It is a “well-established rule that suits against alien defendants are outside the operation of the federal venue laws.”[1] Judge Gilliam stopped a declaratory judgment plaintiff’s attempt to initiate a parallel lawsuit in California when only the plaintiff’s foreign parent was sued in Texas.

AU Optronics Corporation (“AUO”) was formed in 2001 in Taiwan when Acer Display Technology, Inc. merged with Unipac Optoelectronics Corporation.  In 2002, AUO was listed at the New York Stock Exchange, becoming the first manufacturer of pure TFT-LCDs to do so.

Plaintiff AU Optronics Corporation America (“AUO USA”) has a principal place of business in California. Before AUO USA filed its declaratory judgment action in the Northern District of California, Defendant Vista Peak Ventures, LLC (“Vista Peak”) had filed three lawsuits against AUO USA’s foreign parent corporation in the Eastern District of Texas alleging patent infringement. None of the Texas lawsuits named AUO USA as a defendant.
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After a jury verdict of willful infringement, almost $6,000,000 in patent-related damages, and a Chapter 7 bankruptcy, Judge Freeman increased WOSS’s legal troubles by granting TRX’s motions for enhanced damages and attorneys’ fees.[1]

Enhanced Damages.  Judge Freeman first granted TRX’s request for enhanced damages under 35 U.S.C. § 284 given its egregious behavior.  In making her determination, Judge Freeman considered the Read factors[2] and WOSS’s subjective intent.

At trial, the jury found that WOSS willfully infringed US Patent No. 7,044,896 (“the ’896 patent”).  Central to Judge Freeman’s decision to enhance damages was WOSS’ intent at the time of infringement.  At trial, WOSS’s founder, Mr. Ott, testified that he did not think WOSS’s band (left) infringed the ’896 patent (right):

Figure showing WOSS’s band               Figure displaying ’896 patent


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Olivia Garden was founded in Belgium in 1967 by husband and wife team Jean and Micheline Rennette (pictured left).  According to its website, Olivia Garden was and continues to be a pioneer in hairstyling, including introducing the first truly silent blowdryer in 1979 and the first ceramic-ionic combination brush in 2002.

But Judge Gilliam brushed off Olivia Garden’s bid for patent and trade dress infringement damages when he granted Defendant Stance Beauty’s motion to dismiss for improper venue.  In doing so, Judge Gilliam rejected Olivia Garden’s request to exercise “pendent venue.”  Judge Gilliam enumerated various reasons why Olivia Garden failed to show that Stance Beauty had a “regular and established place of business” in the Northern District of California, including that Stance Beauty was incorporated in Connecticut, never maintained a place of business in California, and had no offices, retail locations, officers, employees, books, or records in California.  Stance Beauty also had never attempted to become qualified or licensed to do business in California.  Thus, Olivia Garden’s request failed to satisfy either prong of 35 U.S.C. § 1400(b) in view of TC Heartland.[1]
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