Case 5:19-cv-00036-RWS Document 72 Filed 09/04/19 Page 1 of 16 PageID #: 3748
`Case 5:19-cv-OOO36-RWS Document 72 Filed 09/04/19 Page 1 of 16 PageID #: 3748
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`IN THE UNITED STATES DISTRICT COURT
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`FOR THE EASTERN DISTRICT OF TEXAS
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`TEXARKANA DIVISION
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`MAXELL, LTD.,
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`_
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`Plaintiff,
`vs. —
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`Civil Action No. 5:19—cv—00036-RWS
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`APPLE INC.,
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`Defendant.
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`JURY TRIAL DEMANDED
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`APPLE INC.’S REPLY IN SUPPORT OF AMENDED MOTION TO TRANSFER
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`VENUE PURSUANT TO 28 U.S.C. § 1404121!
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`Case 5:19-cv-00036-RWS Document 72 Filed 09/04/19 Page 2 of 16 PageID #: 3749
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`TABLE OF CONTENTS
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`I.
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`II.
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`INTRODUCTION ............................................................................................................. 1
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`Page
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`A.
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`B.
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` ............ 4
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`III.
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`THE PUBLIC INTEREST FACTORS COLLECTIVELY FAVOR TRANSFER ........... 4
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`A.
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`B.
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`C.
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`Local Interests Favor Transfer ............................................................................... 4
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`Familiarity With Governing Law Favors Transfer ................................................ 5
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`The Court-Congestion Factor Is Neutral ................................................................ 6
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`IV.
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`THE PRIVATE INTEREST FACTORS ALSO FAVOR TRANSFER ............................ 6
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`A.
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`Ease of Access to Sources of Proof, Compulsory Process, and Cost of
`Attendance of Willing Witnesses All Favor Transfer ............................................ 6
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`1.
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`2.
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`3.
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`Apple’s Witnesses and Sources of Proof ................................................... 6
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`Third-Party Witnesses and Sources of Proof ............................................. 8
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`Maxell’s Witnesses and Sources of Proof ................................................. 9
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`B.
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`The Judicial Economy Factor Is Neutral ............................................................. 10
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`V.
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`CONCLUSION ................................................................................................................ 10
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`i
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`TABLE OF AUTHORITIES
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`Page(s)
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`Cases
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`Black Hills Media, LLC v. Samsung Electronics Co., Ltd., et al.,
`No. 2:13-cv-379-JRG-RSP (E.D. Tex. Mar. 17, 2014) .............................................................. 6
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`Cellular Commc’ns Equip. LLC v. Apple Inc.,
`6:14-cv-00251 (E.D. Tex.) .......................................................................................................... 7
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`ColorQuick, LLC v. Vistaprint Ltd.,
`No. 6:09-cv-323, 2010 WL 5136050 (E.D. Tex. July 22, 2010) .............................................. 10
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`ContentGuard Holdings, Inc. v. Amazon, Inc.,
`No. 2:13-cv-1112, 2015 WL 1885256 (E.D. Tex. Apr. 24, 2015) ............................................. 5
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`Dynamic Data Techns., LLC v. Qualcomm Inc.,
`2-18-cv-00470-RWS, D.I. 52 (E.D. Tex. Aug. 13, 2019) .......................................................... 8
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`EVS Codec Techs., LLC v. LG Elecs., Inc.,
`No. 2:18-cv-00343-JRG, 2019 WL 2904747 (E.D. Tex. July 5, 2019) ..................................... 4
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`Gen. Protecht Grp., Inc. v. Leviton Mfg. Co.,
`651 F.3d 1355 (Fed. Cir. 2011) .................................................................................................. 4
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`GeoTag, Inc. v. Aromatique, Inc.,
`No. 2:10-cv-570, 2013 WL 8349856 (E.D. Tex. 2013) ............................................................ 10
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`Husqvarna AB v. Toro Co.,
