Texas patent judge is reversed on case transfer denial

A federal judge in Texas who handles nearly a quarter of the nation's patent infringement cases and frequently rejects motions to transfer the lawsuits elsewhere was reversed Friday by an appellate court.

Quinn Emanuel Urquhart & Sullivan LLP partner Kevin P.B. Johnson scored a win for his defendant client, Sunnyvale based Juniper Networks Inc., and got the case transferred out of the Lone Star State to the Northern District of California.

The per curiam decision by a U.S. Court of Appeals for the Federal Circuit panel is another win for technology company defendants seeking to move cases filed by patent holding companies to California. The panel directed U.S. District Judge Alan D. Albright to transfer the lawsuit, which includes six patent infringement complaints filed by WSOU Investments LLC, out of the Western District of Texas. In re: Juniper Networks, Inc., 21-160 (Fed. Cir., filed July 2, 2021).

WSOU Investments does business as Brazos Licensing and Development, and only moved its headquarters from California to the Western District of Texas recently, the opinion noted. The company's CEO and president still live in California.

The judges described the case as "a close cousin" to two other recent Federal Circuit decisions, including one filed in August in favor of Hulu LLC's bid to transfer a case out of Albright's court to the Central District of California. In re: Hulu LLC, 2021-142 (Fed. Cir., filed April 28, 2021).

"In those cases, as in this one, the center of gravity of the action was clearly in the transferee districts, not the Western District of Texas," the panel wrote in the Juniper Networks opinion.

Albright has been challenged more than a dozen times this year when he has denied a defense motion to transfer a patent case. The results have been mixed.

The judge, appointed to the bench in 2018 by President Donald Trump, has heard more patent cases since the start of 2020 than the second-place venue, the District of Delaware. He has 23% of the nation's district court docket, according to data compiled by Lex Machina, and exceeds the one-time top patent venue, the Eastern District of Texas.

The Federal Circuit panel's decision was in one respect unsurprising, according to Michael C. Smith, a Marshall, Texas based partner at Scheef & Stone LLP who is not involved in the case.

Albright's decision to deny Juniper Networks' transfer motion was filed in June, before the Federal Circuit overturned his Hulu decision.

But Smith said in a phone interview the opinion might pose additional hurdles for patent holding companies trying to sue defendants in Texas courts because it suggests Brazos doesn't manufacture or sell products.

Brazos "does not suggest it is in need of a quick resolution because its position in the market is being threatened," the panel wrote. "Even if the district court's projection of the likely time to trial in the two venues is accurate, the court did not point to any reason that a more rapid disposition of the case that might be available in Texas is worthy of important weight."

Smith said he was surprised by the panel's suggestion that nonpracticing entities might be less entitled to a speedy trial, even though Albright ruled "time to trial" was a factor that supported keeping the case in the Western District of Texas.

"It's the first time I have ever seen an appellate court suggest there are two lanes," with companies that sell products on a faster lane to trial, he said.

Attorneys with Brown Rudnick LLP who represent Brazos did not return messages seeking comment on the Federal Circuit ruling or whether they would ask for en banc review.

Johnson, as well as Juniper, did not respond to emails seeking comment.

The judges on the panel were Alan D. Lourie, William C. Bryson and Richard G. Taranto.