New Pacer--MOTION TO COMPEL ACER WITNESSES TO TESTIFY IN THIS JUDICIAL DISTRICT NOTICE OF MOTION
UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF CALIFORNIA
SAN JOSE DIVISION
ACER, INC., ACER AMERICA
CORPORATION and GATEWAY, INC.,
Plaintiff,
v.
TECHNOLOGY PROPERTIES
LIMITED, PATRIOT SCIENTIFIC
CORPORATION, and ALLIACENSE
LIMITED,
Defendants.
NOTICE OF MOTION AND MOTION TO
COMPEL THE DEPOSITIONS AND
TRIAL TESTIMONY OF PLAINTIFFS'
WITNESSES IN THIS DISTRICT
Date: December 23, 2008
Time: 10:00 a.m.
Dept: Courtroom 2, 5th Fl.
Before: Magistrate Judge Howard Lloyd (December 16, 2008 hearing date is requested in stipulated Request for Order Shortening Time, filed concurrently herewith)
Farella Braun & Martel LLP
235 Montgomery Street, 17th Floor
San Francisco, CA 94104
MOTION TO COMPEL ACER WITNESSES TO TESTIFY IN THIS JUDICIAL DISTRICT NOTICE OF MOTION AND MOTION TO PLAINTIFFS ACER INC., ACER AMERICA CORPORATION and GATEWAY, INC. PLEASE TAKE NOTICE that Defendants TECHNOLOGY PROPERTIES LIMITED, PATRIOT SCIENTIFIC CORPORATION, and ALLIACENSE LIMITED, pursuant to Rules 30 and 37 of the Federal Rules of Civil Procedure, move to compel the testimonies of all plaintiffs’ percipient witnesses in this judicial district. Having chosen to file suit in this district, the plaintiffs now refuse to produce their percipient witnesses who reside outside this judicial district in locations as far ranging as South Dakota and Taiwan. Because the law requires plaintiffs to make their witnesses available for depositions and trial testimony in the district where they initiated suit, this Court should enter its order requiring all plaintiffs to produce all their witnesses under their control for depositions and trial in this judicial district. This motion will be heard on December 23, 2008, at 10:00 a.m.1 or as soon thereafter as the matter can be heard. This motion is further based on the accompanying memorandum of points and authorities, supporting declarations, all pleadings, exhibits and papers on file in this action, and any other matters properly before the Court.
Dated: November 17, 2008 FARELLA BRAUN & MARTEL LLP
By: /s/ John L. Cooper
John L. Cooper
Attorneys for Defendants
TECHNOLOGY PROPERTIES LIMITED
and ALLIACENSE LIMITED
Dated: November 17, 2008 KIRBY NOONAN LANCE & HOGE
BY: /s/ Charles T. Hoge_______
Charles T. Hoge
Attorneys for Defendants
PATRIOT SCIENTIFIC CORPORATION
1 The parties have jointly requested a shortened hearing date on December 16, 2008. The stipulation is filed concurrently herewith.
Farella Braun & Martel LLP
235 Montgomery Street, 17th Floor
San Francisco, CA 94104
MOTION TO COMPEL ACER WITNESSES TO
TESTIFY IN THIS JUDICIAL DISTRICT
I. INTRODUCTION
After nearly four years of licensing negotiations, plaintiffs Acer Inc., Acer America Corp.,and Gateway Inc collectively “Acer”)2 abruptly halted discussions and filed suit in this district, seeking a declaratory judgment that they do not infringe any valid or enforceable claim found in three high-speed computer microprocessor patents (U.S. Patent Nos. 5,809,336; 5,784,584; and 5,440,749) owned by defendant Technology Properties Limited (“TPL”).3 Because two of the three patents at issue have previously been construed by Judge Ward of the Eastern District of Texas and all three patents at issue here are closely related, TPL requested this Court to transfer this lawsuit to Judge Ward. That request was denied by order dated October 21, 2008. Docket No. 47. In opposing TPL’s request, Acer reiterated its desire to litigate in this district, claiming that (i) plaintiff Acer America resided in this district, (ii) two of the plaintiffs reside in this state,
(iii) all of Acer’s U.S.-based business is conducted from this district, (iv) it is financially less burdensome to conduct discovery here, and (v) Acer Inc.’s “witnesses and representatives are able to take a direct flight to San Francisco.” Docket No. 34 at 2:2-13; 5:6-10; 8:15-18; 8:27- 9:9; & 9 n.4 (emphasis added). Despite these representations, Acer now refuses to produce its percipient witnesses here in this judicial district for deposition and trial testimony. Acer cannot have it both ways—forcing TPL to litigate in Acer’s preferred and purportedly convenient venue of choice while refusing to produce its percipient fact witnesses here. Thus, TPL respectfully requests, and judicial fairness requires, that this Court compel Acer to produce its percipient witnesses for deposition and trial testimony in this district.
