkswagen AG,
`371 F.3d 201 (5th Cir. 2004) (per curiam).....................................................................6, 11, 13
`
`In re Volkswagen of Am., Inc.,
`545 F.3d 304 (5th Cir. 2008) ........................................................................................... passim
`
`Wahlstrom v. B & A Carrier LLC,
`No. 2:18-CV-00313-JRG, 2019 WL 130296 (E.D. Tex. Jan. 8, 2019) .....................................6
`
`Woods v. Covington Cnty. Bank,
`537 F.2d 804 (5th Cir. 1976) ...................................................................................................14
`
`Federal Statutes
`
`28 U.S.C. § 1404(a) ...........................................................................................................5, 6, 8, 11
`
`Rules and Regulations
`
`E.D. TEX. L.R. AT-2 ......................................................................................................................15
`
`TEX. DISCIPLINARY R. PROF. CONDUCT (2019)........................................................................14, 15
`
`UNITED STATES DIST. CT. FOR THE EASTERN DIST. OF TEX. LOCAL RULES (2019) .......................15
`
`
`
`
`
`
`
`iv
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`Case 2:19-cv-00209-JRG Document 52 Filed 09/27/19 Page 5 of 20 PageID #: 2391
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`I.
`
`SUMMARY
`
`KeyMe urges this Court to transfer this case from the Eastern District of Texas to the
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`Southern District of New York on the mistaken premise that New York is a “clearly more
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`convenient” forum. But that conclusory statement is based on mistakes of both law and fact.
`
`To begin with, KeyMe’s Motion gets the facts wrong. KeyMe states that Hillman’s key
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`duplication operations are run from Ohio and Arizona, but ignores multiple other Hillman facilities
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`contributing to the key duplication business. KeyMe is also wrong that Hillman’s connections to
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`this District “do not relate to Hillman’s key duplication kiosks,” given Hillman’s 165,705 square
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`foot Lewisville distribution facility that is critical to Hillman’s key duplication business, as well
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`as the more than 100 Hillman key duplication machines deployed within the District.
`
`KeyMe fares no better in its legal analysis. KeyMe must show that a majority of public
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`and private interest factors weigh in favor of transfer. But in reality, not a single factor favors
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`KeyMe, in part because KeyMe often misstates the proper tests, such as witness convenience and
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`time to trial in each district. KeyMe has not demonstrated that the Southern District of New York
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`is a clearly more convenient venue for this litigation.
`
`
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`This Court will conduct a Scheduling Conference with the parties on October 15, 2019,
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`less than a week after briefing on this Motion will be completed, and will set a trial date. Moreover,
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`this Court has already granted Hillman leave to amend its Complaint to add a third, newly-issued
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`patent. Indeed, Hillman has already served its infringement contentions for the three patents-in-
`
`suit (see D.I. 36). This Court has history and familiarity with this case, and a transfer to New York
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`means starting over. KeyMe’s Motion to Transfer should be denied.
`
`
`
`1
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`

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`Case 2:19-cv-00209-JRG Document 52 Filed 09/27/19 Page 6 of 20 PageID #: 2392
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`II. FACTUAL BACKGROUND
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`
`
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`A.
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`Hillman Has a Significant Presence in the Eastern District
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`Contrary to KeyMe’s incorrect and unsupported assertions in its Motion, the Eastern
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`District of Texas is vital to Hillman’s key duplication operations. Hillman maintains a distribution
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`facility in Lewisville, Texas, located in Denton County within the Eastern District. Hillman
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`assumed operations at its present 165,705 square foot Lewisville distribution center
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`
`
`17:11-20:24; see also Ex. C at 10-11 (
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` See Ex. B (Kitzberger Tr.) at
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`
`
`). More than
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` products relating to
`
`Hillman’s key duplication business (and nearly
`
` total products) moved through the
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`Lewisville facility in the twelve months ending in August, 2019, representing
`
`
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` in eventual sales. See Ex. C at 11 (
`
`); D.I. 30 at
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`¶ 13. KeyMe’s Motion makes no mention of the Lewisville facility,1 and summarily concludes
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`incorrectly that no Texas facilities involve Hillman’s key duplication operations.2
`
`
`1 KeyMe misreads Hillman’s SEC 10-K form as presenting “three total facilities within Texas,
`only two of which are in the Eastern District.” (D.I. 14 at 3.) The Lewisville facility within the
`Eastern District is named as the “Dallas, Texas” facility in Item 2 of the 10-K. (D.I. 14-2 at 15.)
