Evergreen Telemetry LLC v. Fieldpiece Instruments Incorporated

• Court: District Court, D. Arizona
• Decided: August 1, 2025
• Docket: 2:24-cv-02814
• Status: Unknown

Opinion

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA 8

Evergr een Telemetry LLC, ) No. CV-24-02814-PHX-SPL ) 9 ) 10 Plaintiff, ) ORDER vs. ) ) 11 ) Fieldpiece Instruments Incorporated, ) 12 ) 13 Defendant. ) ) 14 )

15 Before the Court is Defendant’s Motion to Dismiss for Improper Venue (Doc. 13), 16 Plaintiff’s Response (Doc. 19), and Defendant’s Reply (Doc. 20). For the following 17 reasons, the Motion will be denied.1 18 I. BACKGROUND 19 On October 17, 2024, Plaintiff Evergreen Telemetry LLC (“Evergreen”) initiated 20 this suit against Defendant Fieldpiece Instruments, Inc. (“Fieldpiece”), alleging three 21 claims of patent infringement in violation of 35 U.S.C. § 271(a)–(c). (Doc. 1 ¶¶ 104–127). 22 Plaintiff owns three patents relating to wireless heating, ventilation, and air-conditioning 23 (“HVAC”) tools and systems—the ’857 Patent, the ’466 Patent, and the ’798 Patent 24 (collectively, the “Asserted Patents”). (Id. at ¶ 12). It alleges that since 2015, Defendant 25 has been making, using, selling and/or offering its own wireless HVAC testing system that 26

27 1 Because it would not assist in resolution of the instant issues, the Court finds the pending motions are suitable for decision without oral argument. See LRCiv. 7.2(f); Fed. 28 R. Civ. P. 78(b); Partridge v. Reich, 141 F.3d 920, 926 (9th Cir. 1998). 1 infringes upon Plaintiff’s patents (“Accused Products”) in the United States without 2 authorization. (Id. at ¶ 20). 3 On April 9, 2025, Defendant filed the present Motion to Dismiss for Improper 4 Venue arguing that Fieldpiece does not reside in or have a “regular and established place 5 of business” in the District of Arizona, and that Evergreen simply seeks to avail itself of its 6 home forum. (Doc. 13 at 2–3). Plaintiff acknowledges that Fieldpiece is a Delaware 7 corporation, with a formal place of business in Orange, California. (Id. at ¶ 35). It alleges, 8 however, that Fieldpiece derives substantial revenue from the District of Arizona, selling 9 the Accused Products at over 100 distributors statewide. (Id. at ¶¶ 40, 44). Plaintiff further 10 alleges that a “Fieldpiece Sales Representative” lives in and maintains a home-based office 11 in Arizona, stores work-related materials in their home-based office, accepts orders, makes 12 business decisions, solicits customers, engages in technician training, and takes part in 13 industry and community events on behalf of Defendant. (Id. at ¶ 53). Defendant 14 acknowledges that after using third-party sales representatives for many years, it hired a 15 full-time Arizona-based sales representative in November 2022, who after leaving the 16 company in October 2024, was replaced by the current Arizona-based employee. (Doc. 19- 17 2 at 9–10). 18 II. LEGAL STANDARD 19 A party may file a motion to dismiss for lack of venue pursuant to Federal Rule of 20 Civil Procedure (“Rule”) 12(b)(3). Fed. R. Civ. P. 12(b)(3). In patent cases, 28 U.S.C. § 21 1400(b) is the “sole and exclusive provision controlling venue in patent infringement 22 actions” and is not supplemented by the general venue statutes. TC Heartland LLC v. Kraft 23 Foods Grp. Brands LLC, 581 U.S. 258, 266 (2017) (citing Fourco Glass Co. v. Transmirra 24 Prods. Corp., 353 U.S. 222, 229 (1957)). Additionally, “Federal Circuit law, rather than 25 regional circuit law, governs [the court’s] analysis of what § 1400(b) requires”. In re Cray 26 Inc., 871 F.3d 1355, 1360 (Fed. Cir. 2017). “[T]he burden of establishing proper venue [is] 27 on the Plaintiff.” In re ZTE (USA) Inc., 890 F.3d 1008, 1014 (Fed. Cir. 2018). In deciding 28 whether venue is proper on a Rule 12(b)(3) motion, “the pleadings need not be accepted as 1 true, and the court may consider facts outside of the pleadings.” Infinity Cube Ltd. v. 2 Mangolytics, Inc., No. 22-CV-547-RSH-AGS, 2023 WL 6217359, at *2 (S.D. Cal. Feb. 3 22, 2023) (quoting Murphy v. Schneider Nat’l, Inc., 362 F.3d 1133, 1137 (9th Cir. 2004)). 4 Venue lies “in the judicial district where the defendant resides” or “where the 5 defendant has committed acts of infringement and has a regular and established place of 6 business.” 28 U.S.C. § 1400(b). For purposes of § 1400(b), a domestic corporation 7 “resides” only in its state of incorporation. TC Heartland LLC, 581 U.S. at 268. 