Case 6:20-cv-00693-ADA Document 55 Filed 02/01/21 Page 1 of 9
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE WESTERN DISTRICT OF TEXAS
`WACO DIVISION
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`Case No. 6:20-cv-00693-ADA
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`JURY TRIAL DEMANDED
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`TRILLER, INC.,
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`Plaintiff,
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`v.
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`BYTEDANCE LTD., BYTEDANCE INC.,
`TIKTOK INC., AND TIKTOK PTE. LTD.,
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`Defendants.
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`I.
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`DEFENDANTS’ MOTION TO STAY PENDING RESOLUTION OF VENUE
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`INTRODUCTION
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`Bytedance Ltd. (“BDL”), Bytedance Inc. (“BDI”), TikTok Inc. (“TTI”), and TikTok Pte.
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`Ltd. (“TTPL”) (collectively, “Defendants”) respectfully request a stay of all dates other than those
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`related to their pending transfer motion. See ECF No. 30. Recently, the Federal Circuit explained
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`that motions to transfer venue “should unquestionably take top priority.” In re Apple, 979 F.3d
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`1332, 1337 (Fed. Cir. 2020); see also In re Horseshoe Entm’t, 337 F.3d 429, 433 (5th Cir. 2003).
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`Because the Northern District of California is clearly a more convenient forum for this litigation,
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`making transfer appropriate, moving forward with claim construction would be inappropriate and
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`inefficient until the pending motion to transfer is resolved. As such, a modest stay of this litigation,
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`in order to resolve the motion to transfer before Markman proceedings, is warranted.
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`II.
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`ARGUMENT
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`In the “context of transfer of venue motions,” the Federal Circuit emphasizes § 1404(a)’s
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`“intent to ‘prevent the waste of time, energy, and money and to protect litigants, witnesses and the
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`public against unnecessary inconvenience and expense.’” In re Google Inc., 2015 WL 5294800,
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`at *1 (Fed. Cir. July 16, 2015) (quoting Van Dusen v. Barrack, 376 U.S. 612, 616 (1964)).1 More
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`recently, the Federal Circuit explained that while “district courts have discretion as to how to
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`handle their dockets, once a party files a transfer motion, disposing of that motion should
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`unquestionably take top priority.” In re Apple, 979 F.3d 1332, 1337 (Fed. Cir. 2020) (emphasis
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`added). Accordingly, both the Fifth and Federal Circuits have “stressed ‘the importance of
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`addressing motions to transfer at the outset of litigation.’” Google, 2015 WL 5294800, at *1
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`(quoting In re EMC Corp., 501 F. App’x 973, 975 (Fed. Cir. 2013)). “Timely motions to transfer
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`venue should be ‘should be given a top priority in the handling of a case.’” Deep Green Wireless
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`LLC v. Ooma, Inc., No. 2:16-CV-0604-JRG-RSP, 2017 WL 679643, at *1 (E.D. Tex. Feb. 21,
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`2017) (quoting Horseshoe, 337 F.3d at 433).
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`In this case, a stay is warranted because, in view of recent Federal Circuit caselaw, it would
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`be both inefficient and inappropriate to proceed with claim construction before the transfer motion
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`is fully resolved. See In re Apple, 979 F.3d at 1338 (holding that instead of resolving the motion
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`to transfer, the district court improperly “held a Markman hearing, issued its claim construction
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`order, held a discovery hearing, and issued a corresponding discovery order” and that “a Markman
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`hearing and claim construction order are two of the most important and time-intensive substantive
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`tasks a district court undertakes in a patent case”). “In determining whether a stay is proper, a
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`district court should consider, among other factors, (1) the potential prejudice to the non-moving
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`party; (2) the hardship and inequity to the moving party if the action is not stayed; and (3) judicial
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`resources.” Neodron Ltd. v. Dell Techs. Inc., No. 1-19-CV-00819-ADA, 2019 WL 9633629, at *1
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`(W.D. Tex. Dec. 16, 2019) (Albright, J.) (citing Yeti Coolers, LLC v. Home Depot U.S.A., Inc.,
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`1
`The “power to stay proceedings” is “incidental to a district court’s inherent power ‘to control the disposition of
`the causes on its docket with economy of time and effort for itself, for counsel, and for litigants.’” In re Beebe,
`56 F.3d 1384, 1995 WL 337666, at *2 (5th Cir. 1995) (quoting Landis v. N. Am. Co., 299 U.S. 248, 254 (1936)).