`This is common shorthand internally at Hillman (see Ex. B at 10), since the Lewisville facility is
`less than ten miles from Dallas-Fort Worth International Airport. The 10-K also clearly notes that
`there are two facilities in Tyler, Texas, which are also within the Eastern District. (D.I. 14-2 at
`15.) Finally, there is a fourth Texas facility listed in Item 2: an office and distribution facility
`located in San Antonio, Texas. (Id.)
`
`2 KeyMe’s scattershot arguments regarding a Southern District of Ohio litigation between Hillman
`and Minute Key Inc. not mentioning “employees in Texas” are irrelevant. (D.I. 14 at 3.) First,
`that litigation involved different issues and different causes of action. Just because Hillman chose
`not to name any Texas-based employee as a potential trial witness does not mean those employees
`and those facilities do not exist. Moreover, initial disclosures from that case are from 2014, three
`years before Hillman opened its expanded Lewisville distribution center. Similarly, KeyMe’s
`citation to a Hillman subsidiary holding company allegedly “located in New York, New York” is
`
`2
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`
`

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`Case 2:19-cv-00209-JRG Document 52 Filed 09/27/19 Page 7 of 20 PageID #: 2393
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`
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`Totaling the three facilities within the Eastern District of Texas (the Lewisville facility and
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`the two Tyler facilities), Hillman employs nearly
`
` people in the Eastern District, in addition to
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`the employees that work remotely who service the more than 100 Hillman FastKey, Minute Key,
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`and KeyKrafter key duplication machines located within the District. See Ex. B (Kitzberger Tr.)
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`at 65:5-8
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`”); Ex. C at 10-14 (
`
`
`
`
`
`
`
`
`
`). These employees and operations generate
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`business annually for Hillman, and also provide substantial monetary benefit to the local economy
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`of the Eastern District via payment of rent, taxes, utilities, and contracts for services. See Ex. C at
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`13-14. The Eastern District is vital to Hillman’s overall business, and to its key duplication
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`business in particular. See id. at 25-26.
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`B.
`
`Hillman’s Inventors Are All in California and Arizona, Closer to Texas than
`New York
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`
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`Hillman is currently asserting three patents in this litigation against KeyMe, with a total of
`
`six inventors.3 (See D.I. 30-1 at 1; D.I. 30-2 at 1; D.I. 30-3 at 1.) In addition to participating in
`
`Hillman intellectual property procurement, each of the inventors was involved in research, design,
`
`and development of the Hillman covered products, and related technology. Two of the inventors,
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`brothers Daniel Freeman and Ari Freeman, are located in Southern and Northern California,
`
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`equally irrelevant to the present Motion. KeyMe has not identified any witnesses or documents
`relevant to this case that are in the possession of that non-party.
`
`3 Hillman amended its initial Complaint on September 3, 2019 (D.I. 29; D.I. 30), after KeyMe’s
`Motion was filed on July 25, 2019, to add newly-issued U.S. Patent No. 10,400,474 (D.I. 30-3.)
`KeyMe has not updated or re-filed this Motion in view of the Amended Complaint, so there is no
`venue analysis whatsoever in KeyMe’s Motion pertaining to the new ’474 patent or any relevant
`documents or witnesses.
`
`3
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`
`

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`Case 2:19-cv-00209-JRG Document 52 Filed 09/27/19 Page 8 of 20 PageID #: 2394
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`respectively. (See D.I. 30-2 at 1 (listing Daniel Freeman as residing in Calabasas, CA and Ari
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`Freeman as residing in San Rafael, CA.)) The remaining four inventors each reside in the Phoenix,
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`Arizona metropolitan area. (See D.I. 30-3 at 1 (listing inventor residences in Phoenix, Chandler,
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`and Gilbert, AZ.)) KeyMe notes only that the Freeman brothers do not “reside in this District,”
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`(D.I. 14 at 4) but the Freeman brothers do not reside in the Southern District of New York, either.