`No. 3:14-cv-103-RJC-DCK, 2015 WL 3908403 (W.D.N.C. 2015) ........................................... 9
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`In re Acer Am. Corp.,
`626 F.3d 1252 (Fed. Cir. 2010) .................................................................................................. 5
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`In re Hoffman-La Roche, Inc.,
`587 F.3d 1333 (Fed. Cir. 2009) ............................................................................................ 5, 10
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`In re Horseshoe Entm’t,
`337 F.3d 429 (5th Cir. 2003) ...................................................................................................... 9
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`In re Nintendo Co., Ltd.,
`589 F.3d 1194 (Fed. Cir. 2009) .................................................................................................. 5
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`Innovative Global Systems LLC v. Onstar, LLC,
`No. 6:10-CV-574-JDL, 2012 WL 12930885 (E.D. Tex. Feb. 14, 2012) .................................. 10
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`ii
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`Case 5:19-cv-00036-RWS Document 72 Filed 09/04/19 Page 4 of 16 PageID #: 3751
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`TABLE OF AUTHORITIES
`(continued)
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`Page(s)
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`Marine Constr. Co. v. U.S. Dist. Court for the W. Dist. of Tex.,
`134 S. Ct. 568 (2013) .................................................................................................................. 4
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`Maxell, Ltd. v. ASUSTek Computer Inc.,
`No. 3:18-cv-01788-VC, D.I. 37 (N.D. Cal. Jan. 12, 2018) ....................................................... 10
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`Omni MedSci, Inc. v. Apple Inc.,
`No. 2:18:cv-00134-RWS, D.I. 279 (E.D. Tex. Aug. 14, 2019) .............................................. 6, 7
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`Smartflash LLC v. Apple Inc.,
`No. 6:13-cv-00447 (E.D. Tex.) ................................................................................................... 7
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`Tessera Advanced Techs., Inc. v. Samsung Elecs. Co., Ltd.,
`No. 2:17-cv-00671-JRG, 2018 WL 8014281 (E.D. Tex. Sept. 5, 2018) ................................ 4, 5
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`iii
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`Case 5:19-cv-00036-RWS Document 72 Filed 09/04/19 Page 5 of 16 PageID #: 3752
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`I.
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`INTRODUCTION
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`Transfer is additionally warranted because, as this Court has found in other cases involving
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`Apple, the relevant private and public interest factors favor transfer. Maxell tries to manufacture
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`ties to this District through its retained outside counsel—an argument that courts have repeatedly
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`rejected. Maxell also points broadly to Apple vendors and suppliers in Texas who have no material
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`evidence relevant to this case. The fact that Apple and some of its vendors may have employees
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`in Texas is irrelevant—the pertinent question is whether there are likely relevant witnesses and
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`sources of proof in the EDTX. Other than its counsel, Maxell fails to allege there is any relevant
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`witness or evidence located in the EDTX. And Maxell does not dispute that the NDCA would be
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`more convenient for the inventors of the patents-in-suit. Because venue is clearly more convenient
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`in the NDCA, Apple respectfully requests that this Court transfer the case.
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`h—tF—(
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`Case 5:19-cv-00036-RWS Document 72 Filed 09/04/19 Page 7 of 16 PageID #: 3754
`Case 5:19-cv-00036—RWS Document 72 Filed 09/04/19 Page 7 of 16 PageID #: 3754
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`III. THE PUBLIC INTEREST FACTORS COLLECTIVELY FAVOR TRANSFER
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`An applicable forum-selection clause must control “except in unusual cases” where there
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`are significant public interest factors weighing against transfer. Atlantic Marine Constr. Co. v.
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`U.S. Dist. Court for the W. Dist. of Tex., 134 S. Ct. 568, 582 (2013). As Apple has shown, the
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`public factors in this case are either neutral or favor transfer.
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`A.
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`Local Interests Favor Transfer
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`While Maxell purports to operate a subsidiary named Maxell Research and Development
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`4
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`America, LLC (“MRDA”) in the EDTX, it does not dispute MRDA has no employees in the
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`EDTX. See, e.g., D.I. 65-51, ¶¶ 13-15. By comparison, Apple has resided in the NDCA since its
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`founding over 40 years ago and has over 30,000 employees there. See D.I. 57-1, ¶¶ 6-7. The
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`NDCA’s interest in Apple is clearly far more extensive than any interest the EDTX may have in
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`the employee-less, and irrelevant, MRDA.
