Case 6:12-cv-00799-JRG Document 38 Filed 06/17/13 Page 1 of 8 PageID #: 1416
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE EASTERN DISTRICT OF TEXAS
`TYLER DIVISION
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`C.A. No. 6:12-cv-00799-LED
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`JURY TRIAL DEMANDED
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`§§
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`§
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`§§
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`§
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`§§
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`§
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`INVENSYS SYSTEMS, INC.,
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`v.
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`Plaintiff,
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`EMERSON ELECTRIC CO. and
`MICRO MOTION INC., USA,
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`Defendants.
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`PLAINTIFF INVENSYS SYSTEMS, INC.’S RESPONSE TO DEFENDANTS’
`MOTION TO STAY PROCEEDINGS PENDING RESOLUTION OF
`DEFENDANTS’ MOTION TO TRANSFER VENUE PURSUANT TO 28 U.S.C. § 1404(a)
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`A stay is completely unnecessary. Briefing on the transfer motion, which included
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`extensive evidentiary materials, was completed only two months ago.
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`In contrast, the cases on
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`which Defendants Emerson Electric Co. (“Emerson”) and Micro Motion Inc., USA (“Micro
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`Motion”) (collectively “Defendants”) primarily rely involved delays of at least a year.
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`In addition, Defendants’ concern about duplicative litigation in the absence of a stay is
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`without merit. The initial discovery in this case—the parties’ respective positions on claim
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`construction, infringement, invalidity, and production of Defendants’ technical documents—will
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`need to be provided regardless of whether the Court transfers this case to Colorado. A stay on
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`the eve of entry of the discovery order (and with discovery starting in July) would also severely
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`prejudice Plaintiff Invensys Systems, Inc. (“Invensys”), which is a direct competitor of
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`Defendants in the coriolis flowmeter market, and has suffered significant damages as a result of
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`Defendants’ ongoing infringing conduct.
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`Case 6:12-cv-00799-JRG Document 38 Filed 06/17/13 Page 2 of 8 PageID #: 1417
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`BACKGROUND
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`Defendants’ representations about
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`the status of this case are not entirely accurate.
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`Invensys amended its Complaint earlier this year, promptly filed its Notice of Readiness for
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`Status Conference following the close of pleadings, and sent Defendants proposed Docket
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`Control, Discovery, and ESI Orders before Defendants filed their motion to stay. See E-mail
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`from Jeffrey Johnson, counsel for Invensys, to Linda Hansen et al., counsel for Defs. (May 31,
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`2013 at 10:51 AM) (Ex. A) (transmitting Docket Control, ESI, and Discovery Orders); E-mail
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`from CM/ECF Sys., E.D. Tex., to Amy Mohan et al., counsel for Invensys (May 31, 2013 at 4:35
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`PM) (Ex. B) (notifying counsel of the filing of Defendants’ motion to stay). All of Invensys’
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`proposed orders track the Court’s model orders, and their acceptance should be uncontroversial.
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`Thus, Defendants statement that “[t]he parties have not yet conducted . . . any negotiations
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`regarding” the Docket Control, ESI, and Discovery Orders is misleading. Defs.’ Mot. to Stay
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`Proceedings Pending Resolution of Defs.’ Mot. to Transfer Venue Pursuant to 28 U.S.C. §
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`1404(a) at 2, ECF. No. 36 (“Defs.’ Mot. to Stay”).
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`Similarly, Defendants description of the facts relevant to the transfer motion contains
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`several key omissions.
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`Invensys will not belabor the Court with a repetition of its previous
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`briefing, but highlights (inter alia) the following facts: 1) a significant number of Invensys’
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`documents and witnesses are located in or near this district, 2) Defendants’ witnesses and
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`documents are not concentrated in Colorado because all of Emerson’s evidence is located in
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`Missouri, 3) some third-party witnesses are located in Texas while none appear to be in
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`Colorado, and 4) Texas has a special connection to the subject matter of this suit that Colorado
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`does not share.1 Transfer would be improper under these circumstances.