II. STATEMENT OF FACTS
As Acer admitted in its pleadings, TPL has engaged in negotiations with Gateway since 2004 and with Acer since 2005 regarding their potential participation in TPL’s licensing program. Id. at 2:18-22. In February 2008, Acer abruptly ended these negotiations and filed this
2 Acer Inc. is a Taiwanese corporation. Acer America Corp. is a California corporation and a corporate subsidiary of Acer Inc. Gateway Inc. is a Delaware corporation and a wholly owned
subsidiary of Acer Inc.
3 Defendant Patriot Scientific Corporation co-owns an interest in the three patents at issue. Declaratory judgment suit. Docket No. 1. On April 25, 2008, TPL moved to dismiss this case, or in the alternative, to transfer the case to the Eastern District of Texas because Judge Ward had previously studied the technology at issue and construed 33 terms across three of TPL’s microprocessor patents, including two that are at issue in this case (the ’336 and ’584 patents). Docket No. 19. Acer successfully opposed this motion, asserting the arguments that Acer America Corp. and Gateway, Inc. reside in this state and that it is financially less burdensome to conduct discovery here, in part because, witnesses and representatives are able to take a direct flight to San Francisco.” Docket No. 34 at 2:2-13; 8:27-9:9; & 9, n.4. At the September 19 hearing on the motion, counsel for Acer reiterated that Acer America resides in this district, that Acer America and Gateway have their “principal places of business in this state,” and that Acer Inc. “does business in the United States through its subsidiary [Acer America].” Declaration of Jeffrey M. Fisher In Support of Motion to Compel the Depositions and Trial Testimony of Plaintiffs’ Witnesses In This District (“Fisher Decl.”), Exhibit A (9/19/08 Hearing Tr. at 16:11-17). Noting that “this district affords direct access to witnesses and tangible evidence, and makes travel for parties and witnesses most convenient,” the Court denied TPL’s motion on October 21. Docket No. 47 at 6:10-11 (emphasis added). In preparing the parties’ Joint Case Management Conference Statement, the parties met and conferred regarding where Acer’s witnesses would be produced. The parties were unable to reach an agreement. Docket No. 48 at 5:25-6:4. At the November 7, 2008 Case Management Conference, Judge Fogel asked the parties to raise the issue with this Court and request that the dispute be resolved prior to December 19, 2008, the date of the next scheduled CMC in this action. Fisher Decl. Exh. B (11/7/08 CMC Hearing Tr.) at 5:23-6:13. The parties jointly left a message for the clerk of this Court on November 7 requesting a hearing on December 16 (if that is convenient for the Court) and have agreed on a stipulated briefing schedule. Id. at 5. The stipulation is filed concurrently herewith.
III. ARGUMENT
A. Legal Standard Fed. R. Civ. P. 30 specifies that “a party may, by oral questions, depose any person, including a party, without leave of court” and that the deposing party can notice the time and place of the deposition. “A party may unilaterally choose the place for deposing the opposing party, subject to the granting of a protective order by the Court pursuant to Federal Rule of Civil Procedure 26(c)(2) designating a different place.” Lexington Ins. Co. v. Commonwealth Ins. Co., 1999 WL 33292943, at *9 (N.D. Cal. Sep. 17, 1999). Fed. R. Civ. P. 37 (a)(1) further states that “a party may move for an order compelling disclosure or discovery.” Pursuant to the Federal Rules of Civil Procedure, and for the reasons set forth below, TPL respectfully requests that the Court issue an order compelling Acer to produce its witnesses for deposition and trial testimony in this district.