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`2
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`No. 1:17-CV-342-RP, 2018 WL 2122868 (W.D. Tex. Jan. 8, 2018)). “A district court has the
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`inherent power to stay cases to control its docket and promote efficient use of judicial resources.”
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`Gomez v. Loomis Armored US, LLC, No. 5:16-CV-931-DAE, 2017 WL 2999431, at *3 (W.D.
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`Tex. May 8, 2017) (quoting Coker v. Select Energy Servs., LLC, 161 F. Supp. 3d 492, 494–95
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`(S.D. Tex. 2015)).
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`Here, all three factors support a brief stay of this action pending the resolution of
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`Defendants’ transfer motion.
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`1.
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`A Stay Will Not Unfairly Prejudice Triller, the Non-Moving Party
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`A modest stay to permit resolution of venue is appropriate because staying this case will
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`not prejudice or tactically harm Triller. First, Defendants have made every effort to streamline the
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`present proceedings by seeking transfer only under Section 1404(a) while withdrawing (for
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`purposes of this case only) their challenges based on lack of personal jurisdiction and improper
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`venue. As a result, the issues presented are straightforward and entail limited discovery. Thus, any
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`stay will be of a finite and relatively short duration and will not harm Triller. In this Court, before
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`this Judge, the average time from filing to decision on a transfer motion in patent cases is 4.5
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`months. See LegalMetric Individual Judge Report for Judge Alan D. Albright’s Patent Cases from
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`September 2018 to September 2020 at 69.2 Defendants filed their Motion to Transfer on
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`November 19, 2020, which means that motion could be decided by early April 2021 if not sooner.
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`See ECF No. 30. As such, a stay of litigation will be of a short duration and will not prejudice
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`Triller. See Coker, 161 F. Supp. 3d at 495 (explaining that where “the delay associated with the
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`The average time for this Court to rule on transfer motions across all case types is approximately 77 days
`according to Lex Machina data.
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`3
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`stay will be of a limited duration, no prejudice to [the non-movant] would result from a brief stay
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`in this case”).
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`Defendants acknowledge that the Court now permits up to six months of venue discovery
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`following filing of a transfer motion. See Standing Order Regarding Venue and Jurisdictional
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`Discovery limits for Patent Cases (Nov. 19, 2020). However, given the narrow and discrete issue
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`raised by Defendants’ transfer motion, Defendants believe discovery could and should be
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`completed much faster than six months. Indeed, Defendants have already produced documents and
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`offered up corporate witnesses for deposition at the end of this month. But Triller rejected
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`Defendants’ deposition offer and declined to even identify what other discovery it purports to need,
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`in a transparent effort to drag out transfer proceedings. See Ex. 1 (correspondence between
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`counsel). In any event, even if Triller uses the full six months to take venue discovery, Defendants’
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`motion should be ripe for decision by May 2021, representing minimal delay in the overall case
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`schedule. Moreover, any delay in propounding and taking discovery on the part of Triller would
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`be attributable solely to Triller and thus not prejudicial.
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`Second, because this action is in its early stages, Triller will not suffer prejudice
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`notwithstanding any argument that a stay delays recovery of damages. Courts have explained that
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`it is always the case that a plaintiff will need to wait to recover any money damages when a stay
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`is imposed. See Sandisk Corp. v. Phison Electronics Corp., 538 F. Supp. 2d 1060 (W.D. Wis.