8 Alternatively, for a defendant to have a “regular and established place of business” within 9 a district, three requirements must be satisfied: “(1) there must be a physical place in the 10 district; (2) it must be a regular and established place of business; and (3) it must be the 11 place of the defendant.” In re Cray Inc., 871 F.3d at 1360. “If any statutory requirement is 12 not satisfied, venue is improper under § 1400(b).” Id. 13 III. DISCUSSION 14 The parties’ primary dispute is whether Defendant has a “regular and established 15 place of business” in the District of Arizona under the three Cray requirements.2 Therefore, 16 this Court will limit its discussion to the Cray requirements. 17 A. “Regular and Established Place of Business” under 28 U.S.C. § 1400(b) 18 a. Physical Place 19 “While the ‘place’ need not be a ‘fixed physical presence in the sense of a formal 20 office or store,’ [] there must still be a physical, geographical location in the district from 21 which the business of the defendant is carried out.” In re Cray Inc., 871 F.3d at 1362 22 (quoting In re Cordis Corp., 769 F.2d 733, 737 (Fed. Cir. 1985)); see In re Google LLC, 23 949 F.3d 1338 (Fed. Cir. 2020) (rejecting the argument that a “physical place of business” 24 should focus on real property owned or leased by a corporation). 25 Defendant argues that the home of an alleged salesperson in Arizona does not

26 2 Defendant and Plaintiff both acknowledge that Fieldpiece does not reside in 27 Arizona and is incorporated in Delaware. (Doc. 13 at 3); (Doc. 1 ¶ 35). There is also no dispute between the parties as to whether the alleged infringement occurred in the District 28 of Arizona. 1 constitute a “physical place” of business because “Fieldpiece’s sales representatives are 2 responsible for a variety of territories, of which Arizona is only one.” (Doc. 13 at 5). 3 Plaintiff responds that when it filed its Complaint, Defendant employed a sales 4 representative in Arizona “who was responsible for managing sales, distributor 5 relationships, field work, and on-site training for customers in Arizona.” (Doc. 19 at 4). 6 Plaintiff points to deposition testimony where Defendant admits that it provided its Arizona 7 sales representatives with a company-branded vehicle and shipped products and 8 equipment, literature, and other merchandising items to their homes. (Id. at 5). Allegedly, 9 these products were to be stored and distributed from the homes of the sales representatives. 10 (Id.) 11 Defendant replies that while the sales representatives live in Arizona, they perform 12 minimal, sporadic administrative work in their physical homes. (Doc. 20 at 8). Rather, most 13 of their work involves “visiting distributor locations, demonstrating products, providing 14 training to distributors employees on Fieldpiece’s products.” (Id.) Defendant then, after 15 admitting to shipping and storing products in the representatives’ homes, argues that it is 16 not using the homes as a de facto warehouse for inventory. (Id.) Rather, the employees are 17 merely storing products necessary “to perform their job at other locations,” and such 18 storage does not constitute a “physical place” of business. (Id. (emphasis in original)). 19 Notably, Fieldpiece does not maintain any physical offices, stores, or warehouses 20 in the District of Arizona. (Doc. 13 at 4). Because there are no physical offices, stores, or 21 warehouses, all demonstration products, promotional materials, and merchandise are 22 shipped directly to the employees’ homes. (Doc. 19-2 at 15). Defendant emphasizes in its 23 Reply that the storage of product inventory for sale would constitute a “physical place” by 24 virtue of a de facto warehouse, but its storage of demonstration products or promotional 25 materials would not. (Doc. 20 at 8). Defendant cites C.R. Bard, Inc. v. Smiths Med. ASD, 26 Inc., No. 212CV00036RJSDAO, 2020 WL 6710425 at *6 (D. Utah Nov. 16, 2020), and 27 Herbert v. Diagnostic Prods. Corp., No. 85 CIV. 0856, 1986 WL 6781 (S.D.N.Y. June 10, 28 1986) to support this proposition. (Doc. 20 at 10). 1 While these cases provide helpful insight to the analysis, this Court finds neither 2 determinative to the present case. Herbert is distinguishable because there “the 3 [employees’] homes [are] only involved in storing some promotional literature and 4 customer files and handling telephone calls.” 1986 WL 6781 at *4. C.R. Bard, Inc. is a 5 closer comparison; in that case, the court noted that “[a]n important consideration is 6 whether the stored products were ever directly sold or distributed to customers.” 