B. Acer Should Be Compelled To Produce Its Percipient Witnesses In This Judicial District1. Acer Is Required To Produce Its Witnesses For Depositions And Trial Testimony In The District Where It Brought Suit.Because Acer chose to file this declaratory judgment action in this district, Acer must fulfill its legal obligation and produce all of their percipient witnesses for depositions in this judicial district. Courts in the Ninth Circuit have regularly recognized that a “‘plaintiff will be required to make himself or herself available for examination in the district in which suit was brought.’” Lexington, 1999 WL 33292943, at *9 (citing 8A Wright, Miller & Marcus, FEDERAL PRACTICE & PROCEDURE: Civ. 2d §2112, at 75); see also Detweiler Bros., Inc. v. John Graham & Co., 412 F.Supp. 416, 422 (E.D. Wash. 1976) (stating the same rule); Rolex Employees Retirement Trust v. Mentor Graphics Corp., 1990 WL 200092, at *1 (D. Or. Dec. 3, 1990)(accord). “Since plaintiff has selected the forum, he or she will not be heard to complain about having to appear there for a deposition.” 8A Wright, Miller & Marcus, FED. PRAC. & PROC.: Civ. 2d § 2112, at 75-76 (2008). In Lexington, the plaintiff argued that the depositions of its employees should occur at its principal places of business in Houston, Texas, and London, as opposed to San Francisco, where the lawsuit was venued.4 Lexington, 1999 WL 33292943, at *8. The Lexington Court rejected 4 This is the same argument Acer has raised in opposition to TPL’s request that Acer’s Taiwanese witnesses be produced in San Francisco for their depositions. See Docket No. 48 at 5:25-6:4. the plaintiff’s argument for several reasons. First, the plaintiff, having chosen its venue of choice, must bear the cost of conducting discovery in its chosen forum. Id. at *9. Second, having depositions in the “district where the action is being litigated …permits predictability in prospective litigation” and “pragmatically permits the trial court to resolve disputes which may take place during the course of depositions without undue expenditure of time.” Id. at *9 (quoting Minnesota Mining & Mfg. Co. v. Dacar Chemical Prods., Co., 707 F. Supp. 793, 795
(W.D. Pa. 1989)). Finally, the Court noted that the plaintiffs chose to conduct business in the Northern District of California, and should have envisioned that litigation could take place in this venue. Id. The same factors and considerations apply to the case at hand. Acer has repeatedly stated in its prior representations to this Court, particularly in opposing TPL’s motion to dismiss or transfer venue to Texas, that the Northern District is a convenient and proper forum for this litigation. Docket No. 34 at 3:7-10; 5:6-11; & 9:5-9. Acer chose this district, in part, because Acer America resides in this district, and “Gateway conducts business and owns property within this district.” Id. at 8:16-17. In addition, if issues arise during the deposition of Acer’s witnesses, they are much more easily resolved by this Court if the depositions occur here in San Francisco than if the depositions are taken in Taiwan, South Dakota, or even any judicial district outside of the Northern District of California. Finally, all three plaintiffs conduct significant business in this district. Id. at 3:7-10 Even Acer, Inc., the Taiwanese parent corporation of Acer America and Gateway, has admitted that it conducts “all of its US business through its subsidiary Acer America, which is located in San Jose.” Id. at 3:9-10 & 5; see also Docket No. 36 at ¶ 4. Thus, similar to the plaintiff in Lexington, Acer should have envisioned potential litigation in this district because it chose to conduct significant amounts of business here. Acer must abide by “the general rule” and make its employees available for deposition in this district.