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`Maxell argues that Apple’s operations in Austin—not in this District—and suppliers in
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`Texas render the local interest factor neutral.3 But Maxell offers no evidence that Apple’s
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`operations or vendors in Texas are relevant to any material issue in dispute in this case. The
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`undisputed evidence establishes that engineers in Apple’s NDCA headquarters designed and
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`implemented the accused technologies and that this case directly implicates those California-based
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`engineers and chipset vendors. See D.I. 57-1, ¶¶ 15-33. Thus, the local-interest factor favors
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`transfer. See Hoffman-LaRoche, 587 F.3d at 1338; In re Acer Am. Corp., 626 F.3d 1252, 1256
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`(Fed. Cir. 2010); In re Nintendo Co., Ltd., 589 F.3d 1194, 1198 (Fed. Cir. 2009).
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`B.
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`Familiarity With Governing Law Favors Transfer
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`3 In evaluating local interest, the Federal Circuit distinguishes between different districts in the
`same state. See In re Hoffman-La Roche, Inc., 587 F.3d 1333, 1335-36 (Fed. Cir. 2009).
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`5
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`Case 5:19-cv-00036-RWS Document 72 Filed 09/04/19 Page 10 of 16 PageID #: 3757
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`C.
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`The Court-Congestion Factor Is Neutral
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`In a recent decision transferring an Apple case to the NDCA, this Court found that “[t]he
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`latest data show no significant difference in the time to trial” between the EDTX and the NDCA.
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`Omni MedSci, Inc. v. Apple Inc., No. 2:18:cv-00134-RWS, D.I. 279, at *8 (E.D. Tex. Aug. 14,
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`2019) (Ex. GG). The early stage of this case further supports the neutrality of this factor—the
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`parties have not begun claim construction and this Court has not ruled on any substantive motion—
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`and thus, there is no risk that a transfer will impose undue delay. Moreover, neither Maxell nor
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`MRDA makes or sells any product that practices the claimed inventions, and thus they do not
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`compete with Apple. D.I. 57-16, 35. Maxell’s argument that any delay caused by transfer would
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`harm its licensing program fails because, as another Court in this district found when imposing a
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`stay, a delay does not impose prejudice on a non-competitor. See Black Hills Media, LLC v.
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`Samsung Electronics Co., Ltd., et al., No. 2:13-cv-379-JRG-RSP (E.D. Tex. Mar. 17, 2014)
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`(“[T]here is no prejudice visited upon the Plaintiffs by staying the entire case …. [Plaintiff] does
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`not compete with Defendants in the consumer electronics field.”). This factor, thus, is neutral.
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`IV.
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`THE PRIVATE INTEREST FACTORS ALSO FAVOR TRANSFER
`A.
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`Ease of Access to Sources of Proof, Compulsory Process, and Cost of
`Attendance of Willing Witnesses All Favor Transfer
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`1.
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`Apple’s Witnesses and Sources of Proof
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`Maxell’s arguments based on Apple’s operations in the Austin area—not in this District—
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`and the locations of Apple’s document servers have already been rejected by this Court. In Omni
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`MedSci, this Court found that “[t]hough Apple maintains a facility in Austin, Texas, where
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`documents may also be accessible, Apple’s only places of business in this district—the relevant
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`inquiry—are two retail stores. [Plaintiff] has not established that these locations can access any
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`relevant documents.” Simmons Decl., Ex. GG, 5 n.7. Moreover, the Court explained that “[a]s
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`the defendant in a patent case, the bulk of the documents produced belong to Apple and are more
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`easily accessible where it maintains its headquarters.” Id., 5.
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`—— —
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`Maxell also identified several Apple employees in the NDCA with relevant
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`knowledge about pre-suit negotiations. D.I. 57-17, 20. Maxell’s arglnnents based on Apple’s
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`Austin microprocessor team, AppleCare customer support, and content updating for maps are an
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`irrelevant distraction. See D.I. 65, 4-5. Maxell does not cite anything in its infringement
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`contentions where Apple’s microprocessor design, customer support services, or maps updating
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`(as opposed to the accused navigation fimctionality) are at issue. Maxell also accuses Apple of
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`gamesmanship by pointing to two cases in which Apple called witnesses at trial who were not
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`identified in Apple’s transfer motions. See id. , l7 (citing Cellular Commc ’ns Equip. LLC v. Apple
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`Inc., 6:14-cv-00251 (ED. Tex.); Smartflash LLC v. Apple Inc., No. 6:13-cv-00447 (E.D. Tex.)).