2020 WL 7 6710425 at *11. But C.R. Bard, Inc. is factually distinguishable because that case involved 8 sixteen sales representatives—of which only two lived in the disputed district—who were 9 responsible for servicing five different states. Id. at *5. Emphasizing that “no one fact is 10 controlling” and “[c]onsidering the record as a whole,” the court used the “nature of the 11 product” as only one of several factors to determine venue was improper. Id. at *13. 12 This Court finds RegenLab USA LLC v. Estar Techs. Ltd., 335 F. Supp. 3d 526 13 (S.D.N.Y. 2018), to be a more persuasive comparison. In that case, the employer shipped 14 “sales kits” to its employees’ homes, which contained demonstration products and 15 literature to use during sales demonstrations. Id. at 552. The employer made the same 16 “product inventory for sale vs. demonstration product” argument that Defendant puts forth. 17 Id. The court rejected that argument, finding that “[t]he employees did not merely possess 18 those products—their use in New York was part of each employee’s job description . . . 19 the employee uses the products stored in their home office to conduct demonstrations.” Id. 20 Here, it is true that Fieldpiece employees do not sell the products that are shipped 21 to and stored in their homes. (Doc. 20 at 11). But unlike Herbert, the employees do not 22 merely possess promotional literature or products. Instead, like the employees in RegenLab 23 USA LLC, Fieldpiece employees use the products they store at their homes to “conduct 24 business at third party locations.” (Id.) Therefore, on balance, the Court finds that the 25 “physical place” requirement is met because the products stored in Defendant’s employees’ 26 homes are used to fulfill their job duties at locations throughout Arizona. 27 b. Regular and Established Place of Business 28 “To satisfy the ‘regular and established’ requirement, a business may be ‘regular’ if 1 it operates in a steady, uniform, orderly, and methodical manner, and ‘established’ if it is 2 not transient but instead settled certainly or fixed permanently.” IOT Innovations LLC v. 3 Monitronics Int'l, Inc., No. 2:22-CV-0432-JRG-RSP, 2023 WL 6318049, at *3 (E.D. Tex. 4 Sept. 11, 2023), report and recommendation adopted, No. 222CV00432JRGRSP, 2023 5 WL 6300560 (E.D. Tex. Sept. 27, 2023) (citing In re Cray Inc., 871 F.3d at 1362). See also 6 Phillips v. Baker, 121 F.2d 752, 756 (9th Cir. 1941) (“A ‘regular place of business’ is, 7 obviously, a place where such business is carried on ‘regularly’ and not merely temporarily, 8 or for some special work or particular transaction.”). 9 Defendant cites Cray for its mistaken proposition that its employees’ homes cannot 10 be considered “regular and established” places of business because Fieldpiece employees 11 “are under no obligation to reside in Arizona and can freely move out of the District” 12 without approval. (Doc. 13 at 5). Plaintiff responds that Defendant’s employees’ homes 13 “have uniformly served as the operational bases for Fieldpiece’s sales, training, and 14 marketing activities in this District since at least November 2022.” (Doc. 19 at 5). Plaintiff 15 further argues that Defendant’s business operates in Arizona with steady regularity, in that 16 the employees’ job descriptions include “building relationships with store associates, 17 providing sales training, [and] optimizing the merchandising at the point of purchase.” 18 (Doc. 19 at 6). Plaintiff also points to Defendant’s public list of distributors, which lists at 19 least 100 locations in Arizona compared to the 30 in Nevada and 15 in California. (Id.) 20 The Court finds the “regular and established” place of business requirement to be 21 met because of the steady, uniform, orderly, and methodical business that both starts and 22 finishes at the sales representatives’ homes, with visits to distributors in between. First, 23 Defendant’s statement of law regarding an employee moving out of the district under Cray 24 is incorrect. Defendant’s assertion adds the restrictive language of “cannot” and omits the 25 Federal Circuit’s analysis that an employee’s ability to freely move out of district “would 26 cut against the employee’s home being considered a place of business of the defendant.” 27 In re Cray Inc., 871 F.3d at 1363 (emphasis added). Additionally, as discussed below, 28 courts consider an employee’s obligation to live in a certain state when analyzing the “place 1 of the defendant” requirement, not the “regular and established” requirement. See IOT 2 Innovations LLC, 2023 WL 6318049 at *3. Thus, the Court finds Defendant’s employees’ 3 ability to move is not dispositive on this factor. 