Monday, February 18, 2019
This is a post by one of our new authors: Hilary Reed, Clinical Associate Professor Lawyering Skills and Strategies at the University of Houston Law Center.
Though Google has no offices, employees, or store fronts in East Texas, it does have some servers there. Last year, in a patent case, a district court judge deemed those servers a “place of business” in the Eastern District of Texas and established venue under 28 U.S.C. § 1400(b). The Eastern District of Texas is known as a “rocket docket” and has a reputation as a plaintiff-friendly patent jurisdiction. Google requested a writ of mandamus on the venue issue from the Federal Circuit. That writ was denied by a panel in October. Earlier this month the Federal Circuit denied a rehearing by the panel and a rehearing en banc on the writ in In re Google LLC, 2019 WL 438198 (Fed. Cir. Feb. 5, 2019). It’s hard to imagine that this issue won’t ultimately be decided on the merits by the Federal Circuit because of the decision’s wide-spread implications for tech companies, potentially subjecting them to venue anywhere they own equipment. But for now, the Federal Circuit has said that this is not one of those extraordinary causes mandamus should remedy.
For more discussion of the venue issue, check out this blog post.
While the underlying venue issue is certainly interesting, I want to focus here on the Federal Circuit’s mandamus analysis, particularly on the denial of the writ and Judge Jimmie Reyna’s strong dissents to both the original panel decision and the en banc rehearing denial. From a practical perspective, how big do the stakes have to be for the appellate court to take up an issue on a writ of mandamus?
Writs of mandamus allow litigants to request appellate review before there is a final judgment in a case. In the original panel decision, the Federal Circuit explains that “[a] writ of mandamus is a ‘drastic and extraordinary remedy reserved for really extraordinary causes.’” In re Google, LLC, 2018 WL 5536478, *1 (Fed. Cir. Oct. 29, 2019) (citation omitted). It then lays out the three requirements for a writ of mandamus:
[f]irst, the petitioner must ‘have no other adequate means to obtain the relief’ desired. Second, the petitioner must show that the ‘right to issuance of the writ is clear and indisputable.’ Third, ‘even if the first two prerequisites have been met, the issuing court, in the exercise of its discretion, must be satisfied that the writ is appropriate under the circumstances.”
Id. The court reminds us that “a post-judgment appeal generally is an adequate remedy for asserted §1400(b) violations.” Id. at *2. But mandamus can be available “in certain exceptional circumstances” in order to assure proper judicial administration. Id.
According to the majority, those circumstances do not exist in Google’s case—the issue needs to continue to percolate at the district court level. The court states that Google “failed to show that the district court’s ruling implicates the ‘special circumstances justifying mandamus review of certain basic, unsettled, recurring legal issues over which there is considerable litigation producing disparate results.’” Id. The court points to the small number of cases dealing with this issue at the district court level, and says that the “extraordinary remedy of a writ of mandamus is not currently warranted.” Id. at *3.
Judge Reyna’s dissents present an entirely different picture. I found his reasoning relating to the Court’s supervisory and instructional duties compelling, as well as his identification of a growing trend of suits against Google in the Eastern District of Texas. He warns that the court’s decision here weakens the Federal Circuit’s Writ of Mandamus jurisprudence. Part of the role of mandamus is to ensure “proper judicial administration.” The Federal Circuit also has a special role of supervision of lower courts on patent issues because of its exclusive subject-matter jurisdiction. By failing to issue the writ, the court allows a question to remain open that affects many technology companies and where they can be sued. Judge Reyna notes that a large technology company may own equipment in all jurisdictions, potentially subjecting it to nation-wide venue, which is not in line with Supreme Court jurisprudence.
As to the majority’s “percolation” principle, Judge Reyna states that “there is no principled reason to wait for these questions to ‘percolate’ further among districts . . . I see no justification for us to sit idly by while uncertainty builds and litigants and courts expend their resources on issues that we could have provided guidance on here.” Id. at *4. In fact, Judge Reyna reviewed the Eastern District of Texas docket and identified a growing trend of suits against Google—thirty-four new suits from October 29, 2018 when the panel denied the petition for mandamus until February 1, 2019.
Certainly, any adverse decision at the trial level can feel to the litigant like it should meet the mandamus standard because of the resources that they must spent before getting a final, appealable decision. Google now will litigate this case and possibly a large number of others in the Eastern District of Texas, with the possibility that a later appellate decision will find that venue was improper the entire time. While mandamus is supposed to be an extraordinary remedy, this seems like precisely the scenario where it makes sense. Of course, it’s hard to muster much sympathy for a resource-rich company like Google having to pay more in legal fees, but the current uncertainty on the venue question needs settling. And I’m sure to tech companies, the sooner the better. Unfortunately for them, the Federal Circuit decided they can wait.