Through an order issued on Monday, the Federal Circuit granted Hulu LLC’s petition for a writ of mandamus directing the Western District of Texas court to transfer a patent case filed by SITO Mobile R&D IP LLC and SITO Mobile Ltd. to the Central District of California.
The non-precedential opinion interpreted 28 U.S.C. § 1400(b), and found that the lower court abused its discretion in assessing the traditional transfer factors under 28 U.S.C. § 1404(a).
The dispute arose from a June 2020 case filed by SITO against Hulu for patent infringement. In particular, SITO accused the “Hulu Streaming Platform” of infringement based on its delivery of streaming video content in combination with other features, like revenue sharing with content providers, selections of advertisements by a “media selector,” and advertising based on physical location or statistical information.
On Oct. 2, 2020, four months after SITO filed its complaint, Hulu requested transfer to the Central District of California for convenience. Its motion explained that it delivers its streaming content via “third party content delivery networks” and that potential witnesses from those networks are located in the Central District of California.
On Apr. 28, 2021, the district court denied Hulu’s motion to transfer based on its analysis of the Fifth Circuit’s public and private interest factors. In this week’s decision, the Federal Circuit noted that it has jurisdiction under the All Writs Act, pursuant to which federal courts “‘may issue all writs necessary or appropriate in aid of their respective jurisdictions and agreeable to the usages and principles of law.’”
The appellate panel diverged from the lower court in finding that transfer should have been granted as the movant clearly demonstrated that it was for the convenience of the parties and witnesses, and in the interest of justice. The district court reportedly erred as to three factors: “(1) the availability of compulsory process to secure the attendance of witnesses; (2) the cost of attendance for willing witnesses; and (3) the administrative difficulties flowing from court congestion.”
As to compulsory process, and among other deficiencies, the lower court reportedly overlooked evidence showing that third-party witnesses are “overwhelmingly located within the subpoena power of only the transferee venue.” In addition, the court underweighted the significance of the fact that a substantial number of witnesses reside in the Central District of California, whereas none do in the Western District of Texas.
Finally, as to court congestion, the lower court reportedly put too much emphasis on the scheduled trial date. Case law dictates that “‘a court’s general ability to set a fast-paced schedule is not particularly relevant to the court congestion factor,” the opinion explained.
Hulu is represented by O’Melveny & Myers LLP and SITO by Daignault Iyer.
Notably, the federal circuit recently opined on the same transfer provision in another patent infringement case brought in the Western District of Texas. Its June 30 opinion granted the mandamus petition brought by Samsung after similarly finding the lower court’s transfer analysis flawed.
