Greenthread, LLC v. Intel Corporation

District Court, W.D. Texas·Decided December 27, 2022·No. 6:22-cv-00105·Unknown

Opinion

IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF TEXAS WACO DIVISION GREENTHREAD, LLC § Plaintiff § § -vs- § § 6:22-CV-105-ADA INTEL CORPORATION, DELL § INC., AND DELL TECHNOLOGIES § INC. § Defendants. §

MEMORANDUM OPINION AND ORDER Came for consideration is Defendant Intel’s Opposed Motion to Sever Plaintiff’s Claims against Intel, Transfer Venue of Those Claims to Oregon, and Stay Claims Against Dell Based on Accused Intel Products (the “Motion”). ECF No. 60. After carefully reviewing the Motion, the related pleadings, and the applicable law, the Court is of the opinion that Defendant’s Motion should be GRANTED. I. BACKGROUND Plaintiff Greenthread, LLC (“Greenthread”) sued Intel Corporation (“Intel”) and Dell Inc./Dell Technologies Inc. (“Dell”), for alleged infringement of patents directed to certain manufacturing steps for semiconductor devices. ECF No. 38 ¶¶ 1–2. Certain of Greenthread’s claims against Dell are based on Dell’s incorporation of accused Intel processors and flash memory products (the “Accused Intel Products”) into Dell products. Id. ¶¶ 61–62. Greenthread’s Complaint asserts the patents-in-suit against Intel “semiconductor products that practice the claimed inventions, including Intel Accused CPUs and Intel Accused Flash Memory Products.” Id. ¶ 49. Greenthread accuses Intel of infringement based on certain manufacturing steps undertaken for the Accused Intel Products—specifically, “process steps for creating regions with graded dopant concentrations.” Id. ¶ 52. Greenthread accuses Dell of infringing the patents-in-suit by “making, using, offering to sell, selling within, and/or importing into the United States Dell-Intel Accused Products.” Id. ¶ 63. Greenthread defines “Dell-Intel Accused Products” as “Dell Products incorporating or comprising Intel Accused Products,” including “Intel Accused CPUs and Intel

Accused Flash Memory Products.” Id. ¶¶ 61–62; see also ECF No. 38-8 at 7–8. Greenthread also accuses Dell of infringement based on separate flash memory products sold by Micron and Western Digital and image sensors sold by Sony. ECF No. 38 ¶¶ 64–81. II. LEGAL STANDARD A. Severance A “court may sever any claim against a party” to facilitate transfer. In re Nintendo of Am., Inc., 756 F.3d 1363, 1366 (Fed. Cir. 2014). “[T]he guiding principles” of the customer-suit doctrine “are efficiency and judicial economy.” Spread Spectrum Screening LLC v. Eastman Kodak Co., 657 F.3d 1349, 1357 (Fed. Cir. 2011). Under this doctrine, a stay of claims against downstream customer defendants is warranted where the case against the manufacturer has the

potential to resolve the major issues against those customer defendants. Id. at 1358. “When a patent holder sues multiple accused infringers, it may be proper for a court to sever certain claims against one or more of the accused infringers.” Collaborative Agreements, LLC v. Adobe Sys. Inc., No. 1- 14-CV-356-LY, 2015 WL 10818739, at *2 (W.D. Tex. Aug. 21, 2015) (citing Fed. R. Civ. P. 21). The Court has the power to sever the claims against properly joined Defendants and to stay the proceedings as to any of them. Id; see also In re Nintendo, 756 F.3d at 1365-66) (explaining that where suit is brought against a manufacturer and its customers, the action against the customers may be properly severed and stayed pending resolution of the case against the manufacturer to promote judicial economy.). To determine whether to sever claims when a plaintiff sues both a supplier and its customer for infringement, the Court should consider whether: “(1) the claim to be preserved is peripheral to the remaining claims; (2) the adjudication of the remaining claims is potentially dispositive of the severed claim; and (3) the transfer of the remaining claims is warranted under 28 U.S.C. §

1404(a).” Collaborative Agreements, LLC, 2015 WL 10818739, at *2. B. Transfer In patent cases, motions to transfer under 28 U.S.C. § 1404(a) are governed by the law of the regional circuit. In re TS Tech USA Corp., 551 F.3d 1315, 1319 (Fed. Cir. 2008). Title 28 U.S.C. § 1404(a) provides that “[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.” “Section 1404(a) is intended to place discretion in the district court to adjudicate motions for transfer according to an ‘individualized, case-by-case consideration of convenience and fairness.’” Stewart Org., Inc. v. Ricoh Corp., 487 U.S. 22, 29 (1988) (quoting Van Dusen v. Barrack, 376 U.S. 612,

622 (1964)). “The preliminary question under § 1404(a) is whether a civil action ‘might have been brought’ in the [transfer] destination venue.” In re Volkswagen, Inc., 545 F.3d 304, 312 (5th Cir. 2008) (“Volkswagen II”). If the destination venue would have been a proper venue, then “[t]he determination of ‘convenience’ turns on a number of public and private interest factors, none of which can be said to be of dispositive weight.” Action Indus., Inc. v. U.S. Fid. & Guar. Co., 358 F.3d 337, 340 (5th Cir. 2004). The private factors include: “(1) the relative ease of access to sources of proof; (2) the availability of compulsory process to secure the attendance of witnesses; (3) the cost of attendance for willing witnesses; and (4) all other practical problems that make trial of a case easy, expeditious and inexpensive.” In re Volkswagen AG, 371 F.3d 201, 203 (5th Cir. 2004) (“Volkswagen I”) (citing Piper Aircraft Co. v. Reyno, 454 U.S. 235, 241 n.6 (1982)). The public factors include: “(1) the administrative difficulties flowing from court congestion; (2) the local interest in having localized interests decided at home; (3) the familiarity of the forum with the law

that will govern the case; and (4) the avoidance of unnecessary problems of conflict of laws of the application of foreign law.” Id. III. ANALYSIS A. Severance The Court “must weigh carefully the comparative inconvenience of splitting the suit versus the advantages to be gained from a partial transfer” when considering sever-and-transfer requests. See In re: AMAZON.COM, INC., No. 2022-157, 2022 WL 17688072, at *3 (Fed. Cir. Dec. 15, 2022) (citing Def. Distributed v. Bruck, 30 F.4th 414, 428 (5th Cir. 2022) (internal quotation marks and citation omitted). The inclusion of a defendant only peripherally involved in, or indirectly connected to, the alleged wrongdoing should not preclude severance and partial transfer to a more

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