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`2008) (“Plaintiff’s only real ‘injury’ is that it will have to wait for any money damages, which is
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`always the case when a stay is imposed.”). In cases where discovery has not started and where no
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`trial date has been set, stays are more favored. See NFC Tech. LLC v. HTC Am., Inc., No. 2:13-
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`CV-1058-WCB, 2015 WL 1069111, at *3 (E.D. Tex. Mar. 11, 2015) (explaining that “it appears
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`likely that the bulk of the expenses that the parties would incur in pretrial work and trial preparation
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`are still in the future” and “denying a stay because of the progress of the case to this point would
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`impose significant expenses on the parties that might be avoided if the stay results in the
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`simplification (or obviation) of further court proceedings”). Similarly, “district courts frequently
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`grant motions to stay after concluding that the plaintiff will not be prejudiced by a slight delay.”
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`Sparling v. Doyle, No. EP-13-CV-00323-DCG, 2014 WL 12489985, at *3 (W.D. Tex. Mar. 3,
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`2014); see id. (granting a motion to stay where “little discovery ha[d] taken place between the
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`parties” and where “they ha[d] not yet submitted initial disclosures”); see Ctr. for Biological
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`Diversity v. Henson, No. Civ. 08-946-TC, 2009 WL 1882827, at *3 (D. Or. June 30, 2009)
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`(explaining that “[a] six month stay . . . is reasonable”).
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`Here, the original defendants in this case filed their motion on the deadline to respond to
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`the original complaint3, discovery (aside from venue discovery) has not started, and the Court has
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`not scheduled any case deadlines unrelated to venue. Thus, a stay will not interfere with case-
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`related deadlines, and neither party has incurred significant litigation expenses. It also bears noting
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`that Defendants publicly announced the release of their accused Green Screen Video effect on
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`December 11, 2019 (see Ex. 2 (press release)) but Triller waited until July 29, 2020, more than
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`half a year later, to commence its action (see ECF No. 1). The stay sought here would thus be
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`significantly shorter than Triller’s own delay in filing suit. Under these circumstances, a stay of
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`litigation deadlines will not prejudice Triller, and this factor weighs strongly in favor of staying all
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`deadlines until venue is resolved.
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`3
`In response to Defendants’ transfer motion, Triller filed an amended complaint naming two additional closely-
`related parties. See ECF No. 32. Those parties, which share common ownership with the original defendants, have
`since joined the transfer motion without adding any new arguments or otherwise complicating the transfer
`analysis. See ECF No. 45. As noted above, Defendants have also sought to streamline the proceedings by seeking
`transfer only under Section 1404(a) while withdrawing (for purposes of this case only) their challenges based on
`lack of personal jurisdiction and improper venue.
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`2.
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`A Stay Will Prevent Hardship and Inequity to Defendants
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`As in this case, the Court may grant a motion to stay when good cause is shown and justice
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`is required “to protect a party or person from annoyance, embarrassment, oppression, or undue
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`burden or expense.” FED. R. CIV. P. 26(c); see Laundry v. Air Line Pilots Ass’n Int’l AFL-CIO, 901
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`F.2d 404, 436 (5th Cir. 1990) (explaining that “[d]iscovery is not justified when cost and
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`inconvenience will be its sole result”). A modest stay will promote efficiency as the stay will avoid
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`burdensome and expensive tasks associated with claim construction. See In re Apple, 979 F.3d at
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`1337.
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`If this case is transferred to the Northern District of California, that court has its own local
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`rules and Markman procedures that differ from those employed by this Court. If the case is
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`transferred, it is possible if not likely that the Northern District of California would require new
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`claim construction submissions that comply with its local rules. Indeed, in Synkloud v. Adobe, the
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`parties were on the eve of a Markman hearing in this Court (in August 2020) when the Federal
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`Circuit ordered the case transferred to N.D. Cal. where the parties were recently ordered to file an
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`initial case management statement by the end of January 2021, apparently restarting the entire
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`process. See In re Adobe Inc., 823 F. App’x 929 (Fed. Cir. 2020) (explaining that transfer is
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`appropriate because “retaining this case in the Western District of Texas is not convenient for the
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`parties and witnesses” and “[i]t is not in the interest of justice or proper administration”); see
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`Synkloud Techs., LLC v. Adobe, Inc., Civ. A. No. 19-cv-527-ADA (Aug. 12, 2020) ECF No. 53
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`(Order Canceling Markman Hearing); see id. at ECF No. 60 (Order Transferring Case to the
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`Northern District of California). At a minimum, if the case is transferred, the parties would devote
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`time and effort in that forum to briefing whether and to what extent the Northern District of
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`California court should consider or adopt what this Court has done, and that Court would have to
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`consider those issues. Therefore, if this Court holds Markman proceedings prior to its decision on
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`the Motion to Transfer, and transfer is ultimately ordered, there would be duplicative filings and
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`hearings that result in additional burden and expense to both parties and the judiciary.