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`1 Emerson continues to insist that it is not a proper party to this case. See id. at 1 n.1. Of course, even the cases
`Defendants cite hold that the merits of a case are “irrelevant to the determination of the preliminary question of
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`Case 6:12-cv-00799-JRG Document 38 Filed 06/17/13 Page 3 of 8 PageID #: 1418
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`ARGUMENT
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`I.
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`None of the Cases Defendants Cite Support a Stay in This Case.
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`The appellate decisions Defendants rely on principally involve mandamus petitions
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`challenging the denial of a transfer motion in which the defendant complained (only sometimes
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`successfully) that the district court improperly relied on its own delay in ruling on the transfer
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`motion as a basis for retaining the case. Indeed, In re: Horseshoe Entertainment, 337 F.3d 429
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`(5th Cir. 2003), In re EMC Corp., Misc. No. 142, 2013 WL 324154 (Fed. Cir. Jan. 29, 2013),
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`and In re VTech Communications, Inc., Misc. No. 909, 2010 WL 46332 (Fed. Cir. Jan. 6, 2010),
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`do not even mention a stay by the district court, and the EMC court apparently denied a request
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`to stay the district court proceedings pending a ruling on the mandamus petition.2 See 2013 WL
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`324154, at *3. Collectively, Defendants’ cases merely stand for the unexceptional proposition
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`that district courts should resolve transfer motions promptly. Most involved substantial delays in
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`ruling on a transfer motion (far in excess of the reasonable time lapse in the instant case) or
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`readily distinguishable facts, and none suggest
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`that a stay is always, or even usually,
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`appropriate.3
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`Horseshoe Entertainment, on which all the Federal Circuit decisions Defendants cite
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`relied, is particularly telling. In Horseshoe Entertainment, the district court inexplicably waited
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`transfer.” In re Fusion-IO, Inc., Misc. No. 139, 2012 WL 6634939, at *1 (quoting McDonnell Douglas Corp. v.
`Polin, 429 F.3d 30, 30-31 (3d Cir. 1970)). In addition, Emerson’s protests that it is not a proper party are limited
`to an assertion that it does not directly infringe, completely ignoring the fact that Invensys has also sued Emerson
`for indirect infringement.
`2 In re Fusion-IO, Inc., Misc. No. 139, 2012 WL 6634939, at *1 (Fed. Cir. Dec. 21, 2012), did mention a motion to
`stay, but nothing in that opinion purports to mandate a stay as a matter of course.
`3 None of the cases Defendants cite for the stay standard involved a request for a stay pending resolution of a
`transfer motion and all involved facts radically different than this case. See Landis v. N. Am. Co., 299 U.S. 248
`(1936) (granting stay to await Supreme Court decision); Esquivel v. BP Co. N. Am., Inc., Civ. No. B-10-227, 2010
`WL 4255911 (S.D. Tex. Oct. 14, 2010) (granting stay of case arising out of the Deep Water Horizon disaster
`pending resolution of MDL request); Nguyen v. BP Exploration & Prod., Inc., Civ. No. H-10-2484, 2010 WL
`3169316 (S.D. Tex. Aug. 9, 2010) (same); Soverain Software LLC v. Amazon.com, Inc., 356 F. Supp. 2d 660, 662
`(E.D. Tex. 2005) (denying stay pending reexamination).
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`Case 6:12-cv-00799-JRG Document 38 Filed 06/17/13 Page 4 of 8 PageID #: 1419
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`thirteen months to rule on a transfer motion, and when it finally denied the motion, it clearly
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`abused its discretion by considering irrelevant factors and ignoring relevant factors. See 337
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`F.3d at 433-34. In contrast, briefing on the transfer motion in this case was completed only two
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`months ago, and Defendants lack a strong basis for changing venue.
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`Similarly, in EMC it apparently took years for the district court to address the transfer
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`motion, and then the court improperly used its own delay in ruling on the motion to find that
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`judicial economy weighed against transfer. See 2013 WL 324154, at *2. Significantly, despite
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`this error the Federal Circuit still concluded that the district court had acted properly in denying
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`transfer. See id. at *2-3.