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`Marshall, Texas is approximately 1,000 miles closer to San Rafael, California than New York City
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`(Ex. A (O’Quinn Decl.) at ¶ 1; Ex. D) and approximately 1,100 miles closer to Calabasas,
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`California. Ex. A (O’Quinn Decl.) at ¶ 2; Ex. E. The inventors of the ’474 patent-in-suit all reside
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`in the Phoenix area, which is 1,200 miles closer to Marshall than to New York City. Ex. A
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`(O’Quinn Decl.) at ¶ 3; Ex. F.
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`C.
`
`KeyMe Has a Minimal Presence in New York, and Its Kiosks Are Nationwide,
`Including This District
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`
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`KeyMe’s Motion makes much of the number of people it employs in New York City,
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`within the Southern District of New York. Upon closer inspection, however, only approximately
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`60 KeyMe employees are actually located at KeyMe’s New York headquarters. (D.I. 41-2 at ¶ 5
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`(“Approximately 60 KeyMe employees work in this [New York] office, which constitutes a
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`majority of KeyMe’s approximately 100 employees.”)) Put in perspective, this means that Hillman
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`employs
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` more people in the Eastern District of Texas than KeyMe employs in the
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`Southern District of New York. See § II.A, supra. KeyMe’s much-touted New York presence is
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`actually relatively minimal, especially compared to Hillman’s presence in this District.
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`
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`By KeyMe’s own admission, a more relevant measure of KeyMe’s geographic footprint is
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`the location of its “KeyMe” and “Locksmith in a Box” kiosks, and related services sold via those
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`kiosks. (See D.I. 41-2 at ¶ 6 (KeyMe declarant and CEO Greg Marsh asserting that “KeyMe’s
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`business focuses entirely on key duplication and locksmith services.”)) KeyMe’s “approximately
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`4
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`

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`Case 2:19-cv-00209-JRG Document 52 Filed 09/27/19 Page 9 of 20 PageID #: 2395
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`2,500 key duplication kiosks” are located “across the United States,” not just in New York. Indeed,
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`approximately 30 of those kiosks are currently in operation and doing business in the Eastern
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`District of Texas. See id. at ¶ 12; see also Ex. G (Abbott Tr.) at 103:22-25 (KeyMe CFO Jimmy
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`Abbott testifying that
`
`
`
`”).
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`While KeyMe attempts to minimize its business and presence in the Eastern District of
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`Texas, it has reaped nearly
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` of revenue from its kiosk and locksmith businesses in the
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`District in just the last two years, via more than
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` unique orders received from customers
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`within the Eastern District. See Ex. H (
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`); Ex. J (
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`); Ex. I (
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`); see also Ex. G (Abbott Tr.) at 66:12-69:1 (explaining Ex. H), 73:6-74:8 (explaining Ex. I),
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`75:14-77:20 (explaining Ex. J).
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`III. LAW AND ARGUMENT
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`Legal Standard
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`A.
`To transfer this case pursuant to §1404(a), KeyMe has the burden to show “good cause”
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`that a transfer is in the interest of justice, which means KeyMe must prove that the Southern
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`District of New York is “clearly more convenient” than the Eastern District of Texas. See In re
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`Volkswagen of Am., Inc., 545 F.3d 304, 315 (5th Cir. 2008) (emphasis added) (“Volkswagen II”).
