The opinion of the court was delivered by: Lucy H. Koh United States District Judge
ORDER GRANTING DEFENDANTS' MOTIONS TO FREESCALE SEMICONDUCOR, INC., NATIONAL SEMICONDUCTOR CORP., and TRANSFER CASES TO EASTERN DISTRICT OF TEXAS
to three now-expired patents owned by or exclusively licensed to Defendants: U.S. Patent No. 18
5,042,009 (the '009 Patent). Defendants United Module Corp. and Keranos LLC move to dismiss, 20 transfer, or stay the cases based on the first-to-file rule. Defendants are Plaintiffs in an earlier filed 21 action in the Eastern District of Texas pending before the Honorable T. John Ward. The Court 22 23 held a hearing on these motions on March 3, 2011. Pursuant to the parties' request, the Court stayed these cases through June 8, 2011 to provide the parties an opportunity to try to resolve the 25 cases through mediation. The parties participated in a court-appointed mediation on June 6, 2011,
In these related actions, Plaintiffs seek a declaration of non-infringement and invalidity as 4,795,719 (the '719 Patent); U.S. Patent No. 4,868,629 (the '629 Patent); and U.S. Patent No. 19
but the parties did not settle the cases. As of June 9, 2011, the case is no longer stayed.*fn1 For the 2 reasons set forth below, the Court GRANTS the motions to transfer based on the first-to-file rule.
5 6 declaratory judgment action on September 20, 2010. See Compl. [dkt. #1] in Case No. 10-CV- 4241-LHK. Three additional cases followed. On November 16, 2010, Plaintiffs Freescale
Semiconductor, Inc., National Semiconductor Corp., and Analog Devices, Inc., filed their own 9 declaratory judgment action. See Compl. [dkt. #1] in Case No. 10-CV-5196-LHK. On November 10
22, 2010, Plaintiffs Taiwan Semiconductor Manufacturing Co., Ltd., TSMC North America, and 11
Plaintiffs Microchip Technology, Inc., and Silicon Storage Technology, Inc., filed this UBICOM, Inc., filed a decl See Compl. [dkt. #1] in Case No. 10-CV-aratory judgment action.
5290-LHK. Finally, on January 28, 2011, Plaintiffs Samsung Electronics Co., Ltd., and Samsung
0430-LHK. The Court found these cases related pursuant to the District's Civil Local Rules.
The Defendants in each of the cases are United Module Corp. (UMC) and Keranos (collectively "DJ Defendants"). UMC is the owner of the three now-expired patents. According to
DJ Plaintiffs, the '719 and '629 patents expired in 2006, while the '009 patent expired in 2008. 20
UMC is headquartered in Los Altos, California. According to patent assignment records, a 21 22 suit on June 29, 2000. See Tatelman Decl., Exh. 26. Keranos was formed as a Texas Limited 24
Semiconductor Inc. filed a declaratory judgment action. See Compl. [dkt. #1] in Case No. 11-CV-
Hereafter, Plaintiffs will be referred to as "DJ Plaintiffs." 17
Fremont, California company named "Waferscale Integration Inc." assigned UMC the patents-in- Liability Company on February 10, 2010. See Tatelman Decl, Exh. 15 ("Certificate of 25 Formation"). The street address of Keranos is 211 E. 7th Street, Suite 620, Austin, Texas 78701-2
3128. According to its Certificate of Formation, Keranos has a sole member, J. Nicholas Gross, 3 whose address is located in Berkeley, California. According to the DJ Defendants, although UMC 4 is the legal owner of the patents at issue, shortly after Keranos was formed, UMC "completely 5 6 transferred to Keranos its rights to sue" under an Exclusive License Agreement. See Defs.' Reply*fn2 at 7.
On June 23, 2010, Keranos filed a patent infringement action in the Eastern District of Texas. That action is captioned "Keranos LLC v. Analog Devices, Inc., et al., Civil Action No. 10 2:10-cv-207" ("Texas Case"), and involves claims of infringement with respect to the same three patents at issue in this action. The claims of patent infringement relate to, among other devices, "integrated circuits using embedded flash memory in discrete form, wafer form, or incorporated 13 14 within larger systems on printed circuit boards." See Compl. ¶ 12. Each of the DJ Plaintiffs here, except for Silicon Storage Technology (SST), is a Defendant in the Texas case. SST is a wholly 16 owned subsidiary of DJ Plaintiff Microchip Technology, Inc. Id. at ¶ 2 ("On April 8, 2010, 17 Plaintiff SST became a wholly-owned subsidiary of Plaintiff Microchip.") Besides the DJ 18
Plaintiffs, the Texas case also includes some two-dozen other Defendants, including Qualcomm, 19 Inc., Intel Corp., IBM Corp., and Apple, Inc. According to DJ Defendants (and the Court's review 20 of the docket in the Texas Case), defendants in the Texas Case have filed more than twenty 21 22 motions to dismiss for lack of standing and/or for judgment on the pleadings (specifically raising the issue of whether UMC is a "necessary and indispensable party"). Those motions are fully 24 briefed, and under submission before Judge Ward. 25 26 27 28 merely citing information available in the redacted public version of Keranos' Reply Brief.
3 first to file rule. DJ Plaintiffs oppose dismissal on both grounds. The Court exercises its discretion 4 to decline to rule on UMC's jurisdictional argument, and instead finds transfer proper based on the 5 6 first-to-file rule.
9 conveniens dismissal, bypassing questions of subject-matter and personal jurisdiction, when 10 considerations of convenience, fairness, and judicial economy so warrant." See Sinochem Int'l Co. v. Malaysia Int'l Shipping Corp., 549 U.S. 422, 423 (2007). The Supreme Court went on to state that a "federal court has leeway to choose among threshold grounds for denying audience to a case 13 14 on the merits." Id. at 431. The Supreme Court's conclusion in Sinochem is equally applicable in the context of motions to transfer, which are not decisions on the merits. See San Francisco Tech., 16
UMC argues that the Court lacks subject matter jurisdiction over it. Specifically, UMC 18 argues that there is no actual case or controversy between UMC and DJ Plaintiffs because UMC, as 19 the patent owner, completely transferred to Keranos UMC's rights to sue for patent infringement. 20
Thus, UMC contends any litigation threat to DJ Plaintiffs is from Keranos and not from UMC. 21 22
Texas Case, it does not reach UMC's argument for dismissal based on a lack of an actual case or 24 controversy, and thus a lack of subject matter jurisdiction. *fn3 A decision by this Court that there is, 25
DJ Defendants have moved to dismiss on two grounds: subject matter jurisdiction and the A.UMC's Motion to Dismiss for Lack of Subject Matter Jurisdiction
The Supreme Court has ruled that a district court "may dispose of an action by a forum non
Inc. v. Glad Prods. Co., 2010 U.S. Dist. LEXIS 83681, *19 (N.D. Cal. July 19, 2010). 17
Because the Court has determined that transfer is appropriate based on the earlier filed
549 U.S. at 425 ("a court need not resolve whether it has authority to adjudicate the cause (subject-
Case No.: 10-CV-04241, 10-CV-5290, 10-CV-5196 ORDER GRANTING DEFENDANTS' MOTIONS TO TRANSFER
Case5:10-cv-04241-LHK Document77 Filed06/09/11 Page6 of 13
or is not, an actual case or controversy between UMC and DJ Plaintiffs is inappropriate given the 2 fully briefed motions in the Texas Court on the related issue of whether UMC, as the patent owner, 3 is a necessary and indispensable party in the Texas Case. The ...