4 Here, Defendant has more than 100 distributors in the District of Arizona. (Doc. 19 5 at 6). Since at least November 2022, Fieldpiece has had at least one sales representative 6 with a physical home in Arizona. (Doc 19-2 at 9). Thus, every night for the past several 7 years, Fieldpiece sales representatives have stored more than $11,000 worth of 8 demonstration products and company-leased, Fieldpiece-branded vehicles at their homes 9 in the District of Arizona. See (Doc. 19 at 9–10 (listing the Fieldpiece demonstration 10 products and their estimated values)); IOT Innovations LLC, 2023 WL 6318049, at *4 11 (finding venue proper because, among many other factors, “the service technicians store a 12 leased vehicle and tens of thousands of dollars of Brinks Home equipment at their homes”). 13 Further, the representatives travel from their homes—using their leased, company 14 vehicles—to over 100 distributors in the District of Arizona to demonstrate and pitch their 15 products. Fieldpiece’s business—starting and ending at the sales representatives’ homes in 16 Arizona each day since late 2022—has operated in a “steady, uniform, orderly, methodical” 17 and non-transient manner. See Remington Rand Bus. Serv. v. Acme Card Sys. Co., 71 F.2d 18 628, 629 (4th Cir. 1934) (holding a five-year continuous presence demonstrates that 19 business was established for purposes of venue); c.f. Knapp–Monarch Co. v. Casco Prods. 20 Corp., 342 F.2d 622, 625 (7th Cir. 1965) (holding that a business that demonstrated its 21 products twice a year at a trade show did not have an established presence). Therefore, this 22 Court finds that the employees’ homes meet the requirement of a “regular and established” 23 place of business in the District of Arizona. 24 c. Place of the Defendant 25 “As the statute indicates, it must be a place of the defendant, not solely a place of 26 the defendant’s employee . . . Relevant considerations include whether the defendant owns 27 or leases the place, or exercises other attributes of possession or control over the place.” In 28 re Cray Inc., 871 F.3d at 1363 (emphasis in original). “Another consideration might be 1 whether the defendant conditioned employment on an employee’s continued residence in 2 the district or the storing of materials at a place in the district so that they can be distributed 3 or sold from that place.” Id. “Marketing or advertisements also may be relevant, but only 4 to the extent they indicate that the defendant itself holds out a place for its business.” Id. 5 Defendant argues that it does not own or lease its employees’ homes, store inventory 6 or conduct demonstrations there, list the home addresses as places of business, or require 7 employees to put Fieldpiece’s name on or near their homes. (Doc. 13 at 6). Defendant 8 further claims that it does not require its sales representatives to live in Arizona, nor does 9 it “condition any support or employment on the maintenance of such a location”. (Id.) 10 Plaintiff responds by arguing that Defendant (1) requires its employees to live in 11 Arizona, (2) stores products and materials at employees’ homes, and (3) displays its brand 12 name at the employee’s homes. (Doc. 19 at 7–13). First, Plaintiff argues that “efficiency 13 and demand require Fieldpiece’s [representatives] live in Arizona, as opposed to Nevada 14 or California” because over two-thirds of the distributors are in Arizona. (Id. at 7). Plaintiff 15 then provides the Court with a Fieldpiece LinkedIn job posting for a “Territory Sales 16 Representative” position servicing Arizona and Nevada that explicitly states, “[m]ust be 17 located in the Phoenix area.” (Id. at 8). Second, Plaintiff provides the Court with a detailed 18 list of demonstration samples stored at the employees’ homes that roughly totals more than 19 $11,000, in addition to assorted “brochures/catalogs/signage,” merchandising setups, and 20 promotional items, including hundreds of branded keychains and screwdrivers. (Id. at 9– 21 11). Plaintiff also notes that the representatives store a “Fieldpiece-branded vehicle” at 22 their homes. (Id. at 11). Third, Plaintiff provides the Court with a photograph of the 23 “Fieldpiece-branded vehicle” displayed outside of what is alleged to be an employee’s 24 home, arguing that Fieldpiece clearly displays its logo outside of employees’ homes. (Id. 25 at 13). 26 Defendant replies to each of the arguments in turn. First, Defendant acknowledges 27 that the language of the advertisement “suggests” that the candidate must live in Phoenix. 