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In re Cray Inc.

United States Court of Appeals for the Federal Circuit

September 21, 2017, Decided

2017-129

Opinion

 [*1356]   [***1002]  ON PETITION

Lourie, Circuit Judge.

ORDER

Cray Inc. ("Cray") petitions for a writ of mandamus vacating the order of the United States District Court for the Eastern District of Texas denying its motion to transfer the case to the United States District Court for the Western District of Wisconsin. See Raytheon Co. v. Cray, Inc., No. 2:15-cv-01554-JRG, 258 F. Supp. 3d 781, 2017 U.S. Dist. LEXIS 100887, 2017 WL 2813896 (E.D. Tex. June 29, 2017) ("Transfer Order"). Raytheon Company ("Raytheon") opposes the petition. The district court misinterpreted the  [*1357]  scope and effect of our precedent in determining that Cray maintained "a regular and established place of business" in the Eastern District of Texas within the meaning of 28 U.S.C. § 1400(b). Accordingly, the court's decision refusing transfer pursuant to 28 U.S.C. § 1406(a) was an abuse of discretion. We therefore grant Cray's petition for a writ of mandamus and direct transfer of the case.

Background

This petition arises from a patent infringement action filed by Raytheon against Cray in the Eastern District of Texas. Cray sells advanced supercomputers that Raytheon accuses of infringement. Cray is a Washington corporation with its principal place of business located there. [**3]  It also maintains facilities in Bloomington, Minnesota; Chippewa Falls, Wisconsin; Pleasanton and San Jose, California; and Austin and Houston, Texas.

Although Cray does not rent or own an office or any property in the Eastern District of Texas, it allowed Mr. Douglas Harless and Mr. Troy Testa to work remotely from their respective homes in that district. Transfer Order, 2017 U.S. Dist. LEXIS 100887, 2017 WL 2813896, at *1-2 & n.1. Mr. Testa worked for Cray as a senior territory manager while residing in the district from 2010 to 2011 before the underlying suit was filed. 2017 U.S. Dist. LEXIS 100887, [WL] at *1 n.1

Mr. Harless worked as a "sales executive" for approximately seven years with associated  [***1003]  sales of Cray systems in excess of $345 million. 2017 U.S. Dist. LEXIS 100887, [WL] at *1. Mr. Harless's responsibilities also included "new sales and new account development in [the] Central U.S." and "management of key accounts within the Financial, Biomedical and Petroleum Industries." Id. (alteration in original) (quotation marks omitted). Cray's "Americas Sales Territories" map, an internal document, identified Mr. Harless as a "Named Account Manager" and his location at his Eastern District of Texas personal home. Id. Mr. Harless received reimbursement for his cell phone usage for business purposes, internet fees, and mileage or [**4]  "other costs" for business travel. Id. Cray provided Mr. Harless with "administrative support" from its Minnesota office. Id. He provided "price quotations" to customers, listing himself as the "account executive" and the person who prepared the quotation. 2017 U.S. Dist. LEXIS 100887, [WL] at *6. The communications also identified his home telephone number as his "office" telephone number with an Eastern District of Texas area code. Id.

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871 F.3d 1355 *; 2017 U.S. App. LEXIS 18398 **; 124 U.S.P.Q.2D (BNA) 1001 ***; 2017 WL 4201535

IN RE: CRAY INC., Petitioner

Subsequent History: Transferred to Raytheon Co. v. Cray, Inc., 2018 U.S. Dist. LEXIS 92922 (W.D. Wis., June 1, 2018)

Prior History:  [**1] On Petition for Writ of Mandamus to the United States District Court for the Eastern District of Texas in No. 2:15-cv-01554-JRG, Judge J. Rodney Gilstrap.

Raytheon Co. v. Cray, Inc., 258 F. Supp. 3d 781, 2017 U.S. Dist. LEXIS 100887 (E.D. Tex., June 29, 2017)

CORE TERMS

venue, regular, place of business, established place of business, district court, mandamus, permanent, patent, infringement, sales, patent infringement, products, argues, statutory language, venue statute, employees, quotation, courts, reside, stored, cases, court's decision, circumstances, advertised, reimbursed, customers, purposes, carries, listing

Civil Procedure, Remedies, Writs, All Writs Act, Common Law Writs, Mandamus, Patent Law, Jurisdiction & Review, Personal Jurisdiction & Venue, Places of Business & Residence, Personal Jurisdiction & Venue, Preliminary Considerations, Venue, Venue, Federal Venue Transfers, Improper Venue Transfers