Tour Tech. Software, Inc. v. RTV, Inc.

• Decision Date: 27 March 2019
• Docket Number: 17-CV-5817 (MKB)
• Citation: 377 F.Supp.3d 195
• Parties: TOUR TECHNOLOGY SOFTWARE, INC., Plaintiff, v. RTV, INC., John Does I-X, and Jane Does XI-XX, Defendants.
• Court: U.S. District Court — Eastern District of New York

377 F.Supp.3d 195

TOUR TECHNOLOGY SOFTWARE, INC., Plaintiff,

v.RTV, INC., John Does I-X, and Jane Does XI-XX, Defendants.

17-CV-5817 (MKB)

United States District Court, E.D. New York.

Signed March 27, 2019

Anthony H. Handal, Handal & Morofsky LLC, Fairfield, CT, for Plaintiff.

MEMORANDUM & ORDER

MARGO K. BRODIE, United States District Judge:

Plaintiff Tour Technology Software, Inc. ("Tour Technology") commenced the above-captioned action on October 4, 2017, against Defendant RTV, Inc. ("RTV"), alleging infringement of United States Patent No. 6,754,400 (the "'400 Patent"), a system and technology for rendering an image that enables, inter alia , an individual on a computer in a remote location to explore a 360-degree virtual view of a setting as if the individual were at that setting. ( Compl., Docket Entry No. 1.) After a discussion about the appropriate venue at a pre-motion conference on February 13, 2018, Plaintiff filed an Amended Complaint on March 13, 2018, adding Defendants John Does I-X and Jane Does XI-XX, photographers and customers, respectively, of RTV, and allegedly residents of New York. (Minute Entry dated Feb. 13, 2018; Am. Compl., Docket Entry No. 18.)

Currently before the Court is RTV's motion to dismiss for improper venue pursuant to 28 U.S.C. § 1406(a) and Rule 12(b)(3) of the Federal Rules of Civil Procedure, and for failure to state a claim for willful infringement pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. (Not. of Mot. to Dismiss, Docket Entry No. 21 ; Mem. in Supp. of Mot. to Dismiss ("Def. Mem."), Docket Entry No. 21-1.) Plaintiff opposes Defendant's motion. (Pl. Mem. in Opp'n to RTV's Mot. to Dismiss ("Pl. Mem."), Docket Entry No. 24.) For the reasons discussed below, the Court finds that venue is improper in the Eastern District of New York, and transfers this action with respect to Plaintiff's claims against RTV to the Western District of Michigan.

I. Background

Plaintiff Tour Technology is a New York corporation, with operations in Huntington, New York. (Am. Compl. ¶ 1.) Defendant RTV is a Michigan corporation, based in Traverse City, Michigan.¹ (Id. ¶ 2.)

Plaintiff owns the '400 Patent, entitled "System and Method for Creation, Processing and Visualization of Omni-Directional Images."² (Id. ¶ 8.) The United States Patent and Trademark Office issued the '400 Patent on June 22, 2004. (Id. ¶ 24; '400 Patent, annexed to Am. Compl. as Ex. A, Docket Entry No. 18-1.)³ The software-based technology underlying the '400 Patent enables an individual on a computer in a remote location to explore a 360-degree virtual view of an indoor or outdoor location, for example, an apartment, hotel room, restaurant, or backyard, "in a manner ... accepted by the viewer as substantially realistic."⁴ (Am. Compl. ¶¶ 9–10; '400 Patent 2.) The '400 Patent generally protects a method for creating and generating photographic images that are commonly used as online virtual tour images.

RTV presents, produces, and hosts 360-degree virtual tour content for clients. (Am. Compl. ¶ 32.) The clients are alleged to be individuals and businesses in New York and other states, "seeking to sell, rent, purchase, lease, and/or promote private residences, commercial real estate, hotels, sporting and recreation facilities, schools, event venues, country clubs, golf courses, upscale lodging facilities, restaurants, nightclubs, and healthcare facilities." (Id. ) On its website, RTV states that it "is a recognized leader in interactive 360 panoramic virtual tours, professional photography services, and virtual tour software." (RTV Recent Virtual Tours webpage, annexed to Am. Compl. as Ex. C, Docket Entry No. 18-3.) RTV's website also states that it is a "leading provider of virtual tour technology," and offers virtual tour software for real estate professionals and business entrepreneurs. (About Real Tour Vision webpage, annexed to Am. Compl. as Ex. D, Docket Entry No. 18-4.) Plaintiff alleges that this constitutes infringement of the '400 Patent. (Am. Compl. ¶ 33.)

In support of its claims, Plaintiff contends that Defendants use the patented technology to produce photographic images for virtual tours, host those images on the Internet, and/or use those images in sales and marketing activities. (Id. ¶ 35.) In particular, Plaintiff alleges that the virtual tour images that appear on the RTV website "indicate that the images are generated by the projection of a spherical image onto faces of a cube or a process equivalent thereto,⁵ where the spherical image was generated by the combination of multiple images," (id. ¶ 58), and that Defendants are thus "literally and/or under the doctrine of equivalen[ts], directly infringing, and indirectly infringing by way of inducing infringement and/or contributing to the infringement of the '400 Patent in the State of New York," (id. ¶ 34).