2. Acer Cannot Establish Any Undue Burden Or Compelling Circumstance That Dispels Its Obligation To Produce Its Witnesses In This District For Their Depositions and Trial Testimony “To avoid the application of this rule, a plaintiff has the burden of proving that undue hardship or exceptional or compelling circumstances justify his refusal to travel to his chosen forum.” Rolex, 1990 WL 200092, at *1. Acer cannot meet its burden here. As outlined in the statement of facts, Acer has repeatedly indicated to this Court that this judicial district is the proper venue for this litigation, that this forum is more convenient for discovery, and that Acer Inc.’s Taiwanese witnesses could “take direct flights to San Francisco.” Docket No. 34 [Acer’s Opp. to TPL’s Mtn. to Dismiss] at 2:2-13; 5:6-10; 8:15-18; 8:27-9:9; & 9 n.4. In Acer’s opposition to TPL’s motion to dismiss, Acer admitted that California is a more convenient forum for discovery than Texas: [W]ith respect to factor (3) “relative convenience of the parties,” Texas is significantly less convenient to Acer, Acer America and Gateway. Acer America’s principal place of business is located in this district, Gateway’s principal place of business is in California, and as far away as Taiwan is from California, Texas is even further, requiring additional travel time. Id. at 9:5-9. Acer further argued there that “it would be more financially burdensome on all the parties if they were forced to conduct discovery in Texas.” Id. at 8:25-26. By making these arguments, Acer recognized its obligation to bring its witnesses to this district for depositions and trial. Yet, conducting deposition discovery in Taiwan or South Dakota creates equal, if not greater, financial burden. Recognizing Acer’s convenience argument, Judge Fogel noted in his order denying TPL’s motion to dismiss that “this district affords direct access to witnesses and tangible evidence, and makes travel for parties and witnesses most convenient.” Docket No. 47 at 6:10-11. The fact that Acer, Inc.’s witnesses would need to travel internationally does not establish undue hardship. Courts have regularly compelled foreign plaintiffs to bring their witnesses to their chosen forum for depositions. See, e.g., Seuthe v. Renwal Prods., Inc., 38 F.R.D. 323 (S.D.N.Y 1965) (requiring plaintiff, a resident of West Germany who brought suit for unfair competition and patent infringement in New York, to submit to taking of his deposition in New York over his objection of financial hardship); Newman v. Metropolitan Pier & Exposition Authority, 962 F.2d 589, 591-92 (7th Cir. 1992) (J. Posner) (plaintiff’s claimed financial difficulties did not excuse her from her failure to appear for deposition in the district where she brought suit); Societe Internationale Pour Participations Industrielles et Commerciales S.A. v. Clark, 8 F.R.D. 565 (D.D.C. 1948) (holding that defendants were entitled to take depositions of officers and managing agents of plaintiffs Swiss corporations in the district where suit was brought, and not in Switzerland as argued by the plaintiff). Indeed, forcing counsel for the parties in this action – all of whom reside in California – to travel to Taiwan for depositions of Acer’s witnesses would be significantly more burdensome for all parties than requiring Acer Inc.’s witnesses to appear in this district for their depositions. After zealously representing that this district is a convenient forum, Acer cannot reverse its position and argue that producing its Taiwanese witnesses here for their depositions and trial testimony would be unduly burdensome
or even inconvenient.
IV. CONCLUSION
For the reasons stated above, TPL respectfully requests this Court order Acer, Inc., Acer America Corp., and Gateway Inc. to produce all of their witnesses for depositions and trial here in this judicial district.
Dated: November 17, 2008 FARELLA BRAUN & MARTEL LLP
By: /s/ John L. Cooper
John L. Cooper
Attorneys for Defendants
TECHNOLOGY PROPERTIES LIMITED
and ALLIACENSE LIMITED
Dated: November 17, 2008 KIRBY NOONAN LANCE & HOGE
BY: /s/ Charles T. Hoge_______
Charles T. Hoge
Attorneys for Defendants
PATRIOT SCIENTIFIC CORPORATION