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`Absent such a showing, the plaintiff’s choice of venue “is to be respected” and should not be
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`disturbed. Kranos IP Corp. v. Riddell, Inc., No. 2:17-CV-443-JRG, 2017 WL 3704762, at *10
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`5
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`

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`Case 2:19-cv-00209-JRG Document 52 Filed 09/27/19 Page 10 of 20 PageID #: 2396
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`(E.D. Tex. Aug. 28, 2017) (citing Volkswagen II, 545 F.3d at 315). When deciding a motion to
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`transfer under § 1404(a), a court may consider undisputed facts outside of the pleadings such as
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`affidavits or declarations, but it must draw all reasonable inferences and resolve factual conflicts
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`in favor of the non-moving party. See, e.g., Wahlstrom v. B & A Carrier LLC, No. 2:18-CV-
`
`00313-JRG, 2019 WL 130296, at *2 (E.D. Tex. Jan. 8, 2019).
`
`KeyMe has failed to meet its burden to show that a transfer to the Southern District of New
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`York is warranted. Hillman does not dispute that this action “could have been brought” in the
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`Southern District of New York, as that district is the location of KeyMe’s headquarters.
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`Transferring this case to New York, however, must also advance the “interests of justice.” For the
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`foregoing reasons, the interests of justice favor retaining this action in Texas.
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`Neither the Private Nor Public Interest Factors Favor Transfer to New York
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`B.
`KeyMe’s cursory discussion in its Motion of several private and public interest factors fails
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`to satisfy its heavy burden. In fact, more careful analysis reveals that the cited factors (plus others
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`that KeyMe does not address) favor maintaining this action in the Eastern District of Texas.
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`1. No Private Interest Factor Weighs in Favor of Transfer to New York
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`a. The Location of Sources of Proof Favors Keeping the Case in Texas
`The first private interest factor is “the relative ease of access to the sources of proof.” Va.
`
`
`
`Innovation Scis., Inc. v. Amazon.com, Inc., No. 4:18-CV-474, 2019 WL 3082314, at *12 (E.D.
`
`Tex. July 15, 2019) (citing In re Volkswagen AG, 371 F.3d 201, 203 (5th Cir. 2004) (per curiam)
`
`(“Volkswagen I”). The location of documentary and physical evidence “is given little weight in
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`determining proper venue unless the documents are so voluminous [that] their transport is a major
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`undertaking.” Smith v. Real Page, Inc., No. 4:18-CV-00025, 2018 WL 3105758, at *5 (E.D. Tex.
`
`June 25, 2018) (internal quotation marks omitted). Indeed, “[t]echnology has lessened the
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`inconvenience of gaining access to some sources of proof.” C&J Spec Rent Servs., Inc. v. LEAM
`
`6
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`
`

`

`Case 2:19-cv-00209-JRG Document 52 Filed 09/27/19 Page 11 of 20 PageID #: 2397
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`Drilling Sys., LLC, No. 2:19-CV-00079-JRG-RSP, 2019 WL 3017379, at *5 (E.D. Tex. July 10,
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`2019) (citing Volkswagen II, 545 F.3d at 316). Nevertheless, this factor is not superfluous and
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`must be considered. Volkswagen II, 545 F.3d at 316.
`
`
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`KeyMe summarily alleges that broad categories of documents and things such as “technical
`
`documentation,” “source code, prototypes, research and development documents, analytics
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`documents, data, engineering documents, documentation regarding KeyMe’s intellectual property,
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`company records, marketing records, financial records, sales records, human resources
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`documentation, and documents regarding legal activities” are located in New York. (D.I. 14 at 6.)
`
`But this Court and others have repeatedly held that “[t]o meet its burden, Defendants must identify
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`their sources of proof with some specificity such that the Court may determine whether transfer
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`will increase the convenience of the parties.” Diem LLC v. BigCommerce, Inc., No. 6:17-CV-
`
`00186-JRG, 2017 WL 6729907, at *2 (E.D. Tex. Dec. 28, 2017); see also Cypress Lake Software,
`
`Inc. v. HP Inc., No. 6:17-CV-00462-RWS, 2018 WL 4100767, at *3 (E.D. Tex. June 27, 2018)
`
`(noting “failure to identify these documents with any specificity beyond their general categories.”).