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`But Maxell’s argument fails because fl trial witnesses it identified from these two cases were
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`located in the NDCA. See Simmons Decl., Exs. Y—CC . For example, in Smartflash, two ofApple’s
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`three trial witnesses were identified in the transfer motion, and the third witness was an engineer
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`from the NDCA. Id., Ex. AA. In these cases cited by Maxell—as in the current case and the vast
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`majority of Apple’s patent cases—Apple’s relevant witnesses and sources of proof are in the
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`NDCA. In fact, Apple has never called a Texas employee to testify at a US. patent trial.4
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`4 Historically, 95% of Apple’s employee witnesses called at its patent trials were located in the
`NDCA. See Uniloc USA, Inc. v. Apple Inc., No. 1:18-cv-00158-LY, D.I. 56, *5 (W.D. Tex. Mar.
`1, 2019) (“Since 2013, Apple employees have presented live testimony in patent trials across the
`United States fifty-seven times. Fifty-four of those times—95%— involved testimony by Apple
`employees located in the NDCA. The other three times involved Apple employees in Germany,
`France, and Colorado.”); Evolved Wireless LLC v. Apple Inc. , No. 1:15—cv-00542—JFB—SRF, D.I.
`507-520 0). Del. Mar. 28-Apr. 4, 2019) (calling three NDCA witnesses at a recent 2019 trial).
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`2.
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`Third-Party Witnesses and Sources of Proof
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`Maxell identifies Apple’s vendors located in Texas outside of this District. See D.I. 65,
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`15-16. These vendors provide generic components to or services for Apple, and Maxell provides
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`no evidence that any of them have evidence relevant to disputed issues in this case. See id. Indeed,
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`Maxell did not even identify most of these vendors in its Oiiginal initial disclosures. and added
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`them to its disclosures only after filing its transfer opposition. See D.I. 57—17, 11-22. Moreover,
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`most of these vendors are foreign companies that operate branch offices in Texas. See D.I. 65—54.
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`Maxell also overstates the significance of its retained c01msel, Alan Loudermilk. by
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`describing him as a “key fact witness.” D1. 65, 2.
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`I Thus. the relevance of Mr. Loudelmilk’s knowledge is limited at best. Moreover. Mr.
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`Loudermilk is a retained c01msel who is likely willing to appear at trial for Maxell regardless of
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`Case 5:19-cv-00036-RWS Document 72 Filed 09/04/19 Page 13 of 16 PageID #: 3760
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`the venue. For this reason, courts routinely discount the location of counsel as a factor in the
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`transfer analysis. See, e.g., In re Horseshoe Entm’t, 337 F.3d 429, 434 (5th Cir. 2003).
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`By comparison, there are multiple former Apple employees in California who were directly
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`involved in the relevant pre-suit communications between Apple and Hitachi. For example,
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`Maxell identifies former Apple employee Jeff Risher, who resides in California, as having
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`information regarding pre-suit communications. D.I. 57-17, 19.5
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` Thus, there are far more relevant third-party witnesses in California than in Texas.
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`3.
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`Maxell’s Witnesses and Sources of Proof
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`Maxell does not dispute that the NDCA would be more convenient for the named inventors
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`of the patents-in-suit. See D.I. 57, 13. Maxell attempts to manufacture ties to the EDTX through
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`its affiliate MRDA. See Complaint, ¶ 6. However, a foreign corporation cannot rely a wholly-
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`owned subsidiary’s residency to justify its venue choice. See, e.g., Husqvarna AB v. Toro Co.,
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`No. 3:14-cv-103-RJC-DCK, 2015 WL 3908403, at *3 (W.D.N.C. 2015). Critically, MRDA is not
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`a party to this lawsuit, does not have any proprietary interest in the patents-in-suit, and could not
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`have any evidence regarding the development of the alleged inventions since it was founded years
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`after the filing of the patents-in-suit. See Complaint, Exs. 1-10.
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` But this claim is refuted by Maxell’s own P.R. 3-1 disclosures, which state that “it is not
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`presently aware of any of its own apparatuses, products, devices, processes, methods, acts, or other
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`instrumentalities that practice the claimed inventions of the patents-in-suit.” D.I. 57-16, 35.
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`5 Maxell also identifies current Apple employees Heather Mewes and Jayna Whitt—both located
`in the NDCA—as having knowledge of pre-suit communications. See D.I. 57-17, 19.