Plaintiff alleges that RTV has a "local presence" in the Eastern District of New York, and that the John Doe photographers are employee photographers of RTV. (Id. ¶¶ 37–41, 49–51.) Specifically, Plaintiff alleges that John Does "are photographers resident in this [d]istrict and/or working within this [d]istrict" and "employed by RTV in the business of creating images configured to be used in infringing the patent in suit and are practicing the invention which is the subject matter of the patent in suit." (Id. ¶ 3.) Plaintiff also contends that the John Doe Defendants use process steps in their photography for RTV that are covered under the claims of the '400 Patent, including "capturing images surrounding an origin point in at least two hemispheres surrounding the origin point," and "assembling the images in a digital format to create a complete spherical image surrounding the origin point." (Id. ¶ 47.)

In addition, Plaintiff alleges that Jane Does are customers of RTV and "are commercial enterprises practicing the invention in connection with their businesses located in and/or operating in this [d]istrict" and "include real estate agents advertising, using the technology of the invention, homes for sale and rent in this [d]istrict, and hotel and hospitality facilities located in this [d]istrict and advertising, using the technology of the invention, rooms available for occupancy by guest-customers." (Id. ¶ 4.)

II. Discussion

a. Standard of review

A plaintiff bears the burden of establishing that venue is proper once venue is challenged. In re ZTE (USA) Inc. , 890 F.3d 1008, 1013 (Fed. Cir. 2018) ; CDx Diagnostic. Inc. v.U.S. Endoscopy Grp., Inc. , No. 13-CV-5669, 2018 WL 2388534, at *1 (S.D.N.Y. May 24, 2018). However, at the motion to dismiss stage, where the court relies only on pleadings and affidavits, a "plaintiff need only make a prima facie showing of [venue]." Gulf Ins. Co. v. Glasbrenner , 417 F.3d 353, 355 (2d Cir. 2005) (alteration in original) (quoting CutCo Indus. v. Naughton , 806 F.2d 361, 364–65 (2d Cir. 1986) ); see also Dorchester Fin. Sec., Inc. v. Banco BRJ, S.A. , 722 F.3d 81, 84 (2d Cir. 2013) ("Prior to discovery, a plaintiff challenged by a jurisdiction testing motion may defeat the motion by pleading in good faith, legally sufficient allegations of jurisdiction." (quoting Ball v. Metallurgie Hoboken–Overpelt, S.A. , 902 F.2d 194, 197 (2d Cir. 1990) ) ). In determining whether a plaintiff has made a prima facie showing, a court "view[s] all the facts in a light most favorable to plaintiff." Phillips v. Audio Active Ltd. , 494 F.3d 378, 384 (2d Cir. 2007) ; Uni-Sys., LLC v. U.S. Tennis Ass'n, Inc. , 350 F.Supp.3d 143, 156 (E.D.N.Y. 2018). When faced with a motion to dismiss for improper venue, district courts may consider facts outside the pleadings. See Uni-Sys., LLC , 350 F.Supp.3d at 160 ; Peerless Network, Inc. v. Blitz Telecom Consulting, LLC , No. 17-CV-1725, 2018 WL 1478047, at *2 (S.D.N.Y. Mar. 26, 2018) ; Japan Press Serv., Inc. v. Japan Press Serv., Inc. , No. 11-CV-5875, 2013 WL 80181, at *4 (E.D.N.Y. Jan. 2, 2013) ; TradeComet.com LLC v. Google, Inc. , 693 F.Supp.2d 370, 375 n.3 (S.D.N.Y. 2010) ("In deciding a motion to dismiss pursuant to either Federal Rule of Civil Procedure 12(b)(1) or 12(b)(3), a court may consider evidentiary matters outside the pleadings, ‘by affidavit or otherwise,’ regarding the existence of jurisdiction.") (quoting Kamen v. Am. Tel. & Tel. Co. , 791 F.2d 1006, 1011 (2d Cir. 1986) ), aff'd in part , 647 F.3d 472 (2d Cir. 2011), and aff'd in part , 435 F. App'x 31 (2d Cir. 2011).

The Court considers the Amended Complaint, and the declarations and exhibits attached to the Amended Complaint and in support of the parties' memoranda. See, e.g. , TradeComet.com LLC , 693 F.Supp.2d at 375 n.3 (stating that the court would consider declarations and their attachments in deciding a Rule 12(b)(3) motion to dismiss).

b. Plaintiff has not made a prima facie showing that venue is proper for RTV

In patent infringement actions, venue is exclusively governed by 28 U.S.C. § 1400(b) (" section 1400(b)"). See TC Heartland LLC v. Kraft Foods Grp. Brands LLC , ––– U.S. ––––, ––––, 137 S.Ct. 1514, 1519, 197 L.Ed.2d 816 (2017) (citing Fourco Glass Co. v. Transmirra Prod. Corp. , 353 U.S. 222, 229, 77 S.Ct. 787, 1 L.Ed.2d 786 (1957) ). Proper venue under section 1400(b) is considered "an issue unique to patent law," and thus governed by Federal Circuit law instead of Second Circuit law. See In re ZTE , 890 F.3d at 1012 (citation omitted). Under section 1400(b), a civil action for patent infringement may be brought in a judicial district where (1) "the defendant resides," or (2) "where the defendant has committed acts of infringement and has a regular and established place of business." 28 U.S.C. § 1400(b). Thus, a plaintiff in a patent infringement action may either make a prima facie showing that the defendant resides in the judicial district where the plaintiff filed, or that the defendant has committed acts of infringement and has a regular and established place of business in that district. "[C]ourts...