`
`Indeed, KeyMe’s corporate representative
`
`
`
`also Ex. J (
`
`. See Ex. F (Abbott Tr.) at 81:11-82:15; see
`
`
`
`). KeyMe has provided no indication that access to its documents for trial will be a
`
`“major undertaking” in Texas compared to New York.
`
`Moreover, KeyMe’s analysis assumes that all documents from Hillman will come from its
`
`headquarters in Ohio. In actuality, technical documents relating to the Hillman key duplication
`
`machines covered by the patents-in-suit, and financial documents are located at Hillman’s offices
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`and manufacturing facilities in Colorado and Arizona, both of which are significantly closer to
`
`7
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`

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`Case 2:19-cv-00209-JRG Document 52 Filed 09/27/19 Page 12 of 20 PageID #: 2398
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`Marshall than to New York City. See, e.g., Ex. B (Kitzberger Tr.) at 45:13-46:11; Ex. C at 14-17
`
`(
`
`).
`
`KeyMe incorrectly states that Hillman’s key duplication business “has no connection with
`
`Texas.” (D.I. 14 at 7.) To the contrary, as discussed above, Hillman’s Lewisville facility in the
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`Eastern District processes and distributes
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` Hillman key duplication-related products that
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`generate
`
` dollars in sales annually. Documents related to that business are
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`accessible at Hillman’s Lewisville facility, and elsewhere, such as at Hillman’s facilities in Ohio,
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`Colorado, and Arizona.
`
`
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`KeyMe also ignores the location of documents from third parties in its analysis that may
`
`be relevant to the case. For example, KeyMe’s kiosks
`
`(see Ex. L,
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` Ex. G (Abbott Tr.) at 27:9-19), so documents relevant to
`
`
`
`
`
`
`
`in
`
`(
`
` may be located there, or at Texas corporation
`
`headquarters
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`, less than 100 miles from the Eastern District. See Ex. L at KEYME-000032
`
`
`
`).
`
`KeyMe has not identified a single evidentiary document or thing that would become more
`
`available if the case were transferred to New York. Section 1404(a) permits only transfer “to a
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`more convenient forum, not a forum likely to prove equally convenient or inconvenient.” Van
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`Dusen v. Barrack, 376 U.S. 612, 645-46 (1964). This factor is at best neutral and, based on the
`
`current record, actually favors keeping the case in Texas.
`
`b. KeyMe Concedes the Second Private Factor is Neutral
`The second private interest factor is “the availability of compulsory process to secure the
`
`
`
`attendance of witnesses.” Volkswagen II, 545 F.3d at 316. KeyMe concedes that this factor is
`
`8
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`

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`Case 2:19-cv-00209-JRG Document 52 Filed 09/27/19 Page 13 of 20 PageID #: 2399
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`neutral because it is unaware of any unwilling non-party witnesses within the subpoena power of
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`either this Court or the Southern District of New York. (D.I. 14 at 9.) Hillman agrees.
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`c. Cost of Attendance for Willing Witnesses Does Not Favor Transfer
`The third private interest factor is “the cost of attendance for willing witnesses.”
`
`Volkswagen II, 545 F.3d at 317. “The convenience of the witnesses is probably the single most
`
`important factor in a transfer analysis.” In re Genentech, Inc., 566 F.3d 1338, 1343 (Fed. Cir. 2009)
`
`(quoting Neil Bros. Ltd. v. World Wide Lines, Inc., 425 F. Supp. 2d 325, 329 (E.D.N.Y. 2006)).
`
`KeyMe summarily declares that because New York “is far more convenient for the potential party
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`witnesses,” this factor “weighs heavily in favor of transfer.” (D.I. 14 at 7.) KeyMe misreads the
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`law, as this Court and many others have held that “the convenience of party witnesses is given
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`little weight.” Seven Networks, LLC v. Google LLC, No. 2:17-cv-00442-JRG, 2018 WL 4026760,
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`at *9 (E.D. Tex. Aug. 15, 2018). Moreover, KeyMe has not identified with specificity in its Motion
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`or in any attached declarations any of the alleged 100 KeyMe employees for whom New York
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`would be more convenient; indeed, the only employees identified at all are CEO Greg Marsh and
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`CFO Jimmy Abbott. (See D.I. 41-2 at ¶ 6.) Nor has KeyMe identified which, if any, of its
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`employees that it plans to call as witnesses as trial, which further limits the relevance of its blanket
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`statements regarding convenience. See, e.g., Godo Kaisha IP Bridge 1 v. Intel Corp., No. 2:17-
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`CV-00676-RWS-RSP, 2018 WL 5728524, at *6 (E.D. Tex. Aug. 29, 2018) (“[T]he Court finds it
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`unlikely [Defendant] will call such a large number of its employees at trial given the cumulative
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`nature of their testimony.”).