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`9
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`Case 5:19-cv-00036-RWS Document 72 Filed 09/04/19 Page 14 of 16 PageID #: 3761
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`Moreover, the Federal Circuit and courts in this district have rejected reliance on
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`documents stored at counsel’s office in the EDTX, as Maxell does here. See, e.g., Hoffman-
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`LaRoche, 587 F.3d at 1337 (storing data at counsel’s office “is a fiction which appears to be have
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`been created to manipulate the propriety of venue”); ColorQuick, LLC v. Vistaprint Ltd., No. 6:09-
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`cv-323, 2010 WL 5136050, *5 n.3 (E.D. Tex. July 22, 2010) (“Although Plaintiff avers it
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`maintains electronic documents from the previous case in its counsel’s Texas office, … these
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`documents are irrelevant to the transfer determination.”); Innovative Global Systems LLC v.
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`Onstar, LLC, No. 6:10-CV-574-JDL, 2012 WL 12930885, *4 (E.D. Tex. Feb. 14, 2012) (giving
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`“little weight” to documents at plaintiff’s litigation counsel’s offices). In addition, because Maxell
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`recently sued ASUSTek in the NDCA on patents related to those asserted in this case, its California
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`counsel presumably also has a copy of the relevant files. See Maxell, Ltd. v. ASUSTek Computer
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`Inc., No. 3:18-cv-01788-VC, D.I. 37, at *5 (N.D. Cal. Jan. 12, 2018).
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`B.
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`The Judicial Economy Factor Is Neutral
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`Contrary to Maxell’s argument, prior litigation involving the patents-in-suit in this District
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`does not weigh against transfer. In GeoTag, Inc. v. Aromatique, Inc., another court in this Distract
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`found that “problems with judicial economy do not exist” where the patentee filed prior suits on
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`the same patent in the forum against different accused infringers. No. 2:10-cv-570, 2013 WL
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`8349856, at *5 (E.D. Tex. Jan. 14, 2013). The Court explained that it “will not permit the existence
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`of separately filed cases to sway its transfer analysis” because “[o]therwise, a plaintiff could
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`manipulate venue by serially filling cases within a single district.” Id. Similarly here, Maxell
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`should not be permitted to manipulate venue by serially filing multiple cases in this District.
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`V.
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`CONCLUSION
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`For reasons stated above and in Apple’s opening brief, Apple respectfully requests that this
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`Court transfer this case to the NDCA.
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`10
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`Case 5:19-cv-00036-RWS Document 72 Filed 09/04/19 Page 15 of 16 PageID #: 3762
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`August 30, 2019
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`/s/ Luann L. Simmons
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`Luann L. Simmons (Pro Hac Vice)
`lsimmons@omm.com
`O’MELVENY & MYERS LLP
`Two Embarcadero Center
`28th Floor
`San Francisco, CA 94111
`Telephone: 415-984-8700
`Facsimile: 415-984-8701
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`Xin-Yi Zhou (Pro Hac Vice)
`vzhou@omm.com
`Anthony G. Beasley (TX #24093882)
`tbeasley@omm.com
`O’MELVENY & MYERS LLP
`400 S. Hope Street
`Los Angeles, CA 90071
`Telephone: 213-430-6000
`Facsimile: 213-430-6407
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`Laura Bayne Gore (Pro Hac Vice)
`lbayne@omm.com
`O’MELVENY & MYERS LLP
`Times Square Tower, 7 Times Square
`New York, NY 10036
`Telephone: 212-326-2000
`Facsimile: 212-326-2061
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`Melissa R. Smith (TX #24001351)
`melissa@gilliamsmithlaw.com
`GILLIAM & SMITH, LLP
`303 South Washington Avenue
`Marshall, Texas 75670
`Telephone: (903) 934-8450
`Facsimile: (903) 934-9257
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`Attorneys for Defendant Apple Inc.
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`CERTIFICATE OF SERVICE
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`The 1mdersi91ed hereby certifies that all c01msel of record who are deemed to have
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`consented to electronic service are being served with a copy of this docmnent via the Court's
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`CM/ECF system per Local Rule CV—5(a)(3) on August 30, 2019.
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`/s/ Melissa R. Smith
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`Melissa R. Smith
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`12
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