28 (Doc. 20 at 13). It claims, however, that it would have considered applicants from Nevada 1 or California, and that “internal job descriptions” do not require candidates to live in a 2 particular state. (Id.). Second, Defendant argues that there is no evidence to prove that it 3 requires employees to store samples, materials, or other products for sale or distribution 4 from their private homes. (Id. at 13–14). Rather, Defendant claims that the representatives 5 could store all the materials “in their truck.” (Id. at 14). Third, Defendant argues that a 6 Fieldpiece-branded truck parked on the street of an employee’s home cannot reasonably 7 be compared to a permanent sign affixed to the residence. (Id. at 15). 8 This Court finds the “place of the defendant” requirement is met because 9 Fieldpiece’s “business specifically depend[s] on employees being physically present” in 10 Arizona and it “affirmatively acted to make permanent operations within that district to 11 service its customers there.” In re Cray Inc., 871 F.3d at 1365 (citing In re Cordis Corp., 12 769 F.2d 733). Factors on this requirement cut both ways. On the one hand, Defendant 13 does not own, lease, or make any contributions directly towards the sales representatives’ 14 homes. It also claims, contrary to its public job posting, that the territory sales 15 representatives are not required to live in Arizona. (Doc. 19-2 at 21). Nor does Defendant 16 publish the addresses of its sales representatives’ homes as places of business. Concerning 17 the Fieldpiece-branded vehicle, the Court is not persuaded that the vehicle’s presence 18 outside of a private home indicates that the home is a “place of the Defendant.” 19 On the other hand, Defendant recently posted a job opening on LinkedIn for the 20 position of Territory Sales Representative, and the advertisement image explicitly states: 21 “Must be located in the Phoenix area.” (Doc. 19 at 8). Eliminating any doubt that the words 22 in the image were posted in error, when the job posting is expanded it reads “[y]ou must 23 be based in the Phoenix metro area and open to travel to stores across Arizona and Nevada 24 (about 35% overnight).” (Doc 19-4 at 46). Even if employment was not conditioned on 25 living in Arizona, it would be extremely difficult for the sales representative to fulfill their 26 on-site job duties at over 100 locations in Arizona while living in Nevada or California. 27 To that end, this case differs from In re Cray Inc., where “no evidence show[ed] 28 that [the defendant] believed a location within the [district] to be important to the business 1 | performed,” or that the defendant “had any intention to maintain some place of business in 2| that district.” RegenLab USA LLC, 335 F. Supp. 3d at 552 (quoting In re Cray Inc., 871 F.3d at 1365). In that case, the court ultimately found that the homes were not the “place 4| ofthe defendant.” In re Cray Inc., 871 F.3d at 1366. Instead, here, the importance of having 5 | an employee in Arizona is seen through Fieldpiece’s decision to hire an Arizona-based 6 | sales representative in November 2022, rather than continuing to use an independent sales agency. (Doc. 19-2 at 10). Further, when the first sales representative left Fieldpiece in 8 | October 2024, it hired another Arizona-based sales representative to fill the position. (/d. at 10). Clearly, Fieldpiece saw some value in having one of their own employees live and 10 | maintain a home in Arizona, as they chose not to return to the independent sales agency. Therefore, this Court finds that the sales representatives’ Arizona homes are a “place of the 12 | defendant,” because without a physical presence, Fieldpiece would be hard-pressed to 13 | service its more than 100 Arizona distributors.? 14 IV. CONCLUSION 15 No one fact is dispositive in determining venue. See In re Cray, 871 F.3d at 1366. 16 | Considering all the facts together, this Court finds that Plaintiff has met its burden in 17 | establishing Defendant has a regular and established place of business in the District of 18 | Arizona. Thus, venue is proper under 28 U.S.C. § 1400(b). 19 Accordingly, 20 IT IS ORDERED that Defendant’s Motion to Dismiss (Doc. 13) is denied. Dated this Ist day of August, 2025. 22 23 Ake 24 United States District 25 26, 00° 7 _ 3 Because this Court finds that Plaintiff has met its burden as to the three Cray requirements through its employees’ homes, discussion regarding whether the third-party 28 (See ponery in reguiar and fore shed places of business of Fieldpiece is unnecessary.