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`KeyMe mistakenly assumes, with no support, that “Hillman’s employees with knowledge
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`about the covered products are likely to be found in Cincinnati, Ohio” and that New York is thus
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`clearly more convenient due to the alleged 260 additional miles that would have to be traveled
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`from Ohio to Marshall versus New York City. First, Hillman’s likely witnesses will also include
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`Case 2:19-cv-00209-JRG Document 52 Filed 09/27/19 Page 14 of 20 PageID #: 2400
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`multiple individuals located at its Boulder, Colorado and Tempe, Arizona facilities, as those
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`locations are where Hillman’s covered products are designed and manufactured.4 See Ex. B
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`(Kitzberger Tr.) at 25:6-35:8 (
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`); Ex. C at 14-17 (
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`
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`). Boulder is less than 800 miles as the
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`crow files from Marshall, and approximately 970 miles by road; in contrast, New York is twice as
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`distant. Ex. A (O’Quinn Decl.) at ¶ 4; Ex. M. Similarly, Tempe (outside of Phoenix) is
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`approximately 1,000 miles from Marshall as the crow flies and 1,200 miles by road, but more than
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`2,000 miles by both measures from New York. See Ex. A (O’Quinn Decl.) at ¶ 3; Ex. F.
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`Moreover, KeyMe opted not to update or refile its Motion after Hillman filed its First
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`Amended Complaint on September 3, 2019. (D.I. 30.) Accordingly, KeyMe’s transfer analysis
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`completely ignores that there is a new patent-in-suit, U.S. Patent No. 10,400,474, with four
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`inventors all located in Arizona. (Id. at ¶ 20; D.I. 30-3 at 1 (inventors).) Similarly, Daniel Freeman
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`and Ari Freeman, the inventors of the ’446 and ’179 patents in suit, live in California and would
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`be more inconvenienced by a trial in New York versus the shorter flight to Texas. (See D.I. 30-1
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`at 1; D.I. 30-2 at 1 (inventors).) Since, as KeyMe concedes, under the Fifth Circuit’s 100-mile
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`rule, the “factor of inconvenience to witnesses increases in direct relationship to the additional
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`distance to be traveled,” the inconvenience to Hillman’s witnesses and to the inventors of the
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`patents-in-suit (both party and non-party) is far higher if the case is transferred. See Volkswagen
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`I, 371 F.3d at 204-05.
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`4 KeyMe misidentifies Colorado-based “Minute Key employees” as being third party witnesses
`(D.I. 14 at 8-9); Minute Key has been part of Hillman since August, 2018, as KeyMe’s own
`exhibits to this Motion and Hillman’s Motion to Disqualify demonstrate. (See, e.g., D.I. 14-2 at
`3-4; D.I. 35 at 5.)
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`Case 2:19-cv-00209-JRG Document 52 Filed 09/27/19 Page 15 of 20 PageID #: 2401
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`KeyMe’s analysis of other alleged third party witnesses is similarly flawed. First, KeyMe
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`simply asserts that third party witnesses “cannot be found in this District.” (D.I. 14 at 8-9.) That
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`is not the test; the test is the convenience for such witnesses to travel based on the distance to
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`Marshall. Next, KeyMe cites “UniKey employees…in Florida” and “the prosecuting attorney of
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`those patents…in Ohio” with no analysis whatsoever as to who those individuals are, what
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`testimony they might provide, and what relevance they might have to this case. (Id.) Nor does
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`KeyMe even attempt to assess whether those witnesses would be willing to attend trial, and
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`whether trial in Marshall versus New York would pose any added inconvenience. This Court has
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`previously found that such non-specific disclosure “does not assist the Court in this inquiry.”