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`In In re Fusion-IO, Inc., Misc. No. 139, 2012 WL 6634939 (Fed. Cir. Dec. 21, 2012),
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`(which was styled Solid State Storage Solutions, Inc. v. STEC, Inc., No. 2:11-cv-391-JRG-RSP
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`in the district court), the district court did issue a stay, but the transfer issue had been pending for
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`almost a year by that time. See Def. Fusion-IO’s Mot. to Stay Proceedings Pending Resolution
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`of Renewed Mot. to Transfer in Accord with Fed. Cir.’s Mandamus Order at 1, Solid State (E.D.
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`Tex. Dec. 26, 2012), ECF No. 284.
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`Defendants’ reliance on VTech Communications, the only other Federal Circuit authority
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`Defendants’ cite, is perplexing.4 VTech Communications not only denied mandamus, but also
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`expressly distinguished Horseshoe Entertainment. See 2010 WL 46332, at *2 (“Although there
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`may have been some delay, we do not read Horseshoe as precluding the district court from
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`4 The passage from VTech Communications Defendants quote was actually the court chiding VTech for its lack of
`zeal in pursuing its transfer motion. See id. at *2 (“It was incumbent on VTech to actively and promptly pursue
`its motion to transfer venue before the district court invested considerable time and attention to discovery and
`completing claim construction.”). Invensys does not dispute that Defendants’ transfer motion was timely.
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`Case 6:12-cv-00799-JRG Document 38 Filed 06/17/13 Page 5 of 8 PageID #: 1420
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`considering its investment and familiarity with the case when determining the prudence of
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`transfer.”).5
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`Unlike Horseshoe Entertainment and its progeny, all of which involved delays of a year
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`or more, briefing on Defendants’ transfer motion was completed only two months ago. Because
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`it must balance a multiplicity of factors under the § 1404(a) standard and review the evidence
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`submitted by the parties, the Court cannot be expected to rule on Defendants’ transfer motion
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`instantaneously, but must be permitted adequate time to exercise its discretion. Moreover, unlike
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`the defendants in Horseshoe Entertainment, Defendants in this case lack a strong basis for
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`seeking transfer. Accordingly, a stay is unwarranted under the facts of this case.
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`II.
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`None of the Factors Defendants Cite Support a Stay.
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`A.
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`A Stay Will Prejudice Invensys, Especially Since Invensys and Defendants
`Are Direct Competitors.
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`Defendants fail to explain why staying this case in its early stages is any less prejudicial
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`to Invensys than staying it at a later time would be. Simply put, delay is delay. Moreover, a stay
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`would be particularly harmful in this case since Invensys and Defendants are direct competitors
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`in the coriolis flowmeter market, and Invensys is continuing to lose coriolis flowmeter sales as a
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`result of Defendants’ infringement. While Defendants in this case take issue with the amount of
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`time Invensys took to investigate its claims before filing suit, this is a complex, seven patent
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`case, and Invensys should not be penalized for its thorough presuit investigation.
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`B.
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`There Is No Risk of Duplicative Litigation.
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`The initial discovery in this case will principally concern the parties’ positions on claim
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`construction,
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`infringement, and invalidity and the production of Defendants’
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`technical
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`5 The remaining cases Defendants cite were all authored by a single district judge in the Western District of
`Tennessee. Those decisions seem to grant a stay pending consideration of a transfer motion as a matter of course.
`As explained below in Part II.C, routinely granting stays pending transfer requests encourages dilatory conduct,
`and the Tennessee court’s decisions should not be followed by this Court.
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`Case 6:12-cv-00799-JRG Document 38 Filed 06/17/13 Page 6 of 8 PageID #: 1421
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`documents. This discovery will be necessary regardless of whether the Court transfers this case
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`(and regardless of whether the District of Colorado has patent rules since this Court’s Patent
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`Rules simply standardize the disclosure of information that would otherwise have to be obtained
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`through interrogatories and document requests). See Network Caching Tech., LLC v. Novell,
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`Inc., No. C-01-2079 VRW, 2003 WL 21699799, at *4 (N.D. Cal. Mar. 21, 2003) (noting that
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`disclosure requirements in local patent rules take the place of multiple interrogatories that would
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`otherwise need to be propounded);6 see also Suncast Techs., L.L.C. v. Patrician Prods., Inc., No.