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`In short, it would be grossly inefficient for the parties to proceed with Markman activity
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`now if this case is ultimately ordered transferred to the Northern District of California. This factor
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`strongly favors a stay.
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`3.
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`A Stay Will Conserve Judicial Resources
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`A stay pending a decision on Defendants’ transfer motion will conserve judicial resources,
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`because, as just explained, it eliminates the risk for unnecessary and potentially duplicative
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`briefing and hearings in two different district courts. A stay will also eliminate the potential for
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`unnecessary work in this Court. For example, a decision on transfer could issue in the midst of
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`Markman briefing if the Court declines to grant a stay. If transfer were granted after the Markman
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`process had begun here, efforts spent on Markman would have been wasted.
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`Overall, in this case, Defendants’ transfer motion presents a strong showing that a more
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`appropriate venue is the Northern District of California. The pending transfer motion demonstrates
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`that both Plaintiff and Defendants have major operations in California; key witnesses for both
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`parties are located in California (not Texas),
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`; any relevant domestic documents are located and accessible in
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`California; and virtually all known relevant non-parties are located in California. See ECF No. 30
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`at 1. For this, and all the other reasons set out in Defendants’ motion, the Northern District of
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`California is a more convenient venue for this action. It would, thus, be inefficient for the parties
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`to proceed with extensive and expensive Markman hearing preparation unrelated to venue under
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`the rules of the Western District of Texas if transfer to the Northern District of California is
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`ultimately ordered.
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`These considerations of efficiency and proportionality are particularly applicable here,
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`where, if a stay is not entered, the parties and the judiciary will soon be required to expend
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`significant resources preparing for Markman. Therefore, this factor strongly favors a stay.
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`III. CONCLUSION
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`For the reasons stated above, Defendants request that this Court stay the case pending
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`resolution of their transfer motion.
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`Dated: January 22, 2021
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`FISH & RICHARDSON P.C.
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`By: /s/ David M. Hoffman
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`Frank E. Scherkenbach (pro hac vice)
`scherkenbach@fr.com
`Adam J. Kessel (pro hac vice)
`kessel@fr.com
`Proshanto Mukherji (pro hac vice)
`mukherji@fr.com
`One Marina Park Drive
`Boston, MA 02210
`Tel: (617) 542-5070
`Fax: (617) 542-8906
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`David M. Hoffman
`Texas Bar No. 24046084
`hoffman@fr.com
`111 Congress Avenue, Suite 810
`Austin, TX 78701
`Tel: (512) 472-5070
`Fax: (512) 320-8935
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`COUNSEL FOR DEFENDANTS,
`BYTEDANCE LTD., BYTEDANCE INC.,
`TIKTOK INC., AND TIKTOK PTE. LTD.
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`CERTIFICATE OF SERVICE
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`The undersigned hereby certifies that on January 22, 2021 the foregoing document was
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`served electronically in compliance with Local Rule CV-5.2(e) upon Plaintiff’s counsel as follows:
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`Brian N. Platt
`bplatt@wnlaw.com
`Brent P. Lorimer
`blorimer@wnlaw.com
`WORKMAN NYDEGGER
`60 East South Temple Suite 1000
`Salt Lake City, UT 84111
`Tel: (801) 533-9800
`Fax: (801) 328-1707
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`Wesley Hill
`wh@wsfirm.com
`Chad Everingham
`ce@wsfirm.com
`Andrea L. Fair
`andrea@wsfirm.com
`WARD, SMITH & HILL, PLLC
`1507 Bill Owens Parkway
`Longview, TX 75604
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`Counsel for Plaintiff
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`9
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`/s/ David M. Hoffman
`David M. Hoffman
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`