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`Seven Networks, 2018 WL 4026760, at *4. When a proper analysis of witness convenience is
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`undertaken, this factor weighs against transfer. A transfer that simply shifts inconvenience from
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`KeyMe to Hillman is “not the purpose of § 1404.” Traxxas, L.P. v. Hobbico, Inc., No. 2:16-CV-
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`00768-JRG-RSP, 2017 WL 9935517, at *4 (E.D. Tex. Aug. 21, 2017).
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`d. Practical Problems Do Not Apply in this Case
`KeyMe addresses a fourth private interest factor, which is “all other practical problems that
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`make a trial easy, expeditious, and inexpensive.” In re TS Tech USA Corp., 551 F.3d 1315, 1319
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`(Fed. Cir. 2008). “Although not an enumerated factor, judicial economy can be considered when
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`determining whether it is appropriate to transfer a case in the interest of justice.” Va. Innovation,
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`2019 WL 3082314, at *23 (citation omitted). KeyMe is correct that Hillman has not filed any
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`other cases in this District pertaining to key duplication technology or to the patents-in-suit;
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`however, the same is true for the Southern District of New York. The “difficulties that courts are
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`trying to avoid when analyzing this factor include inconsistent rulings and claim constructions.”
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`Id. at *27 (citing Invitrogen Corp. v. Gen. Elec. Co., No. 6:08-cv-112, 2009 WL 331891, at *4
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`11
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`Case 2:19-cv-00209-JRG Document 52 Filed 09/27/19 Page 16 of 20 PageID #: 2402
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`(E.D. Tex. Feb. 9, 2009)). Those difficulties are not at issue either in Texas or in New York. This
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`factor is neutral.
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`2. No Public Interest Factor Weighs in Favor of Transfer to New York
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`
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`a. Court Congestion Favors Keeping the Case in Marshall
`The first public interest factor is “the administrative difficulties flowing from court
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`
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`congestion.” TS Tech, 551 F.3d at 1319. KeyMe asserts that S.D.N.Y. has 122 “open patent cases”
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`compared to 480 for this District, and that “[t]he overall time from filing to final disposition of a
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`patent case for these two districts is similar.” (D.I. 14 at 10.) This is not the test. “The relevant
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`inquiry under this factor is ‘[t]he speed with which a case can come to trial and be resolved....’”
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`Seven Networks, 2018 WL 4026760, at *14 (quoting In re Genentech, 566 F.3d at 1347).
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`Depending on the data reviewed from the United States Courts, cases come to trial in the Eastern
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`District of Texas anywhere from five to eleven months faster than in the Southern District of New
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`York. See Ex. A (O’Quinn Decl.) at ¶¶ 5-6; Ex. N (2018 data, showing 31.8 months in S.D.N.Y.
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`and 21.2 months in E.D. Tex., for a difference of 10.6 months); Ex. O (2019 data, showing 32.4
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`months in S.D.N.Y. and 27.0 months in E.D. Tex., for a difference of 5.4 months). Multiple courts
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`in this District have compared E.D. Tex. and S.D.N.Y. on this factor using this data, and have
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`concluded that the factor weighs against transfer to New York. See, e.g., Luminati Networks Ltd.
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`v. BIScience Inc., No. 2:18-CV-00483-JRG, 2019 WL 2084426, at *8 (E.D. Tex. May 13, 2019)
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`(“The congestion faced by the Southern District of New York, resulting in trial times more than
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`50% longer than in the Eastern District of Texas, weighs against transfer.”); Peloton Interactive,
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`Inc. v. Flywheel Sports, Inc., No. 2:18-CV-00390-RWS-RSP, 2019 WL 2303034, at *5 (E.D. Tex.
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`May 30, 2019) (“Because the statistics show that a trial would likely occur more than 10 months
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`ear