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Clerisy Corp., and Reed Transition Technologies, LLC v. Airware Holdings

October 4, 2012

CLERISY CORP., AND REED TRANSITION TECHNOLOGIES, LLC, PLAINTIFFS,
v.
AIRWARE HOLDINGS, INC. (D/B/A/ AIRWARE LABS), AND CROWN DYNAMICS CORP., DEFENDANTS,



The opinion of the court was delivered by: Hon. Michael A. Telesca United States District Judge

DECISION AND ORDER

INTRODUCTION

Plaintiffs, Clerisy Corp. ("Clerisy") and Reed Transition Technologies, LLC ("Reed") (collectively, "Plaintiffs"), bring this action for patent infringement against AirWare Holdings, Inc. and Crown Dynamics Corp. (collectively, "Defendants") relating to United States Patent Number 6,295,982 ("the '982 Patent") entitled "Apparatus for and Methods of Administering Volatile Substances into an Inhalation Flow Path", issued by the United States Patent and Trademark Office on October 2, 2001. (Docket No. 1.) Defendants, both having their principal places of business located in Scottsdale, Arizona, move for an Order transferring this case to the United States District Court for the District of Arizona; or, in the alternative, to dismiss for lack of personal jurisdiction and lack of standing as to Clerisy Corp. (Docket No. 14.)

For the reasons discussed herein, this Court grants Defendants' motion to transfer to the United States District Court for the District of Arizona and denies as moot the motion to dismiss for lack of personal jurisdiction. In the interest of consistency in the administration of this case, the Court leaves the determination of the motion to dismiss for lack of standing to the United States District Court for the District of Arizona.

DISCUSSION

28 U.S.C. § 1404 provides, "[f]or the convenience of parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought or to any district or division to which all parties have consented." A district court may consider, inter alia, the following factors when determining whether to grant a motion to transfer venue: "(1) the plaintiff's choice of forum, (2) the convenience of witnesses, (3) the location of relevant documents and relative ease of access to sources of proof, (4) the convenience of parties, (5) the locus of operative facts, (6) the availability of process to compel the attendance of unwilling witnesses, and (7) the relative means of the parties." N.Y. Marine and Gen. Ins. Co. v. Lafarge N. Am., 599 F.3d 102, 112 (2d Cir. 2010)(quoting D.H. Blair & Co., Inc. v. Gottdiener, 462 F.3d 95, 106-7)). The party moving for transfer must show by clear and convincing evidence that the factors favor the transfer. N.Y. Marine, 599 F.3d at 113-114.

(1) Plaintiffs' Choice of Forum

A plaintiff's choice of forum is generally entitled to substantial deference; however, if "the balance is strongly in favor of the defendant" the court may, in its discretion, determine that venue is more appropriate in another district court. See Gross

v. British Broadcasting Corp.,386 F.3d 224, 230 (2d Cir.2004). Plaintiff's choice of forum is entitled to little deference where the "locus of operative facts lay elsewhere," or if the plaintiff (or, as in this case, one of the plaintiffs) is not located in the forum district. See Fuji Photo Film Co., Ltd. v. Lear Media, Inc., 415 F.Supp.2d 370, 376 (S.D.N.Y. 2006).

Plaintiffs chose to bring this case in this District. However, one of the Plaintiffs, Reed, is located within the District of Arizona, in Sedona, Arizona - a fact which will also affect the analysis of the convenience of the parties. Additionally, as discussed below, the most relevant facts will be located outside of this district, primarily in the District of Arizona. Accordingly, the Court finds that Plaintiffs' choice of forum is entitled to some weight, but not substantial deference.

(2) The Convenience of the Witnesses "Convenience of both the party and non-party witnesses is probably the single-most important fact in the analysis of whether transfer should be granted." Fuji, 415 F.Supp.2d at 373 (quoting Berman v. Informix Corp., 30 F.Supp.2d 653, 656 (S.D.N.Y.1998)).

The expected materiality of the witness' testimony should be considered, and a mere tally of the number witnesses in each forum is an insufficient method to determine whether the convenience of the witnesses supports a transfer. Id.

Plaintiffs state that "Plaintiff Clerisy has five party witnesses in New York ... that have knowledge regarding Clerisy's patented products and its business." They further state that the owner of Reed, and the wife of the deceased '982 Patent inventor, who lives in Arizona, is willing to travel to New York. Plaintiffs also identify a non-party witness, an unspecified major grocery chain in New York, that may testify regarding damages.

For their part, Defendants state that they have four witnesses located within the District of Arizona who will testify regarding the "accused products, their design and development, the market for the accused products, and their sales and distribution." They argue that this factor weighs in favor of transfer because the key witnesses, those with knowledge of the design and development of the '982 Patent (Reed, and its owner and employees), and those with knowledge of the design and development of the accused products, employees of the Defendants, all reside in Arizona. Def. Reply at 4 ...


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