Picker International, Inc. v. Varian Associates, Inc.

661 F. Supp. 347, 2 U.S.P.Q. 2d (BNA) 1964, 1987 U.S. Dist. LEXIS 10571
CourtDistrict Court, N.D. Ohio
DecidedMay 18, 1987
DocketC86-328
StatusPublished
Cited by5 cases

This text of 661 F. Supp. 347 (Picker International, Inc. v. Varian Associates, Inc.) is published on Counsel Stack Legal Research, covering District Court, N.D. Ohio primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Picker International, Inc. v. Varian Associates, Inc., 661 F. Supp. 347, 2 U.S.P.Q. 2d (BNA) 1964, 1987 U.S. Dist. LEXIS 10571 (N.D. Ohio 1987).

Opinion

MEMORANDUM OPINION AND ORDER

BATTISTI, Chief Judge.

Defendant, Varían Associates, Incorporated (hereinafter “Varían”), a Delaware Corporation with its principal place of business in Salt Lake City, Utah, has filed a motion to dismiss for improper venue under 28 U.S.C. § 1400(b) or alternatively for a change of venue pursuant to 28 U.S.C. 1404(a) to the District of Utah. Plaintiff, Picker International, Incorporated (hereinafter “Picker”), is a New York Corporation with its principal place of business in this District in Highland Heights, Ohio.

Plaintiff filed this patent infringement action on February 10, 1986 under 28 U.S.C. 1338, alleging defendant’s infringement of U.S. Patent No. 4,315,182 issued February 9, 1982 for which plaintiff is assignee. The patent encompasses a frosted glass x-ray tube. Plaintiff alleges both (1) direct infringement of its patent through defendant’s manufacturing, using and selling the patented invention and (2) indirect infringement of the patent by the defendant’s inducement of others to infringe by similar use and sales in this district.

The uncontested facts as provided by affidavit are as follows:

Varian’s frosted x-ray tubes are manufactured only in Salt Lake City. Although Varían has a sales office located in this District, it is not engaged in the sales or servicing of the accused x-ray tubes. Rather, Varían has a Chicago-based marketing engineer who entered this District on numerous occasions for the purpose of soliciting sales of x-ray products, including the accused tube. No samples of the accused tubes accompanied the marketing representative into this District, hence no use or demonstration of the accused tube by Varian’s representative occured in this District. Finally, Varian’s marketing engineer is not authorized to accept orders; rather, all orders for the accused x-ray tubes were forwarded to Salt Lake City for acceptance there and shipped f.o.b. directly to the purchaser.

I. The Motion to Dismiss For Improper Venue

A. Direct Infringement.

Venue for patent actions is governed solely and exclusively by 28 U.S.C. 1400(b) which provides:

*349 Any civil action for patent infringement may be brought in the judicial district where the defendant resides, or where the defendant has committed acts of infringement and has a regular and established place of business.

Since a corporation is a “resident” of only the state of its incorporation, Farco Glass Co. v. Transmirra Products Corp., 353 U.S. 222, 77 S.Ct. 787, 1 L.Ed.2d 786 (1957), Varían “resides” in Delaware, it is the latter part of this statute that forms the basis of the instant claim to venue. As defendant does not contest the fact that it has a regular and established place of business within this District, examination will be focused upon the requisite “acts of infringement” allegedly committed here.

The acts constituting infringement of patents are set out in 35 U.S.C. § 271(a):

[Wjhoever without authority makes, uses or sells any patented invention, within the United States during the term of the patent therefore, infringes the patent.

It is apparent that plaintiff does not allege either defendant's manufacture or use of the accused x-ray tubes in this District. The question presented, then, is whether defendant Varían has “sold” in this District any of its allegedly infringing x-ray tubes as of the date of the filing of this action.

Defendant Varian premises its Motion to Dismiss upon the so-called “consummated sale doctrine.” According to this doctrine, no sale for patent venue purposes occurs in a district where a dealer solicits orders there and forwards the order to a manufacturer in a second district, from which the manufacturer ships the goods directly to the customer. W.S. Tyler Co. v. Ludlow-Saylor Wire Co., 236 U.S. 723, 35 S.Ct. 458, 59 L.Ed. 808 (1915); R.D. Werner Co., Inc. v. Sears, Roebuck & Co., 349 F.Supp. 660, 661 (N.D.Ohio 1972); Farval Corp. v. Blaw-Knox Co., 60 F.Supp. 900 (N.D.Ohio 1945).

Defendant therefore argues that in applying the consummated sale doctrine, venue here is improper because no “sale” in the Uniform Commercial Code context of the accused x-ray tubes occurred in this District. Thus, defendant asserts that its marketing engineers, having no authority to bind the purchaser and forwarding orders to the Utah plant for acceptance and shipment directly to the customer, did not engage in conduct sufficient to constitute a sale and that consequently venue in this district is improper.

Plaintiff, however, has briefed the Court concerning a new test that is evolving which focuses on the degree of conduct of the defendant within the district and not upon whether the defendant technically consummated the sale within the district. Those courts reassessing the consummated sale doctrine hold that the physical presence of a defendant’s sales representative in the district, their continuous solicitation of orders there, coupled with the physical presence and demonstration of the accused item is a sufficient degree of conduct to constitute an infringing sale for the purposes of establishing venue in the district where this conduct occurred. See, e.g., Union Asbestos & Rubber Co. v. Evans Prod. Co., 328 F.2d 949 (7th Cir.1964); Ingersoll-Rand Co. v. Rockwell International, Inc., 420 F.Supp. 277 (S.D.Fla.1976).

The case at bar is the first of its type to appear before this Court since Union Asbestos and progeny have exerted their influence on the application of the act of infringement requirement. Plaintiff, aware that venue clearly does not lie in this District under the consummated sale doctrine, is now urging the Court to adopt the more liberal Union Asbestos rule, confident that venue in this district is proper under that test.

While it is noted the impact which Union Asbestos and progeny have had in partially eroding the common law and Uniform Commercial Code definitions of a sale in the patent venue context, nonetheless the Court is constrained to continue following the lead of both the Supreme Court and this District in applying the consummated sale doctrine. The competing authority cited above appears to premise its reasoning on the belief that “the ‘act of infringement’ requirement is liberally construed.” William Sklaroff Design Associates, Inc. v. Metcor Manufacturing, Inc.,

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661 F. Supp. 347, 2 U.S.P.Q. 2d (BNA) 1964, 1987 U.S. Dist. LEXIS 10571, Counsel Stack Legal Research, https://law.counselstack.com/opinion/picker-international-inc-v-varian-associates-inc-ohnd-1987.