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`07-80414-CIV, 2008 WL 179648, at *9 (S.D. Fla. Jan. 17, 2008) (noting that “local patent rules
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`embody the collective wisdom and experience of groups of judges and practicing patent lawyers”
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`about the proper scope of discovery in patent cases). Thus, there is no risk that the parties or the
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`courts will duplicate any work, and the initial paper discovery that may take place during the
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`pendency of the transfer motion will not require travel by fact witnesses that might otherwise be
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`avoided. And for the reasons set forth in its response to Defendants’ transfer motion, many of
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`the relevant witnesses are located in Texas, Massachusetts, Missouri, and overseas anyway, not
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`in Colorado as Defendants contend. See Pl.’s Resp. to Def.’s Mot. to Transfer Venue Pursuant to
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`28 U.S.C. § 1404(a) at 9-14, ECF No. 26. Defendants’ claim that they will be prejudiced in the
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`absence of a stay is nothing more than a red herring at this stage of the case.
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`C.
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`Granting a Stay Would Encourage Gamesmanship.
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`“[A]s a delaying tactic [§ 1404(a)] has few equals.” 15 CHARLES ALLAN WRIGHT,
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`ARTHUR R. MILLER & EDWARD H. COOPER, FEDERAL PRACTICE AND PROCEDURE § 3841, at 5 (3d
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`ed. 2007) (quotations omitted). Transfer motions also divert the parties and the court “from their
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`pursuit of the merits of a lawsuit while they argue about and decide where those merits may be
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`6 Because the “Local Patent Rules of the Eastern District of Texas were modeled on the rules of the Northern
`District of California . . . interpretations of those rules by courts of the Northern District of California [are]
`persuasive authority.” Nike, Inc. v. Adidas Am., Inc., 479 F. Supp. 2d 664, 667 n.2 (E.D. Tex. 2007).
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`Case 6:12-cv-00799-JRG Document 38 Filed 06/17/13 Page 7 of 8 PageID #: 1422
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`determined most conveniently.” Id. at 4 Routinely granting a stay whenever a defendant files a
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`transfer motion would only exacerbate these problems and promote dilatory tactics.
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`CONCLUSION
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`Because Defendants’ motion to transfer has been fully briefed for only two months, a
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`stay is completely unnecessary. In addition, the delay caused by a stay would prejudice Invensys
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`without providing any benefit to Defendants or the judicial system. Accordingly, Invensys
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`respectfully requests that the Court deny Defendants’ Motion to Stay Proceedings Pending
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`Resolution of Defendants’ Motion to Transfer Venue Pursuant to 28 U.S.C. § 1404(a).
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`Date:
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`June 17, 2013
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`Respectfully submitted,
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`/s/ Claudia Wilson Frost
`Claudia Wilson Frost
`State Bar No. 21671300
`Jeffrey L. Johnson
`State Bar No. 24029638
`Amy P. Mohan
`State Bar No. 24051070
`DLA PIPER LLP
`1000 Louisiana, Suite 2800
`Houston, TX 77002
`Telephone: 713.425.8400
`Facsimile: 713.425.8401
`Claudia.Frost@dlapiper.com
`Jeffrey.Johnson@dlapiper.com
`Amy.Mohan@dlapiper.com
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`Nicholas G. Papastavros
`Daniel Rosenfeld
`DLA PIPER LLP
`33 Arch Street, 26th Floor
`Boston, MA 02110
`Telephone: 617.406.6000
`Facsimile: 617.406.6100
`Nick.Papastavros@dlapiper.com
`Daniel.Rosenfeld@dlapiper.com
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`ATTORNEYS FOR INVENSYS SYSTEMS, INC.
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`Case 6:12-cv-00799-JRG Document 38 Filed 06/17/13 Page 8 of 8 PageID #: 1423
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`CERTIFICATE OF SERVICE
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`I certify that the foregoing document was filed electronically on June 17, 2013, pursuant
`to Local Rule CV-5(a) and has been served on all counsel who have consented to electronic
`service. Any other counsel of record will be served by first class U.S. mail on this same date.
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`/s/ Claudia Wilson Frost
`Claudia Wilson Frost
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